Part of the Techstars Music class of 2021, Westcott Multimedia gives music rights holders access to hyper-targeted programmatic advertising in order to drive recording, publishing, ticketing, and merchandise revenue.
Here, founder and CEO Kristin Westcott Grant explains the origins of the company and the potential for turning consumer data from streaming into dollars.
What led you to create Westcott Multimedia and what problem are you solving?
Eight years ago, I drove the digital distribution and marketing of a Grammy Nominated album for an artist named Barrington Levy during my Music and Business Masters Thesis at New York University. During that process, I realized that music rights holders do not have access to the consumer data from streaming necessary to make informed marketing decisions.
Fast forward to my time managing Global Playlist Strategies for Universal Music Group, now having access to a lot of this information, I realized that the volume of data available is simply too high for an individual person to process manually to make informed marketing decisions across all songs in their catalog.
After I left Universal Music Group, I ran a series of Roster Analysis Reports, similar to a financial audit of a label’s roster. We analyzed a year’s worth of revenue, expense, and stream data. We re-organized this information originally by album to be organized by the artist.
What we discovered was that when a label was spending ad dollars, it was not aligned with when customers were streaming music online. We designed a modest model to project the impact on revenue if a label spent marketing dollars when consumers were paying attention online.
Through this research, we saw a massive impact on a label’s bottom line if marketing efforts aligned with online consumption.
“We saw a massive impact on a label’s bottom line if marketing efforts aligned with online consumption.”
As a company, in Westcott’s view, there is two distinct types of value derived from an individual stream transaction. The first is money, on average $0.0045 cents depending on what region that stream transaction is coming from.
The second is non-identifiable information about the consumer who streamed that music. The value in non-identifiable consumer data from streaming is that it can be used to drive all ancillary revenue streams related to an artist. Revenue streams that would not exist if the music did not exist in the first place like vinyl, merchandise, ticket or brand revenue.
Access to this information is still gated. Westcott sees the democratization of access to this information as a fundamental way for rights holders to take control over their music promotion and grow revenue.
How does it work? Can you talk about the role of technology and automation?
Westcott is an automated advertising platform that dynamically launches campaigns for catalog music based on real-world events such as holidays, concerts, or viral Tik-Tok video.
Westcott automatically generates ads, identifies audiences, tracks industry signals, identifies best market pricing, makes ad buys, and provides real-time reporting in order to drive ROI.
To start, a label provides Westcott with marketing dollars, considered money under management that can be spent across any single artist in the label’s roster. When Westcott spends a portion of capital they charge a 15%-20% fee. A label can turn ads ON or OFF for any artist in their roster with the toggle of a switch.
Westcott’s automatic system tracks daily stream data and other industry signals to determine when, who, how much, and how long to launch a campaign. Technology and automation is used to mitigate the music rights holders’ marketing budget to gain the best return, based on consumer behavior in the marketing in real-time (or within 72 hours of that moment of increased awareness).
During your Techstars Demo Day presentation you said, “If data was accessible and applied effectively, it could drive 3 billion dollars in recording, publishing, merchandise, and ticket revenue.” Can you explain where that figure came from?
We looked at IFPI information about how much is spent on marketing and A&R. We then applied our learnings from our work conducting Roster Analysis Reports with record labels which projected the overall impact on revenue if marketing dollars were spent when consumers were paying attention online.
Using these assumptions we projected a $3 billion dollar impact on revenue if data was applied effectively to drive timely marketing decisions.
“We projected a $3 billion dollar impact on revenue if data was applied effectively to drive timely marketing decisions.”
You offer hyper-targeted programmatic advertising – just how deep can you go in narrowing down specific audiences?
We are exploring different opportunities and expanding the depth of our Audience Identification Engine on a daily basis.
Saying that, one of the areas that we are really excited about is the application of cohort analysis and how data from the ads themselves, our partners, streaming data, and publicly available information can help to inform this type of hyper-targeted advertising.
Is there any way of knowing the context of the spike in the first place? (e.g. a sync, a TikTok video, etc.) How much does that matter?
Absolutely. Westcott has data partners like Chartmetric, and through these partnerships as well as publicly available APIs it is possible to identify when a song was placed on a playlist, when there was a spike in attention on TikTok, when a song was synced on a TV show or movie, when the artist had a birthday or the fact that it is summertime in Australia – just to name a few.
These marketing actions can be identified and connected to when there are moments of increased online awareness for an artist or song.
Can you give a real-life example of how the platform helped to create untapped revenue for catalog music?
For one of our Bluegrass bands, The Dead South, Westcott helped to drive an increase in Spotify followers from 450k to 1.1M.
In Q1 2021, Westcott launched ads for a record label’s entire catalog of music. When comparing the revenue performance of the artists that Westcott launched ads for in Q1 versus Q4 2020, all of the artists saw an increase in revenue. Overall, the label saw a 1.4% ROI for the deep catalog artists that Westcott launched advertisements for.
You’re looking to work with strategic partners – like who?
First and foremost, we are looking for record labels or investment firms who have purchased master recording rights to use and apply our product to drive streaming revenue and Spotify followers for their catalog repertoire.
“We would like to see the power and control of access to data and promotion shift towards the music rights holder.”
As new platforms appear and access to data and analytics improves, what are the possibilities for the future of Westcott Multimedia?
We would like to see the power and control of access to data and promotion shift towards the music rights holder. In doing so, we would like Westcott Multimedia to become an integral part of the independent market and emerging markets’ success in gaining market share popularizing their music globally.
To find out more about Westcott Multimedia head to www.westcottmultimedia.com