Supply and demand in the music industry

A few days ago I sent out an article I wrote, called “The #1 Problem With The Music Industry” to my email list.  In that article I articulated why I think the biggest problem with the music industry is that there are too many musicians, in the sense that the supply of musicians outweighs the demands of the marketplace. I see this as the biggest hurdle most musicians will face, when it comes to creating a career in the music industry.

This was a really well received article, I received quite a few positive responses via email and many people who were in agreement with my assessment of the music industry.  However, I also received a few replies from people who seemed pretty discouraged by some of the statistics I pointed out.  I even got one response from someone who had decided to basically quit the business because of the statistics I pointed out.

I would like to address those that were discouraged by that article in today’s post.

Knowledge Is Power
In order to make an informed decision about anything in life, we need to take in as much data as possible.  Of course, we’ll never be able to assess all the data related to any given situation.  There’s simply no way of knowing all the different variables that are at play in something like the music industry.  There are far too many people involved in the industry, and far too many factors at play to be able to dissect all the different moving parts that make up the music business.

It's sort of like sizing up a potential dating partner.  It’s impossible to know everything there is to know about another person.  So, instead, we get to know people the best we can, we meet their friends and family, we spend quality time with them, and in the end we make decisions about people using a combination of logic, intuition and heart.  If we’re lucky, we make good decisions and surround ourselves with quality people and with quality partners.  Sometimes we let our emotions over ride our logic and we ignore red flags that are warning us to move in a different direction.  Conversely, sometimes we let our logic and intellect convince us to not give people a chance that would actually be very good for us.  We don’t always get decisions right.  We live and learn.

But, the more information and data we have going into a situation, the easier it is to make a decision that is right for us.  There are a lot of marketers and bloggers that gloss over certain realities of the music business in order to sell books and programs.  It’s easier to sell a program about how to make money in the music business, when you convince people that it’s easy to make it in the music business. 

But, I’ve said it before and I’ll say it again, my primary goal with my website and resources isn’t to make money.  My primary goal is to educate and inform people about the realities of the music business, and in particular the music licensing business.  The good, the bad and the ugly.

I don’t think the competitive nature of the music industry or the fact that it’s a relatively hard industry to succeed in should be overlooked.  In fact, I think it should be embraced and fully understood.  You need to be able to look at this business, for what it really is, square in the eye, in order to make an informed decision about whether or not you want to enter into it. You’ll also have a much better chance of success if you fully understand the reality of the business and what you’re up against.

Perspective
With that said, you still need to have a healthy, big picture perspective of the music business.  For example, in my previous article I pointed out a study that indicated that 90% of artists are completely unknown.  Some of you took that to mean you only have a 10 % shot at any sort of success in the music industry.  But, of course, that’s not how statistics really work.  The study I pointed to simply reported that the vast majority of music artists out there are basically unknown.  But that doesn’t reflect your individual odds of succeeding in the music business.

Maybe 90 percent of the artists surveyed are completely slackers with no work ethic.  Maybe the vast majority are hobbyists who are also balancing families and careers.  Maybe half of all the artists surveyed don’t even aspire to be full time musicians.  The problem with statistics and data is that it’s impossible to tease apart all the different variables.  Can we really know hard the competition wants to succeed?  Can we really quantify how badly someone else wants to make it in the music business, compared to your own desire to make it as a musician? Maybe you are part of the 10 percent who have what it takes to succeed?  Or, maybe you’re part of the 1 percent that go on to become ultra-successful in the music business.  There’s really know way to know these things using statistics alone.

Defining Success
You also have to really look at the big picture, in terms of how being a musician factors into your overall life satisfaction.  In other words, how much happiness do you derive from spending your time playing and writing music?  Do you prioritize money and security over pursuing meaningful work?  Would you be happy earning slightly less than the typical American or European (or elsehwhere) worker if you were able to make your living doing something you love?

The average professional musician earns $39,899.00 per year in the USA.  That’s not a ton of money, relatively speaking.  But the average person in the USA only earns $44,564.00. For an even larger, big picture perspective, consider the fact that if you make over $32,400.00 you are in the top 1% of income earners in the entire world!  I realize that in certain areas of the USA, or other parts of the world, that would be very hard to live on, but I find it incredibly helpful to take a step back and look at just how much money, even a modest salary in the west is, relative to the rest of the world.  Part of being successful is having perspective and knowing just how good you have it, even if you haven’t “made it” on the level of someone like Justin Bieber or Ariana Grande.

Again, these statistics are averages, and you could earn much more or much less than these figures, in or out of the music industry.  But, success isn’t just about overall money earned, it’s also about other things, that are harder to quantify, like a sense of personal meaning and overall life satisfaction; things that are harder to measure, but are of vital importance to the quality of your life.

Summing Up
My goal is to provide the most accurate, up to date information about the music licensing business and the music business at large.  It’s easy to get cynical about the music business and it’s easy to get discouraged.  But in many ways, I don’t think succeeding in the music business is that much different than succeeding in other industries.  A small percentage of people make it to the very top of most industries.  How many multi-millionaire CEOs are there compared to minimum or low wage workers?  How many rich entrepreneurs are there compared to entrepreneurs that struggle to get by?  I’m not going to bore you with more statistics, you can look them up if you're interested, but I think you get the point.

Succeeding at a “rock star” level in the music business is hard, because it’s special.  It’s not something everyone gets to do or can do, and that is what makes the goal so appealing.  If it was easy, everyone would just decide to be a rock star, and then it wouldn’t really be that special. 

Being a musician isn’t for everyone.  In order to know whether it’s right for you, you need to deeply understand both the business and be very self-aware about how much talent you actually have.  Do you have something truly unique and special to share with the world?  Do you have a burning desire to share your talent?  If so, in my opinion, you owe it to yourself and the world to chase your dreams!

Because remember, even if you don’t “make it” in the way that maybe you dreamed about when you were a teenager, even if all you ever become is a musician who succeeds on an “average” level, you’re still doing pretty damn good by virtue of the fact that you’ll be making way more than 99% of the entire world, doing something you love.

Think about that.
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Here’s a video that sums up this article pretty well that I posted to my Youtube Channel recently.

On a positive note, here's a video I posted to my Youtube Channel a few years ago, that breaks down a straightforward way of making 60k a year as a musicians working 25 hours a week.