The Frustration of Self Distribution
December 6th, 2005 Posted in Distribution, MusicEarlier this year I was sitting with Josh and Chris talking about the process of releasing the ever in stasis Cell Culture EP “Revelationsâ€. This EP was actually finished over 2 years ago and has been shelved due to so many different reasons at this point I can’t even recall them all anymore.
At the time we were just beginning to establish Fake Science and we started looking into how FS could release the EP and what kind of investment it would take. We really wanted to do this release professionally so we knew this would not be a simple CD-R release.
After a bit of research, this is how the pricing of the EP was looking like: First, we would master the EP. The EP is made up of 5 tracks and looking at local mastering houses we were confident we could get the album mastered for around $500. The pressing of the CD would be done with a single speed glass master, jewel case, 4/4 printing, silkscreen, shrink wrap and an UPC code. At the time we found a place in Marin that would do it for around $2100. Finally, we wanted professional artwork and layout done by our friend Molly, and the estimate was around $1500. All said and done we were looking at about $4100 to get the CD done to the level of quality that we wanted.
This process would produce 1000 CDs that we can distribute. Of the 1000, we wanted to pull 250 for promotion and giveaways. We would send the majority of the 250 to reviewers, labels, magazines, web sites, etc. The goal would be to build some momentum and start a marketing campaign to try and get some traction with the release.
After the campaign we would have 750 to actually sell and distribute. Since this release was a simple EP with 5 tracks we felt that asking $10 was out of the question for an unsigned artist. Even for an established artist, $10 for 5 songs seems like a ripoff. This meant that we would have to sell them for $5, just $0.90 over cost (18%). If we wanted to use a distributor (and still charge the customer $5) then we would have to sell them for around $3, losing about $1.10 per sale.
If we managed to sell all 750 by ourselves we would only make back $3750 and now we would be $350 in the hole and we don’t have any more CDs to sell. This means we need to do a second pressing and need another $2100 to start the process over. At this point you hope that you have some traction and you may make a little money back on this next round of sales.
Selling the first 750 is an exercise is marketing. You have to tap your friends, you have to start (or continue) playing shows to get the CD out there, you have to push the album and hope you get some press. You have to network with everyone and anyone you can to build the buzz to move the music. At this point, you have pretty much become a label without the benefit of an established distribution and marketing network.
Trying to establish a deal with a dedicated distribution channel (such as a distribution warehouse or CD Baby) for the CD can be a good idea, one that my friends Troll did for their first 2 releases. What you find out quickly is that this is just a distribution point for the CDs and the distribution house will not market you. They are not there to help you sell CDs; they are there to move them when someone asks for them.
In our example, let’s say you do get traction and move the first 750 and have the desire and capital to press the second run. You now enter the second thousand, which is where most album sales drop off. Many small labels consider selling 2000 CDs for a specific act and the label considers this a huge hit for them. I know multiple labels that never press the second 1000, and they still consider it a success if they sell most of the stock.
Sadly, the odds are not in your favor to make any money when doing your own pressing. One of the benefits of signing to a label is they usually have established distribution networks, have dedicated marketing and have networks to help move your music. Starting out on your own, you have to create this all from scratch and this can be an amazingly daunting task.
This is all changing though, with the revolution of digital distribution. Once you get the music made you can skip the production and distribution costs and go directly to market using digital files. You still face the challenge of marketing and networking but at least your initial investment is solely on the music and not on trying to press CDs that will probably just sit in a box in your room.
Note: the process of looking into self-distribution, researching costs, looking at online distributions for the Cell Culture EP is one of main influences on why we started the Fake Science Music Store.
2 Responses to “The Frustration of Self Distribution”
By gse on Dec 13, 2005
Yah, we’ve gone through this exact math a number of times. The sad part was that we ended up not releasing a bunch of things because we knew we’d lose (a lot of) money. So we changed strategies and went a little less “professional” and a little more “DIY”. Results so far seem decent, though they do make me ask myself about marketing.
Related posts: The Wordclock limited release strategy
Some info about our first release of this style
How much success have you guys seen with the “send 250 out for reviews and radio”? Most of our artists don’t/won’t gig much, but I’ve not found that type of promotion to equate to much w.r.t. sales. Great reviews, a couple of interviews in pretty notable magazines — that helped us book better gigs for one band, so they were useful in the big picture, but had no discernable direct effect on sales.
By James on Dec 14, 2005
That’s a great question. Too be honest we dropped the CD idea for Cell Culture due to the costs and jumped right into building the store (and have not yet finished mixing the album, ha!). After talking about this issue with a few local bands and store owners most agreed that it may be better to just sell the CDs then give them away.
There is a fine balance between the two in my opinion. Good press helps build the reputation of the band or the label and can open more doors for following releases. But, does it directly translate to more sales?
It may be that the translation of press to sales can be blocked by some of the distribution issues. Most people want to buy from a “trusted†store front like Amazon or now someone like CD Baby. They have built a reputation over the years as a place to buy music and you will get what you buy. Unfortunately for smaller labels and sites the reputation is not there yet and less people are willing to take the risks of making the purchase from these sites and therefore more people pass on making the investment.
Another possibility is continued press and buzz. A few articles here and there may initially boost a few sales but unless this buzz stays around and grows the momentum can be lost. This means pushing more albums out and cutting deeper into any possible profit. This is where gigging can help, but as you mentioned a lot of acts don’t play out that much. This is definitely something that we are spending a lot of time thinking about and talking to others about. As we come up with ideas I will try to spout them out here.