Topsin is a music marketing and sales platform that focuses heavily on the use of data in spotting trends in buyers' habits as well as analyzing marketing strategies. The founder Shamal Ranasinghe recently released Topspin's findings to the public, and they are very interesting.
The data shows that many music buyers are willing to spend $10-15 extra if it means they get a physical good or premium product, such as a limited edition, a tshirt, or a box full of all kinds of goodies.
The study also showed that "more than half of the transactions in the Topsin study are under $10, but they only accounted for 17% of overall revenue. Rather the majority of revenue for most artists came from items priced $25 and over that included physical items."
This leads back to our discussion in class last Wednesday about the value of a product. We talked about "true fans" who are willing to spend more than the average price to get the limited edition product, and that the artists who use this gain a significant profit by having this option.
This data would show that idea to be true. Although many people just want to spend the $7.99-9.99 on iTunes to get the album (or, download it for free) it seems that if an artist markets to their core fans with a product that provides a physical item, they will still make a good profit.
--- Ashley Snider