The music industry could be making up to $2.6 billion more in incremental revenues by offering exclusive, premium content to hardcore fans.
That’s according to a new study by Nielsen, which found that potential revenue of $450m - $2.6bn could be garnered from fans if artists, managers and labels offered them premium products and experiences.
The principle behind the conclusions drawn is that the willingness of fans to pay more for exclusive or premium content, and greater engagement with their facourite artists is being underestimated.
"Fans want more," said Barara Zack, chief analytics officer at Nielsen Entertainment Measurement, during a panel at SXSW. "There is an unmet need there. There is a desire to engage at a different level than what they have."
The Nielsen study found that 53% of the most active music buyers (Aficionados) said that they would be willing to pay for exclusive content from a favourite brand while they were recording a new album.
Even what Nielsen calls ‘Ambivalent Consumers’ – making up 22% of the population and spending $73 on average per year – said they would buy exclusive content if given the opportunity.
Nielsen estimates that the incremental revenue potential from exclusive content is $564 million as an individual buys content from only one band – but $2.6 billion if the same is done across a number of favourite bands.