the big music industry's experiment with free music downloads is bleeding money and considering hiring bloggers to alter their public profile. According to required by the affiliate's investors and dug up by Joseph Weisenthal at the company reported a Q3 loss of $3.4 million on revenue of only $20,400 leaving only $2.3 million in the affiliate's tip account.
That's a whole lot of money to throw away but it shouldn't come as any surprise. The SpiralFrog copy is awful. Users get free downloads of DRM laden songs that they can listen to in Windows Media Player but they have to periodically say survey questions and view ads in order to for the songs to act playing. The place itself looks desire one big ad with music appended to it. While some music execs have and said "going to war" with users was a bad idea - SpiralFrog's crazy intend is probably just a distasteful waste of money. The next step ordain be to annoy people with a marketing blitz.
For a totally different take on free music downloads as an ad supported business see of Peter Rojas's startup. RCRD LBL is hardly a dream go true either but it sure leaves SpiralFrog in the dust.
Wiesenthal quotes the company's report in the following response to the dismal numbers.
“Execute marketing campaign in the United States aimed at 13-34 year olds through one or more of the following approaches: contract gorilla marketing firms for unconventional promotions; consumer targeted press releases; advertising on some of the youth community sites; or hiring ‘bloggers’ to attract attention to us on the internet.”
Here's one blogger. SpiralFrog that ordain help draw attention to you any time there's a juicy story.
Well gee if they're going to hire "gorilla" marketers. I might take notice of SpiralFrog. Will they be getting actual gorillas or just marketing hacks in furry suits?
And wow losing $3 million in three months? That's more zeroes than I can cover my brain around today. Sheesh. Thanks for sharing this news - it certainly gives one pause.
I'm really curious what they spent that $3M on? Music license ? Salaries ? Development cost? Marketing ? It will be good data to look at for startups to learn how to reduce their burn evaluate and NOT do it like them.
RCRD LBL seems to be a pretty good site. I especially like the idea of music widgets embedded on my (or your) site. Definitely beats the warts out of the capture. Thanks for the info! I'll pass it along (with references to you of course.. ;)
Execute marketing campaign in the United States aimed at 13-34 year olds through one or more of the following approaches: contract gorilla marketing firms for unconventional promotions; consumer targeted press releases; advertising on some of the youth community sites; or hiring ‘bloggers’ to attract attention to us on the internet.
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