Wednesday, August 15, 2012

Music venues, profit margins, and the worth of musicians

Last week, I wrote a post in response to the degrading relationship between musicians and venues (read it here). 

While it's one thing to complain about the way things are, it's another matter entirely to try and devise solutions. This could easily segue into a rant about politics, but that's a discussion for another time.

Let's face it. Both venues and musicians want to make money. The common model for original acts has the venue making money from food and drink sales and the musicians making money from tip, CD/merch sales, and/or the cover charge. At its core, the model is not terribly unlike way large headlining acts work, only on a smaller scale. The venue provides a place to play, the act provides the fans, and money is made. 

Venues have to:
... pay the rent and bills
... buy the food and drinks to sell
... pay the employees
... buy and maintain the lighting, PA system, and any house instruments

All of that's pretty expensive and, like most businesses, completely dependent on how many people patronize your spot. As a venue, you want live music to attract more customers and keep them there longer.

Musicians want:
... to play in front of a decently-sized, appreciative audience
... turn patrons into dedicated fans
... be compensated for their efforts

It's on that last bit where things get hairy. Sometimes, musicians are content performing for free food and drinks. Often, those tend to be weekend warrior musicians who have a career and see music as a hobby. But who doesn't mind making some money? Let's try looking at it another way.

Let's say, hypothetically, that you as a venue were going to pay musicians minimum wage (what Chris Rock refers to as, "I'd pay you less, but it's against the law"). You hire a four-piece band for four hours of music. The minimum wage in my state at the time of writing is $7.25/hr. Multiply that by 4 people and you get $29/hr for the band. Multiply that by the four hours you want them and you come-up with a $116 total. Ah, but when you pay your employees, the clock starts ticking once they begin providing services (I'm thinking food prep and cleanup for a restaurant/bar). Let's add another hour for set-up and break-down because you decided that band can bring their own PA, amps, and drums. The total is $142 to pay a 4-piece cover band at minimum wage for four hours of music.

As a restaurant, you'd have to sell fourteen $10 dishes (and some change) or nearly thirty $5 drinks to just to pay the band (again at minimum wage), and that's not taking taxes or your own expenses to make the food/drinks into account.

So then there's the question: what's live music worth? What's it worth to the venue? What's it worth to the musicians? What's it worth to the people who listen to it? There's a lot of doom and gloom about the abysmal state of the music industry. We hear terms like "fall of the record labels," "flooded market," and the constant tearing down of the Justin Biebers that emerge. 

My generation is a product of the self-esteem movement. We grew up being told that we're all inherently special and unique (a logical fallacy) and deserve nothing but good things. However, does that mean that all musicians deserve to be able to make a full-time living? Of course not. The default answer is, "The good ones should be able to." Well, who are the good ones? 

Take a look at any prestigious music conservatory. Those are full of some of the most refined, highly trained, highly skilled musicians, yet, the classical music world has its struggles. Walk into a local open mic (here's a great resource to find one near you) and you're likely to see a mix of incredible, homebrew talent and people who just do it for fun. Each generation manages to find their stars. Those stars will make a lot of money. They might not be the best in their instrument or songwriting or live performance, but they are the best at capturing popular attention. 

This is all a round-about discussion to explore the idea of what musicians are worth financially. The easy answer can be boiled down to simple supply and demand. The more demand for a musician, the more that musician is worth. For a growing, independent artist, the main career move is finding out how to create a demand for his or her music. To a venue, a musician is only worth what he or she can draw. A crappy band that can bring out 100 people is a heck of a lot more valuable for a business than a really good band that has no fans. 

With the constant media blitz, it sometimes feels insurmountable to break through the clutter and get people's attention. People can carry days worth of music in their pocket and taylor what they listen to at a whim. Anyone who is Facebook friends with a musician probably gets show invites that he/she has trained himself/herself to immediately ignore.

So, one more time, what are musicians worth? Ask their fans. Ask the people that hire them. Musicians can't hide behind the current state of the industry for being unable to reach people. Every artist is a product of the times in which they are living. Venues, do your research to attract good, interesting musicians. Be straight with your expectations. If you find the entertainment to be valuable, pay for it. Just the same, musicians, do your research about venues and be realistic with your expectations and needs. If your local venues simply aren't doing it for you, innovate and find/create your own! (It's certainly something we should have done in the events described in last week's post.)

Next week: DJs versus live music.

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