Tiered pricing for musicMarch 2, 2009
Why should all your fans pay the same amount and get the same thing? We’ve talked about name-your-own-price merchandise in the context of establishing and maintaining a relationship with your fans. Here’s the other side of it: tiered pricing for music and merchandise.
I’m a huge fan of The National. I own all their CDs and bought their DVD. In the last few years, I’ve seen them in concert in Montreal, Boston (two nights in a row), and New York, and I brought people with me to all the concerts. I just bought the benefit CD Dark Was the Night, largely because it was curated by Aaron and Bryce Dessner. And, well, that’s kind of the best I can do for them.
In contrast, Amanda Palmer and Nine Inch Nails both released albums that came with a wide range of extras and a corresponding range of prices. And Josh Freese is taking tiered pricing to its logical extreme, ranging from $7 for a digital download of his album to a $75,000 package that includes him joining your band (or being your personal assistant) for a month, a five-song EP written and recorded just for you, one of his drumsets, and more. For all of these artists, what you choose to pay is therefore a combination of what you can afford, how appealing each package is to you, and how much you want to support the artist. In the days of distribution via physical outlets, this wouldn’t have been an option—there would simply be no way to make sure that the right mix of regular and premium versions would go to any given record store. With direct distribution, however, matching up a fan, a pricepoint, and a package is no problem.
While it’s not a very romantic image, it’s not dissimilar to what airlines do: they maximize their revenue by selling economy-class seats at wide range of prices (ranging from full-price, walk-up seats to ultra-discounted seats sold through consolidators), which reflects what the purchaser is willing to pay. There are a couple of crucial differences, of course: one is that all of the seats are basically the same – once you’re on the plane, no one cares how much you paid for your seat, and the people who paid full price for their tickets don’t get anything extra. More importantly, in the context of art and artists, is that paying more money is not really reflective of a relationship. Much as I prefer JetBlue to its competitors, I’m not going to volunteer to pay extra for my seat to help support the airline. I would, however, pay for extra goodies to support an artist that I really like. And apparently, I’m not alone – the Who Killed Amanda Palmer? package that I wanted sold out while I was in a meeting that coincided with the preorder page going live (argh!), and Nine Inch Nail’s $300 Ultra-Deluxe Limited Edition of Ghosts I-IV sold out in 72 hours.