The only thing that’s certain about the future of social media, is that it’s uncertain.
For the last few years we’ve discussed some of the reasons we believe that the future outlook of social media continuing to be heavily ingrained in almost every stitch of our culture may not be so bright, and now the financial picture for the top social media platforms may be showing us that there is indeed a crack in the foundation.
Take a look at the stock performances of Facebook (which also owns Instagram), Twitter, and Snapchat…Yikes! Facebook is probably going to finish the year significantly lower than where it started for the first time ever. Twitter which has been rising at a pretty remarkable rate since mid 2017 is down to $32 from it’s $48 high a few months ago. And SnapChat…well… is headed for terminal decline!
So is this just some correction in the market? Is it the beginning of long-term trend? What’s happening and how does it affect musicians/bands/singers? And how does it affect our scene specifically?
I’m not going to pretend that I’m a stock market analyst and know the technical in’s and out’s of what’s causing the downturn, but I think there’s a lot of info even the layman can get from looking at the trends.
- This is an industry trend, not a company one. The downturn is happening to all three companies; not just one. So what’s causing this is representative of speculation based on the social media in general, not specific to an individual platform.
- Instagram is owned by Facebook, and is by far the fastest growing platform, yet the optimistic outlook it’s currently providing is not enough to offset the pessimistic outlook of Facebook.
- These companies make money by selling advertising space, so a declining stock performance likely represents a declining sentiment towards its ability to sustain its growth in advertising power.
Pair these assertions with the assumption of the burnout people are experiencing from being fully entrenched in social media for over a decade, the data leaks, the desire for more privacy, the desire to avoid a hostile political and social climate, and the thousands of other options we can choose to do with our time, and it looks we’re likely entering a phase where the long-term outlook of social media has never been more gloomy.
Take all of this and combine it with the fact that the traditional “mass appeal”, “mainstream”, “pop culture consensus” type of media is not doing so well and now we start to really see the big picture. Hollywood and the networks are getting killed by Netflix and YouTube. Cable is getting killed by streaming. College kids and younger consume most of their music through Spotify, Apple Music, and YouTube. Newspapers are collapsing. Magazines are collapsing. Every news outlet that’s on TV is desperate for ratings for survival and award shows have never been less relevant. This generation of consumers finds their specialized pockets and deep dive into them. They find the Netflix shows they can binge, the playlists they like, the podcasts they can immerse themselves in, the news they know they’ll agree with, the websites/apps they like, their YouTube channels, and shut everything else out.
Luckily you can reach these consumers on social media. But what if social media continues to make reaching your target audience increasingly difficult and more expensive? And even if you are able to reach them, what’s to say that it even gets noticed due to the ever-increasing bombardment of information currently taking place? Where do you turn?
This is where it really starts to get complicated. Right now the answer is… there isn’t anywhere else to turn. Your options are social media, radio, TV, websites, email, print, billboards etc..So do companies continue to put money in these outlets, even if they’re not providing as lucrative of a return as they used to? I guess…but who knows? It’s hard to imagine a world where advertising dollars aren’t making the world of media consumption go around, but look at Netflix, Spotify and Apple Music. All of these exist as a whole (or in major part) outside of the realm of the advertising dollar. They operate on the subscription model and since they offer a product/service that provides cost savings, more options, and easier accessibility, the model looks to be pretty sustainable (at least in regards to customer acquisition).
Netflix, Spotify, and Apple Music reign supreme in controlling the eyes and ears of consumers, yet have very little options to effectively and efficiently advertise on them. If you can’t promote there, social media is no longer providing a viable solution, and there aren’t any great alternatives how will this affect the music scene and our scene specifically?
Here’s a poorly constructed metaphor to help me explain how I look at it: The music marketplace used to be like a river. Content was fed to the consumer downstream with a narrow and targeted approach (radio, physical retail, early years of social media & iTunes); this empowered the producer (especially the ones who were higher upstream). Now the marketplace is becoming an ocean. It’s almost impossible for the producer to control and the consumer is free to swim where they want. There are waves and currents that push the consumer in a certain direction, but they primarily occur naturally. Sure there are a few people who have the ability to create waves, even some big ones, but as the ocean grows, the significance of a few big manufactured waves will only continue to decline.
So much of the mainstream music business operates under the MO of mass appeal. They want to reach as many people as possible, and therefore need outlets that reach the masses. Because of this, they have a business model based on a broad consumership, but as I discussed earlier, it’s becoming increasingly harder to operate financially and marketing-wise with that approach. These business models require a heavy promotional budget; but if that money doesn’t go as far as it used to keeping the current fan base informed and reaching new potential fans, how could more dire consequences not be around the corner? But what may be rough waters for the big music business, may not be so bad for us, especially if we continue to keep the community and infrastructure of our scene strong.
Niche systems (like our scene) are generally more efficient, more mobile, can adapt quicker, are often more creative and innovative, can be navigated easier, and operate without big money. If the music marketplace is now an ocean, our scene is a bay. It’s more protected from the elements, it’s easier to navigate, it’s not overwhelming and it’s more condensed. Better yet, it has a more specific identity. If you’re looking for it, you can find it. People can go in and out of it, but it’s easier to keep track of the comings and goings and spot someone new. This in turn could provide a lot of benefit for consumers looking to stay informed and for producers looking to do the informing in a world where social media can no longer be heavily relied upon. The size of our scene which used to be viewed as a limitation might actually prove to be strength. A smaller community with a stronger identity makes it easier for consumers to find it, keep track of it, and explore it. People want freedom and choice in the marketplace, but they also want a guide to help narrow them down. Something that offers suggestions, but doesn’t impose limitations and I think our scene offers a way to keep track of artists and their music, but in a noninvasive and complementary way. It’s here if you want to dive in to it, but it’s not overwhelming.
One of the key aspects of advertising is impression rate: how many times a consumer is exposed to the brand, and I think the community and infrastructure we have in our scene provides a solid way for artists to stay in front of the fans, keep them informed and help them discover new artists/music that’s not completely reliant on an individual artist’s social media pages. We have small number of charts, stations, websites, venues, festivals, playlists, and established tastemakers that are usually all clued-in and offer exposure in their own way; usually without any concentrated effort on formally working together. You get artists promoting the venues and festivals, then venues and festivals promoting the artists, the stations promoting the artists, the stations promoting the venues, the artists promoting the stations, the websites covering the artists, the artists sharing the content of the websites, the charts covering a large proportion of who’s actively pushing music, artists promoting other artists, etc…It provides a lot of cross promotion in a space that’s not too large, so there’s a good chance fans can get exposed to an artist’s music from multiple angles. It works, and will continue to work on this level, but there’s just too many players and too many directions to go for this to work on massive scale. Traditional and mainstream channels are getting spread so thin and the bigger the area, the less chance of the consumer getting any cross promoted content and multiple impressions from different sources. To me ,that spells trouble for mainstream music in an era where you can’t rely on social media.
Artists who are building their following organically, through word-of-mouth and road-doggin, who don’t rely on big promotional budgets and have a foundation in a scene that’s easily navigable for consumers, is where I’m willing to put my money. Yes, the drying up of the social media well will definitely affect our scene, but if we can continue to hold our community and infrastructure in place, I think we can weather the storm that could be brewing in the next decade better than most…and we may even like what we see on the other side of it.
A Couple of Side notes: Build your Spotify following and those email contact lists! Also, I’m probably the most bullish on Twitter. It’s the best search engine to keep track current events and breaking news. It’s not overwhelming but allows the user to do enough to satisfy their need for expression. It’ll probably weather the storm better than the other platforms.