If you’ve landed on this article page, you’re probably searching for a
good business idea—an idea that’s light on the pocket but heavy on
returns, promising both a fulfilling journey and potential profit.
|
How To Start Record Label Business in
Nigeria
Record labels are companies that manage brands and trademarks,
coordinate the production, distribution, marketing, promotion,
and copyright of music, music videos and music shows of artists.
The term “record label” is derived from the circular label in
the centre of a vinyl record where the manufacturer’s name is
displayed, along with other information. Recording artists have
relied on record labels to broaden their audience, market their
albums, and promote their music on streaming services, radio,
and television. Record labels have publicists, who assist
performing artists in gaining positive media coverage.
A record label business dwells so much on the power of influence
and finance. Recently, record labels rely so much on social
media platforms to promote their artists. The target is to
promote the said artists and their songs among the public. They
undertake all costs of studio sessions, recording, branding,
promotion and marketing in exchange for an agreed percentage of
all profits made from the songs and/or videos produced by the
artist. Record label contracts are bound by legal frameworks,
just like every other business transaction.
If you want to make money in Nigerian entertainment industry,
but you don’t have much in the way of musical talent, you can
start your own independent record label. This is also an option
for upcoming musicians who are having trouble getting signed
with a major label deal.
Business Opportunities In Record Label Business In Nigeria And
Across The World
1). Social Media Management:
Much of the promotion that record labels do happens on social
media because that is the platform where they get to interact
with the public. Such social media accounts are handled by
skilled social media managers who study and analyse the
behaviours, reactions and preferences of the public. They draw
conclusions from such information that help to inform the
decisions made at the record label. Also, social media managers
are in charge of promoting their songs and other label
activities on the internet.
2). Artist And Repertoire (A&R) Department:
Another vital opportunity in record label business relates to
scouting for new artists. The role of the talent scout is to
discover talents and convince them to sign with the label. They
find talent by going to live shows, keeping up with industry
developments and breakout artists, listening to demos, and
networking. When the A&R department finds talent deemed worthy
of a record deal, they lead negotiations between the label and
the prospective artist. They continue to be involved with the
artist throughout their career by either supporting the
recording or promotion processes. The A & R department is the
department that is most heavily involved in artist development.
3). Music Production:
Record labels work with disc jockeys (DJs), sound producers,
sound engineers, studio managers, and so many other experts, to
help their artists make good and marketable songs. Music
production keeps lots of people in job in the music industry.
4). Music Promotion:
In addition to the use of the social media for promotion of
artists, record labels depend on expert promoters to distribute
their artists’ songs to radio stations, internet radios,
satellite radio, podcasts, popular streaming platforms, etc. The
aim is to give the songs as much airplay as possible so that the
public could appreciate the songs.
5). Publicity And Marketing Services:
In addition to promoting the songs, record labels promote the
artists too. This is where publicists and marketing experts come
in to play. The role of the publicity department is to get the
public interested in a product, event, person, or any other
thing being marketed. In the record label sector, the publicity
department is responsible for finding, managing, and scheduling
opportunities for press or media presence, alongside finding
opportunities for artists to get publicity on terrestrial radio
or streaming stages. The marketing department is in charge of
press and promotion campaigns for artists, releases, tours, and
anything else that needs to be sold. The marketing department
works directly with the publicity, sales, and promotions
departments as they execute the plans designed by the marketing
department.
6). Sales And Distribution Services:
With the invention of streaming platforms, record labels pay
less attention to producing CDs and other hardware music units
for distribution. However, the section still creates
opportunities for distributors and marketers. They work in
partnership with creative designers who create album covers,
arts for advertising shows as well as other visual items
relating to the artist in question.
7). Fashion Design Services:
Record labels employ the services of professional fashion
designers to make amazing fashion styles for different occasions
including video shoots, tours, shows, interviews, etc. They also
work with other categories of experts such as make-up artists,
and personal costumiers, among others.
8). Legal Services:
To bind contracts with artists, related professionals, media
giants, and other categories of people they work with, record
labels involve the services of legal practitioners.
1). The Exclusive Record Contract:
Also known as “major label deal”, this deal is a big and
comprehensive one. It is however not as salivating as it used to
be due to significant changes in the industry. Most of these
contracts put artists under the management of a label. The label
advances the artists money in making an album and paying for
marketing the album and also paying for expenses involved in the
process. In return, the artists must pay back all the costs the
record company has spent through record sales and other income.
If the sales aren’t booming, then the artists would have
specific issues with the record company, not to mention a lot of
debt.
2). The Independent Label Contract:
In theory, this kind of contract is the replica of the exclusive
record contract. However, there are so many independent labels
representing diverse kinds of artists. In other words, there are
so many varieties in the real deals that are signed. Sometimes,
this contract allows the artists to retain control of their
rights to their music. It may only cover recording and not
promotion (or vice versa), or any number of setups that are
worked out among the label and artist. It should be emphasized
that a lawyer should review any contract because even agreements
that seem to favour the artist ultimately can have clauses that
could be very dangerous for the artist in certain situations. It
is always best to fall on the side of caution.
3). The 360 Record Contracts:
This form of contract was developed some years ago. Essentially,
this puts labels in control of all aspects of an artist’s
career, including touring, publishing and merchandise, in
addition to record sales. In exchange for providing these
artists with more support and money, all revenue is also split
with the label. Since this is a relatively new kind of deal, the
overall advantages and disadvantages for artist and labels are
still being determined.
Music is a commodity people can’t do without, which, therefore,
makes it a profitable enterprise for everyone, not for its
financial gain alone but for the services it provides to man.
Although technology has provided various platforms for an artist
to showcase their art, the benefits derived from working with a
record label is still profound. The record label business in
Nigeria can be a lucrative and profitable venture to start-up,
due to its vast market demand and on your ability to build a
wide network. If you’re looking for a lucrative business to
venture into, the record label business in Nigeria is a great
option to explore.
How Does A Record Label Make Money?
Sales & Streaming: Artistes and record labels earns from direct
sales and online streaming.
Performance Royalties: You collect performance royalties when
your song is played on the radio or live at a show.
Merchandising &Ticket Sales: Artistes and labels can always earn
some extra cash at live events and online by selling tickets and
music merch such as T-shirts, Hoodies, Posters, CDs etc.
Most record labels don't make money, but if you run it properly,
your label could be of great assistance to an artiste. If that
artiste does well, then your label will make a portion of
everything the artiste makes and that's the reason why you need
to consider a partnership agreement between your artistes, trust
me its going be a long lasting relationship for you both.
Get our Practical training guide on how to set up a record
label. If you have always wanted to start your independent
record label and you’re wondering what the requirements are for
one to start a successful record label then this is your answer.
This guide will provide an in-depth look at what it means to be
an record label owner , the key roles and responsibilities, how
they get paid, and essential do's and don'ts.
|
