In an industry as competitive and fast-moving as music and entertainment, startups must act fast to get to market. But the result can be a technological mix of quick fixes, temporary solutions, and manual processes that aren’t scalable.
As they grow, they find that their decisions and technology choices (like opting for off-the-shelf tech solutions) were appropriate for the early stages but have rapidly become a roadblock to scaling. And with the growing importance of digital products in the music industry, scaling fast and seamlessly can mean the difference between long-term success and being a brief blip on the industry radar.
In short, you need a technology solution that focuses on your unique value proposition and path to success.
It Starts with Strategy
Reactionary decisions will sideline companies with a great vision but no plan to get there. That’s why successful growing companies take time to define a thoughtful product strategy that saves effort while establishing their market presence.
Product strategy is the foundation for scaling and sets the tone with two main questions. Who is our customer? And what do they want?
As a startup leader, the answer to these questions will determine your choice of technology, product team structure, market strategy, business objectives, financial investments, and measures of success. Product strategy gives you clarity into all of those and instills structure, discipline, and focus for the scaling organization.
Successful companies have a clear plan of what they can achieve with assigned goals and milestones. They balance the complexity of building a sustainable technology platform without being overly ambitious or optimistic about their products.
More importantly, they can pivot as the artist-fan relationship evolves.
Avoiding the BIG Tech Mistakes
A product strategy investment pays off by providing a roadmap for scaling companies to reach their target market with music and products that grow their fan base.
By far, the most significant risk to a scaling company is building the wrong product. If your digital offering doesn’t bring value to your customers, is delivered at the wrong time, or uses the wrong technology, your end users aren’t going to adopt it and your organization will flounder.
Choosing the right custom technology, supported by a rock-solid product strategy helps mitigate one of the most significant risks that can derail your company’s success.
Unfortunately, off-the-shelf (OTS) technology can prevent artists from achieving their vision and hinder scaling their company. For instance, today’s music platforms must offer an engaging fan experience while also integrating with the legacy systems of giant music companies. If your OTS solution can’t meet that need—or the myriad of others you’ll need to successfully launch and scale—you’re already a step behind.
Artists have a unique value proposition: They know how to deliver a top-notch fan experience. But they must also provide value for fans and take advantage of emerging ways to monetize their music beyond traditional royalty and compensation business models.
Monetizing music, art, and content presents new challenges. For instance, as music distribution becomes more democratized, artists are challenged to build custom ecosystems that support paying customers, users, live events, business partners, operations, financial systems, and more while allowing for future growth. As a result, scaling music companies outgrow their initial technology choices and require custom technology that meets user, market, stakeholder, and business needs.
Fresh, engaging content is where music companies have an edge. The RIAA reported that in the first half of 2021, Americans listened to 840 billion on-demand song streams, a new record. Moreover, the music industry continues to offer room for growth: Audio streaming and audiovisual platforms (like TikTok) drew over $6 billion in recorded revenues in the first half of 2021.
Reaching global markets requires a clear roadmap that attracts new subscribers and grows revenue. For that reason, scaling companies require an exceptionally well-designed product strategy: They need to know who their fans are, what experiences or content they want, and what products will make them paying customers.
The Role of Product-Market Fit in Tech Selection
Discovering whether the target market likes or engages with the artist’s content is a wake-up call for growing companies. Music firms may find it difficult to determine their product-market fit, especially if:
- The company is trying to be everything to everyone.
- The actual product users are different from the perceived users.
- The company is pursuing a customer base that doesn’t like or need the product being sold.
Scaling a company requires finding the right product-market fit to achieve customer acquisition goals. The Startup Scaling Research Project identified critical components of a successful product-market fit, including:
- Targeting a homogeneous market
- Launching products with a high “must-have” appeal
- Offering easily accessible products (e.g., mobile-ready platforms)
- Creating products that require frequent use, several times each day
- Offering products that motivate customers to tell others to use the product (i.e., via social media)
It’s unlikely that OTS solutions will be able to achieve even a fraction of those needs. And relying on non-custom tech can create issues down the road:
For example, oftentimes founders will buy into a solution in the startup phase that supposedly offers everything needed to grow, only to find it doesn’t quite meet their needs. This why it’s essential to have your product strategy in place first to determine if that highly-touted software will support growth goals.
It’s also common to prioritize an exceptional front-end experience for users that they may not need. Before spending time and money on a fancy front end, companies should check their product strategy to see if it provides customer value.
Custom technology helps music companies overcome the expensive distractions of all-inclusive software while supporting a product-market fit. As companies expand and reach new markets, they’ll become more dependent on custom technology to build and distribute products that engage and convert users to customers.
Your Goals Aren’t One-Size-Fits-All
As part of a larger product strategy, technology democratizes music, audio, and video distribution, helping to grow the customer base and acquire new customers. Too many scaling companies make the mistake of believing the technology that made them a successful startup will also guarantee they can scale successfully.
Too often that’s not the case. A fast-moving industry, insights gained from early users, or changing business needs also change what an organization needs from its digital offering. And that translates to big changes from the MVP.
Investing in custom technology is the surest way to guarantee that the platform you’re building not only serves your current users, but can also keep up with your company’s growth in the long term.
Looking for a development partner with deep media and entertainment experience? DockYard has worked with some of the biggest names in streaming, music, and more. Get in touch today and let us know how we can make your success happen.