Radiohead

In the latest of his Lefsetz Letters” (not yet online) Bob Lefsetz touches on the strategy behind Radiohead’s “pay what you want” album release: How do acts establish a direct connection with their fanbase? How do they entice listeners to join their e-mail list, with authentic e-mail addresses? That’s the number one lesson of Radiohead’s “In Rainbows.” Give away something desirable and you get the right to make contact with your fans thereafter. At MIDEM the co-manager of Radiohead said the “In Rainbows” release allowed the band to collect 3 million e-mail addresses, and ultimately play to 60,000 in San Francisco as opposed to 25,000 the previous time through. And isn’t live where it’s at? ...

As noted by Digital Audio Insider, lots of economists seem to think that what Radiohead is doing is analogous to working for tips; Bob Lefsetz thinks so too. Folks, let me ask you something: When you last went out to dinner, did your waiter or waitress ask for your name, email address, postal address, telephone numbers, and for permission to contact you with information about other services they could provide to you? And will they use this information to create a customer database to do targeted direct marketing to you and all the other people they’ve served, using the amounts of your tips to tailor their marketing appropriately? I’m guessing that they didn’t and they won’t. ...

Now that the hubbub about Radiohead’s new release has died down, there are a couple of things worth adding to the analysis from various sources I’ve read, including Hypebot, Bob Lefsetz, Digital Music News, and Contentinople. (I haven’t of course read every commentary on Radiohead, so it’s possible that someone has said these things before me and better than me—I don’t do this for a living, you know.) First, I think people are missing a crucial point about Radiohead’s “name your own price” strategy. It is not all about giving listeners what they want, namely DRM-free music that’s free (or nearly so); it is also about giving Radiohead something it apparently wants (and that it could not get working through a major label): deep information about its listener population beyond the hard-core fans (i.e., those who’ve already joined the Radiohead fan club), including in particular information about which listeners are good candidates for up-selling strategies aimed to move more Radiohead merchandise, tickets, and other Radiohead-related products and services. ...