The enduring value of record labels in today's digital age
THE music industry has undergone a seismic shift in the digital age. The rise of streaming platforms like Spotify and Apple Music, coupled with the explosive growth of social media, has democratised music creation and distribution.
In Malaysia alone, the revenue in the digital music market is forecasted to reach a staggering US$73.65 million (RM346.85 million) in 2024, with music streaming being the largest segment .
Despite the significant changes in the music industry, record labels, which have long been the driving force behind many artists' success, remain a crucial part of the ecosystem.
They have transformed their business model and strategies, functioning as partners for artists, navigating the complexities of the streaming economy and maximising their exposure and potential for success.
Discovery and Promotion in a Crowded Marketplace
In Malaysia, the digital music market is rapidly growing, driven by fans' engagement with music on streaming services, especially that made by local artists. It can be a challenge for artists to stand out on an already saturated platform, and here's where record labels shine.
Labels are able to leverage their well-established network to create buzz and amplify an artist's work. Strategic social media campaigns and targeted online advertising can get artists noticed, which is especially crucial for launching their careers.
This expertise in promotion extends to global markets. Labels orchestrate marketing campaigns across different territories, ensuring an artist's work doesn't get lost in the shuffle.
Strategies like playlist pitching, social media promotion to drive streams, and exploring alternative revenue models such as premium content, exclusive merchandise bundles, are all part of the label's toolkit.
A great example of this is the amplification of "SAH" by Sarah Suhari and Alfie Zumi.
Warner Music Malaysia's efforts helped the song reach wider Indonesian audiences, resulting in a Top 50 chart placement. This success story highlights the label's ability to leverage digital streaming platforms and social media discovery tools like TikTok to maximise an artist's reach.
The Curated Connection: Finding What Matters
In the age of self-produced music, finding the right sound can be a challenge. Here, A&R (Artist & Repertoire) teams within labels play a vital role.
They provide invaluable feedback on songwriting and production, and connect artists with seasoned producers and songwriters. This collaborative approach helps artists refine their sound and ensures a polished final product that resonates with listeners.
Building Sustainable Careers for Artists
Labels provide the necessary funding for recording, production, and tour support, allowing artists to focus on what matters most - their creative work - without immediate financial pressure. The guidance and resource support labels provide therefore enables artists to create a foundation for a financially viable career.
Artists can generate income from sales or streams of their songs, but their recordings can also help unlock other sources of income, which is where labels can help with placing music in films, TV shows, games or adverts; forging partnerships with brands; and creating a merchandise offering. They can also help artists navigate the complex worlds of music publishing and touring.
The success stories of Bunga and Luqman Podolski is a testament to this. Warner Music Malaysia helped transform Bunga from a raw artist to a polished performer, achieving success across song releases and brand partnerships, and recently served as the opening act for Coldplay in front of an 80,000 strong crowd.
Similarly, Luqman Podolski, once known primarily as a content creator, was successfully established as a top Malaysian artist under the label's guidance, even winning a Spotify award in 2023 as the #3 Local Artist in Malaysia.
The Data-Driven Future of Music
Labels are heavily invested in data analytics to understand listening trends as well as audience demographics and preferences. This data informs creative decisions such as album curation, marketing strategies, and even the development of artist profiles. By catering to fan expectations and promoting music that resonates with the right audience, labels help build a stronger connection between artists and their fanbase.
For instance, Warner Music Malaysia leveraged data for a recent Indonesian tour for Malaysian artist Masdo to determine the most targeted cities for his promotional tour, resulting in a 10 per cent increase in streams. This data-informed approach allows labels to measure the impact of campaigns and optimise artist growth across different markets.
The digital revolution has undoubtedly reshaped the dynamics of the music industry. Forward thinking record labels like Warner Music Malaysia haven't just evolved; they've thrived and are leading the charge by embracing technology, data insights, and a commitment to collaborative artistry. This translates not only into success stories for artists but also into a robust and profitable future for the entire music ecosystem.
*The writer is the managing director of Warner Music Malaysia