Friday, February 7, 2020

‘You can make decent money in Italy out of streaming – but physical still maintains some strongholds.’ | Music Business Worldwide

According to IFPI statistics, Italy was the world’s 12th biggest recorded music territory in 2018 – contributing some $269.4m to the wholesale revenues of artists and labels.

Like many European territories, the market has undergone something of a cultural transformation in the streaming age, with local artists, particularly rap artists, making a splash on the national chart.

Those IFPI stats give a sense of the market progression: in 2018, streaming contributed 41.5% of total market revenues – a market share than that seen in Germany (37.0%) but smaller than, say, the UK (49.2%) and the USA (55.7%).

As new and outside investment continues to pour into the global business, some big news emerged out of Italy towards the end of last year: Italian distribution company and record label Artist First announced plans to launch a €2m ($2.2m) ‘mini-bond’ raise as part of “an extensive acquisition and growth strategy”.

Founded by Claudio Ferrante (pictured) in 2009, the Milan-based company has 50 employees and reported a turnover of €10m in 2019. It works with Italian superstar Gazzelle and distributes Andrea Boccelli, as well as distributing Sugar and Carosello – the largest independent labels in Italy.

MBW recently sat down with Ferrante – Founder and CEO of Artist First – to get his unique and informed take on the Italian market today, and where it’s going in the future…

Is it possible to make decent money from streams and physical sales in Italy and what is the physical market like these days? Is it healthy? Can you give any statisitics?

You can make decent money in Italy out of streaming even though physical product still maintains some strongholds.

For example, if an act is linked to the biggest talent show nationally, Maria De Filippi’s ‘Amici’, you can really do well out of physical sales, since that viewer demographic is still wedded to physical.

One of Artist First’s major innovations was pioneering sign-up sessions in record shops. When we started doing this back in 2009 we encountered several obstacles securing supply contracts with some well-known chains such as mediamarket and Feltrinelli.

“Many sales directors of the major companies called me to say I was mad.”

We were a brand-new company and the only way to compete with the majors and sign supply contracts with them was our proposal to get their artists into shops to take part in signing sessions with fans. Many sales directors of the major companies called me to say I was mad stating, ‘It will never work, if you take them into a CD shop they will lose their credibility.’

Ten years later and after 10,000 signing sessions more than 1 million people are still buying CDs because they met their favourite artist in a shop!

In terms of statistics – Streaming in Italy increased 8% in both 45-54 years (51%) and 55-64 years (40%) [in 2019]. In general, 57% [of music listeners in Italy] consume music only through audio streaming services: among the reasons, immediate access to an immense catalog (63%) and the possibility of selecting your favorite music (53%).

Is Italy primarily a market for domestic artists or is it a country when international acts can gain real success too?

Italians are Italians so they always like to take you by surprise. They are unpredictable.

Sometimes something that is not happening on an international scale can be very successful here. For example, the amazing rebirth of vinyl started here, completely out of the blue!

“The Italian trap scene, for example, is growing fast and has enjoyed some international success.”

The lion’s share of sales though still comes from homegrown artists. The trap scene, for example, is growing fast and has enjoyed some international success. One of the most original trap records of the last two years was this talented young rapper Young Signorino, who was endorsed by Dua Lipa.

There is also a new wave of very interesting singer/songwriters coming from independent companies like Gazzelle, Fulminacci and Calcutta.

What are the main changes that have taken place in the Italian music marketplace in recent years? Is piracy still an issue?

Live music has exploded in Italy in recent years with ticketed events becoming central to any strategic marketing plan. Yet recorded music still remains the driving force: without launching an album, promoting a tour doesn’t make much sense… the launch strategy of any campaign therefore still remains focused on recorded music even though it is delivering marginal revenues compared to live income.

Piracy is no longer as much of an issue since with subscription streaming services there is no need to download music. We are hoping to see a real increase in streaming subscribers in 2020.

Why should an international artist work with Artist First? What are the key benefits ?

I am surrounded by a great bunch of colleagues and collaborators who love hits.

When we, for example, took on Alice Merton for Italy everyone in the business thought we were crazy but my team put together an amazing campaign and we hit double platinum status with the single No Roots. Now Alice can sell out 2000 seater arenas throughout Italy.

Last year we enjoyed success with fil bo riva who is this fantastic artist we signed from a little independent label in Germany. Artist First worked every aspect including radio, playlist placement and sync.

Keep in mind as well that Milan is the fashion capital of the world. Fashion events over here are really important, and we try to get the best profile we can for the artists we represent.

At the end of the day it is always about quality for us not just numbers – although good sales are still, of course, extremely important for the health of our company.

We have also started to offer our labels and partners a very good international sales, licensing and exploitation service. We just signed Dardust, who comes from the Metatron Label we have distributed since 2014, to Sony Masterworks in the US. He’s a sort of Jean Michel Jarre for the 21st century.

At the moment I am really excited about an artist we are working with, who we are representing on behalf of one of our distributed labels Carosello. She is called Birthh and has been described as a cross between Biork and a ‘hip-hop Joni Mitchell’.

How sophisticated is the Italian market digitally ? is it keeping pace with the US and UK in terms of innovation and understanding data or would you say it is still catching up?

I have to say that we are a bit behind the US and UK and using data properly in Italy is still not at the top of the agenda for the majority of independent entrepreneurs.

For us though data is crucial because we use it to understand which decisons to take, how we invest and how we can get more from our digital marketing.

We have now have data specialists working at our company and have developed our own proprietary platform, A1 Producer, to facilitate and educate our customers about how best to use and interpret their data.

What are the dominant genres of music in Italy? Rock? Pop? EDM? Are there healthy niches that UK and US managers/labels should be aware of?

The local pop repertoire continues to dominate the Italian market (60.6%), followed by rock (53.9%), singer/songwriters (48.9%) and soundtracks (31.9%). The trend for hip-hop / rap in 16 to 24 year olds (53.2%), which this year includes a growing interest for Latin, (37.6%), continues to rise.

It’s worth remembering that two of the most important international acts today are Italian: Andrea Bocelli and Ludovico Einaudi. And if you take a look back [across] the 20th Century, two of the most important figures in international pop music were Italians: Ennio Morricone and Giorgio Moroder.

It goes without saying that dance Music is still hugely important with Italy continuing to lead trends in that field.

Would you say Italy is a growing market ? Can you see it becoming a more important territory for international acts in the coming years and, if so, why?

Italy has huge potential.

Streaming started here a few years later than in other countries but a lot of our investment is now going in that direction.

As mentioned we’ve always been trendsetters particularly if you think of many international artists who, thanks to Italian success, become priorities in other countries.

Can you give us a brief overview of how you would approach a campaign for an international act ? Are there things you have to do marketing or PR-wise? Is radio still important? Is it all about TV, streaming, touring?

We always try to collaborate when we can with trusted partners when taking on international artists.

A good example of this would be Maya Music, who often come to us with ideas of which international projects we should work on together.

Radio is still very important. In Italy the concept of ‘radio-vision’ is really established, tuning in to the TV to watch DJs talking and playing music videos, just like MTV.

“In Italy as in other countries, Spotify is very important, but also Amazon Prime Music and Apple Music are growing very well.”

Our relationships with digital platforms are excellent, we try to build those relationship based on the quality of individual projects. In Italy as in other countries, Spotify is very important, but also Amazon Prime Music and Apple Music are growing very well.

Large-scale retailers such as hypermarkets are starting to abandon physical product altogether, though it is still important in chains such as Feltrinelli, Mondadori and Unieuro.

Sadly though, most of the small independent shops have now closed.

We want to offer a 360-degree service to artists and with the live market becoming so crucial we recently acquired a management and booking agency, 432, which deals, with, amongst others, Irama and Francesco Gabbani, in addition to LeVibrazioni, a band that is appearing at the prestigious Sanremo Festival this year.Music Business Worldwide


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