Mad Respect

As this calendar year fades for Topspin, I look back at what our team has achieved. We have been heads down, working hard to make radical improvements in our products and throughout the company. We’ve significantly progressed, and the Topspin team deserves all the credit for being exceptionally productive and fun to work with.

Last week we released a simple metric in our Topspin Platform app that calculates the average value of an artist’s fan. This AVF metric is an early precursor to how we will eventually measure the Life-time Value (LTV) of an artist’s fan in Topspin. It’s just the beginning and will evolve into a more useful number to help artists figure out how much they can afford to spend in acquiring fans in different promotional channels. This Cost-Per-Acquisition (CPA) metric for a Fan can be weighed against how much revenue a potential fan brings to an artist.

These LTV – CPA > 0 types of calculations have existed in different industries and performed exceptionally well for many companies like Netflix.

Sometimes it’s easy to get rubbed the wrong way with terms like “advertising,” “profit,” “LTV,” when talking about art and artists. We need to be respectful that art and our human connection to it is highly personal and uniquely important beyond any monetary value we place on it. Topspin’s mission is to help artists make a living, and we tend to get excited and obsessed about introducing artists to proven marketing methods that could increase their bottom line. We will be championing the use of these standards and speaking in their terminology, but please keep in mind that it’s for a purpose: to help artists make more money.

Hannah Karp at the Wall Street Journal, wrote a story about the artist-fan data in Topspin and shared the different AVF metrics from several artists. For example, Arcade Fire’s is $6.26, Sigur Ros is $10.91, Umphrey’s McGee is $32.96, and the Pixies is $4.26. The AVF when looked at in comparison is not helpful because the metric is unique to different artists depending on the number of fans they have, their specific methods of direct marketing, and their product bundling and pricing strategy.

The AVF metric, however, can be actionable for an individual artist to keep a baseline and heartbeat of their direct-to-fan business. They can measure improvements in their baseline values and tie them back to their promotional activities. It should give a sense of what worked and what didn’t. Across Topspin over 5 years and millions of transactions, the general average AVF $3.78, so if you’re looking for a good arbitrary general average to compare to your own AVF, that’s a good a number as any. That value at least supports giving your media in return for a monetizable email would be a good exchange, since earning $3.78 on average is far higher than the price of a song download.

This AVF figure in the Topspin Platform will grow into a future LTV metric as we learn how to model fan value in a meaningful way for artists. This LTV will be eventually be measured against a CPA metric for a fan derived from Topspin’s ArtistLink product, which just released a free cross-marketing network called the Promo Exchange along with a paid advertising program.

The new ArtistLink release is a significant evolution of Topspin’s efforts in helping artists with a self-serve advertising product. It’s Peter Gotcher’s original vision of Topspin, and our recent feature releases represent Topspin going back to our roots as a data driven, artist-focused company aimed at solving the hardest problem in fan acquisition: turning the unaware into the aware at the top of the marketing funnel.

There’s so much more to come on both the Topspin Platform and ArtistLink, and I can’t wait to share all the exciting developments ahead.