The importance of digital music distribution

The creative process of an indie artist is always the starting point for any musical career. But from the first notes and words to appear on paper until a sold-out venue there is a long way to go. Figuring out how to get music on Spotify often seems like a challenging task for independent artists. Let’s take a closer look at the importance of digital distribution in the music industry.

What is a digital distributor?

A digital distributor is a music distribution company providing an online platform, which artists and record labels can use to upload their releases to a streaming service like Spotify, Apple Music, Amazon, Deezer, YouTube and Beatport. Most distribution platforms are also connected to royalty accounting software, completing the supply chain for digital sales of music.

One of the biggest digital distributors is CD Baby. It is a music distribution service that delivers to practically all digital platforms. Other household names are Ditto Music, Horus Music and Symphonic Distribution. Some of these also offer physical distribution, besides delivering fresh tunes to for example YouTube Music, Amazon Music and Apple Music. Keep in mind that not many of these allow unlimited releases.

Distributors offer extra services such as help with music marketing and promotion, delivering to neighbouring rights agencies, creating artwork, radio airplay and music analytics.

Create your own label

Signing with a music distribution service means, in most cases, that you should register your own record label. This is because most DSPs do not accept unsolicited releases or releases directly from an independent artist. A good digital music distribution company can help you set up your own label.

The golden marketing rule in successfully launching a product is ‘50% focus on product development and 50% focus on distribution. Lots of artists get stuck in the creative process and dedicate too much focus to perfecting their musical work. Quality is of the utmost importance, but some artists tend to get stuck in a ‘bubble’ and lose track of the bigger picture.

The bigger picture means a record can only be monetized once it has been distributed. A manager plays an important role in giving the artist the right focus.

What to look for in a digital distributor

With so many distributors around, we highlight the features you should look out for when searching for the perfect match:

The number of connected DSPs

Not all distributors have the right amount of deals in place to deliver to a wide array of digital service providers like Amazon, Spotify or YouTube. If you want your music to be distributed globally, to as many platforms as possible, make sure to look for distributors who can provide this service.

If you only aim for music sales locally in your own territory, this, of course, does not apply.

Relationships between distributors and DSPs

Equally important is how well a distributor and DSP co-operate. When signing a track to a record label, a label manager is often responsible for maintaining a solid relationship with a streaming platform. A good digital distributor can promote and prioritize your content to big DSPs, as an extra push to filling out priority submissions on f.e. Spotify for Artists. Besides that, not all distributors receive a daily feed of data about sales and streams. Flying blind when working on a marketing campaign can be a tricky thing.

Distribution fee

There are several ways a music distribution service charges for its services. One of them is charging a percentage of the revenue generated. In some cases, distributing music is for free and the distributor only takes a share of the royalties. No streams mean no revenue for the artist or the distributor. For example, CD Baby charges a fee for distributing music.

Another way of charging for services is to pay an upfront fee. For example TuneCore, they charge almost USD 50 per distributed album. The upside of this model is that usually, the artists receive 100% of the royalties collected. So in case of a huge hit, the distributor only makes USD 50 revenue whilst the artist gets all the royalties.

A third method is a hybrid of both; charging a (smaller) upfront fee and a small % of the royalties. Often this way of working also includes additional services like marketing and promotion, or in some cases mastering.

Reporting

Not every music distributor reports in the same way and frequency. Some report monthly, others quarterly and some even semi-annually. An important note here is that distributors always pay royalties collected from DSPs, when the DSPs have made their payments.

DSPs like Spotify, for example, report at least 2 months after the end of a month.

The format of reporting is also important to look at. PDFs might come in handy for a quick overview but detailed Excel files are needed to pay each contributor its fair share.

Kwettr offers monthly reports, as pdf and as .xlsx. Sent automatically by email every month.

Online platform

An obvious one, but a good distributor of online content must of course offer a state-of-the-art online platform. An artist should be able to upload new music, and manage and track all of his content 24/7.

The Kwettr platform offers a distribution deal and marketing services all in one place, including support on social media.

Access to data

Having access to a good platform is one thing, but being able to download reports, and see trends, analytics and statements are also important for any artist. There are lots of differences between digital distribution platforms when it comes to the accessibility of assets.

Music promotion

Besides pitching music to DSPs, several distributors also offer music promotion services like creating press kits, promotional mailings and in-house marketing tools. Sync licensing, radio promo and reporting to collecting agencies is also an extra service of distributors.

Music publishing

Keep in mind that music publishing is also a very important part of the business. Not all independent artists have a publisher. Music platforms pay publishing royalties on recorded music to collecting agencies. There are digital music distributors around that offer such a service, or big record labels such as Universal Music Group.

Making the difference: music marketing

The biggest difference between most digital distributors and Kwettr is that Kwettr has a long history of promoting music. Kwettr started as a business unit of a record company, focusing on promoting music. Kwettr acts as a distribution partner; customers are assigned an account manager.

A Kwettr account manager helps you plan your releases, focus on the right DSP and advise the use of social media.

Kwettr Growth Packs include YouTube and Spotify marketing. 

YouTube marketing means promoting your music videos, making sure the stream count is raised and more interaction takes place with fans.

Spotify marketing places your tracks in large user-generated Spotify playlists. Your tracks will have an increased reach on Spotify, more streams and a higher chance of being included in more playlists by users and Spotify.

Takeaways:

• Distribution and promotion: services which go hand-in-hand
• The number of DSPs connected varies between distributors
• An online platform with analytical data is important