My favourite story of audience insight is an old Simon Cowell one. Researching the end-of-series CD for Popstars, he toured Britain’s karaoke venues. Not the big flashy ones, but the spit-and-sawdust pubs and working men’s clubs. He listened to the last song they played each night, the song that a local would be confident of getting everyone singing along to, and hence secured the next weekend’s booking.
He made an album of those end-of-night songs.
Piracy is usually blamed for ‘free’ content, but a bit of digging often reveals unbalanced pricing, uneven demand, and a lack of available alternatives. Yet consumer spending has not changed significantly, so someone is getting paid.
With the ripples of X Factor still widening, it’s worth remembering that Simon Cowell is a music man, not a TV man. He’s out to reinvent the music business (or at least, his corner of it) and merely brings music discovery to a platform that his target audience is most comfortable with – prime time reality TV.
Cowell has effectively de-risked the music business. His production company is paid by the broadcaster to put on an event where audiences pay (via advertising) to hear his artists, and then pay (with their mobiles) to tell him which ones they like the best, and then pay again (at the shops) to buy the single.
The film industry’s version of de-risking is seen in projects like ‘Age of Stupid’ and ‘Paranormal Activity’ . Up-front distribution costs are reduced by turning audience passion into requesting that the film is exhibited nearby. If enough people press the ‘Demand it!’ link, it is screened in their local cinema.
De-risking strategies save on paying for celluloid without audiences, or singers without fans, but it can go much further into product development. The question might not be “How do I de-risk my next product launch?” but “What would I make if I knew I could not fail?”