“Pay What You Want” Pricing Strategy not just for bands like Radiohead
In the fifth session on October 5th about information goods , Dr. Ting Li briefly discussed the release of Radiohead’s seventh studio album In Rainbows in October 2007 as an example of a “pay what you want” pricing strategy. The record was released as a digital download only available via the band’s website, without any music labels or distribution partners to cut into the band’s profit (Tyrangiel, 2007). In a short class discussion we concluded that one of the reasons that this release was a commercial success for the band was because of the fact that Radiohead has an enormous audience that are more than willing to pay for a new album of their favourite band. Further, we came to the conclusion that this pricing strategy probably will not work when adopted by newer, smaller bands, because they don’t have an audience like Radiohead does.
However, in 2007, an online music store and music platform called Bandcamp was launched. On this website, artists are provided with a customizable webpage where they can upload and share their new music. The site allows artists to offer free music downloads with the option to donate to the artist, which basically is the main principle of a pay what you want pricing strategy. Since December 2014, even music labels can launch their own Bandcamp pages.
Over the past few years that Bandcamp has been active, it grew more and more to a platform to discover new, interesting artists. Using a fan account, you can also share your taste of music available on Bandcamp Discover. Users can subscribe and download the Bandcamp app, which gives instant, unlimited streaming access to all your purchases on the website.
This platform is used by thousands of different artists from all over the world and fans have paid artists a total of $125 million using Bandcamp, including $3.6 million is the last 30 days.
Tyrangiel, J. (2007) “Radiohead says: Pay whay you want”, Time Magazine
Matthew van Cooten – 359947