MUSIC:NUVO BUSINESS PLAN

Please Note - This business plan is a work in progress and some select information has been removed due to it's confidential nature. However, it is extremely important to us that our artists are involved with the growth of our company. You're invited to read through the plan and offer your comments to us at artistrelations {at} musicnuvo.com. We would love to hear your thoughts, ideas, and insight!

 


SUMMARY
BUSINESS CONCEPT
MUSIC:NUVO is a service organization providing digital retail and marketing solutions within the global independent music community. MUSIC:NUVO exists in order to allow independent artists to operate creatively n the e-commerce / marketing realm, providing back-end commerce and marketing seeks to fulfill a need a gap in the online independent music mark

The company operates via the website www.musicnuvo.com offering various levels of service.  The core, and most basic, service of the business revolves around the unique digital store solution [NUVO Artist Stores] allowing client artists to sell all of their audio, video, and merch products from one central, custom online store. MUSIC:NUVO also focuses on two additional business drivers including NUVO Cards (a physical/digital integration tool) and NUVO Web (an ala carte web design/consultancy service).

CURRENT SITUATION
MUSIC:NUVO has been in operation since January 2007 and was launched publicly as a working online store in April 2007.  During the first year of operation MUSIC:NUVO has positioned itself exclusively towards independent artists as a provider offering several key online retail solutions that are currently non-existent, or superior, to existing models.  These retail solutions have been offered as a monthly or annual subscription service, however, acceptance has been slow among the artist community.  Independent artists, often lacking liquid cash funds, are hesitant to pay monthly fees, and communication of the service's capabilities have not been entirely effective.


Significant work needs to be done to overhaul the business, increase marketing and awareness, and attain new clients.  To achieve profitability over the next year, MUSIC:NUVO will place emphasis on three key areas:

  1. Restructuring the current service plan by eliminating monthly subscription fees and clarifying the unique product offerings

  2. Renewing marketing efforts towards the independent artist community through direct communication, participation in industry conferences, and investing in e-marketing campaigns

  3. Creation of strategic partnerships with key independent artist communities and resources


KEY SUCCESS FACTORS:
Growth and long-term success will be result of:

  1. Acquisition of a substantial number of new artist clients

  2. Steady cash flow through artist sales royalties and ad revenue

  3. Maintaining a superior service that stays ahead of the curve to resource the independent music artist with key online retail and marketing strategies

VISION
VISION STATEMENT
MUSIC:NUVO strives to be the preferred e-commerce and marketing solution for independent artists by offering musicians superior tools to sell, market, and promote their content online. MUSIC:NUVO remains committed to offering custom and flexible services in order to foster creativity support the unique and fluid needs of the independent artist community.


MILESTONES

  1. 12/31/07 - Website revamp completed demonstrating revised product offerings

  2. 1/10/08 - Renewed email marketing push towards existing NACA artist contacts and CD Baby clients begins

  3. 2/1/08 - Purchase e-marketing campaign

  4. 3/1/08 - Achieve goal of 15 artist clients with custom NUVO Artist Stores

  5. 6/15/08 – Attend 2-3 independent music conference, Summer ’08, and interact with artists face-to-face

  6. 12/31/08 – achieve goal of 100 artist clients with custom NUVO Artist Stores


MARKET ANALYSIS
THE OVERALL MARKET
The digital music environment is a young and developing, albeit incredibly competitive market.  Since the advent of the internet, musicians have had websites and have sold their physical recordings (cassettes and CDs) online.  However, the birth of the digital music era, beginning with Napster and more recently the success of iTunes, has lead to a revolution in terms of how music is shared, purchased, and experienced.  Many different business models exist each of which are attempting to create, and cash in on, profit-making opportunities in this new market.  Many of these businesses focus on the major record labels hoping to capture a small piece of the profit pie generated by A and A+ recording artists.  Other niche services focus on specific subgenres or segments of the larger music market.  When all is said and done, each service attempts to excel at a particular model of delivering content from the recording artist (manufacturer) to the fan (the end customer), and along the way charges a set fee or percentage for providing the vehicle of delivery.

CHANGES IN THE MARKET
The digital music market is extremely fast paced, with new technologies emerging daily that continue to shape how music and other music related content is consumed.  To a certain extent the technological pace is much faster than the consumer base can absorb, and new startup companies regularly rise and fall before their models can be fully dissipated to the public.  Society is in many ways still very cautious about e-commerce, and transactions generally occur via the most established / recognized websites or those sites who have built a solid level of trust with their costumer base.  Morphing technology will continue to propel the changes in this industry, and the consuming public will largely direct how new technologies are developed based on the most prevalent (or needed) buying traits.

MARKET SEGMENTS
Music is truly a worldwide market with thousands and thousands of market segments based on region, style, and sociodemographic contributors.  The simplest breakdown of market segments begins with regions, with strong markets existing in the United States, Europe, Southeast Asia, and Australia.  From the regional markets, further segmentation exists based on genre, including Rock, Pop, Urban, Jazz, Classical, Country, etc.  Also of note, segmentation also exists based on levels of perceived "success" and influence, including the major label realm of recording artists, the many ranks of independent labels and artists, all the way down to locally based "garage" bands.

TARGET AUDIENCE AND MARKET / CUSTOMERS
For additional purposes of definition, a "client" of MUSIC:NUVO is understood to be a recording artist or record label, involved in the business of creating and selling musical entertainment to their end customer.

A "customer" of MUSIC:NUVO is also the customer of MUSIC:NUVO's clients - the "customers" are the public who buy the music and products of MUSIC:NUVO "clients".

From the very beginning MUSIC:NUVO has set itself up to serve the independent music market.  This subgroup can be far-reaching in definition, crossing many genres and regions.  For purposes of defining a core market, MUSIC:NUVO considers it's primary client base to be independent artists and record labels of moderate success, who are primarily based in the United States.  "Moderate success" is a loose term, but could generally be understood as any artist or label who earns 60% or more of it's annual income from the music they create, and are positioning themselves for a long-term career in the field of music.  MUSIC:NUVO is not focused on providing services to major labels, or artists distributed via major label networks - primarily those under Sony/BMG, Warner Music Group, Universal Music, and EMI Music. While the primary region of operation will be the United States, MUSIC:NUVO is capable of extending it’s services to clients in any foreign territory, and customers in virtually any corner of the world will be able to purchase products through MUSIC:NUVO’s store.

CUSTOMER CHARACTERISTICS
Customer characteristics will vary along with our clients, based on regional and social music likes and dislikes.  In general, MUSIC:NUVO's customers will be fans of independent music - those who seek entertainment outside of the normal realms of Top 40 radio and other mainstream entertainment avenues.

CUSTOMER NEEDS
MUSIC:NUVO's customers will have an emotional attachment to clients of MUSIC:NUVO - through experiential circumstances, like an artist's concert, they will become fans of the artist and will ultimately want to purchase the artist's music for their own.  It's safe to say that the emotional attachment between an independent artist's customers is even stronger and more deliberate than the customers of mainstream major recording artists.  In many regards it will be assumed that the customer already has intentions to purchase a client's music by the time they arrive at MUSIC:NUVO.  Ultimately it will be MUSIC:NUVO responsibility to provide a trusted, reliable, and intuitive online interface for customers to purchase our client's music and content, and in doing so we will provide for our customer's most basic needs.

CUSTOMER BUYING DECISIONS
Buying decisions will be based on many factors, most of which will be external, beginning with the artist's relationship with their fans and the degree of acceptance of their music and art.  Customers will have a variety of opportunities to purchase a client's music, including their concerts and directly via the artist's website.  Of direct concern to MUSIC:NUVO, customers buying decisions will be influenced by their online experience - if the experience is enjoyable, informative, interactive, and user-friendly this will positively affect the buying decision.


COMPETITIVE ANALYSIS
INDUSTRY OVERVIEW
As cited above the digital music industry is dynamic and extremely competitive with new digital music retailers opening (and closing) their doors every day.  The digital download business is dominated by a few key retailers, including but not limited to Apple iTunes, eMusic, Napster, Rhapsody, and Microsoft Zune.  Likewise the online physical music retail business is dominated by major players including Amazon.com, WalMart.com, and in the independent music scene, CD Baby.  Also of note, solutions do exist enabling independent artists to sell their physical CDs directly from their own websites - most notably PayPal, a relatively low-tech but extremely prevalent service provider for direct credit card transactions.

NATURE OF COMPETITION
In analyzing the nature of the competition, it is helpful to call out a few key competitors that offer services that are similar (though not identical) to the model offered by MUSIC:NUVO:

Apple iTunes


CD Baby


Snocap


Disc Revolt

Aimee Street



INDUSTRY CHANGES



PRIMARY CUSTOMERS AND PRODUCTS

OPPORTUNITIES


THREATS


STRATEGY
KEY COMPETITIVE STRENGTHS


COMPETITIVE WEAKNESSES


STRATEGY

IMPLEMENTING STRATEGY

PRODUCTS / SERVICES
DESCRIPTION



POSITIONING

COMPETITIVE EVALUATION

FUTURE PRODUCTS



FUTURE PRODUCTS SCHEDULE

SALES & MARKETING
MARKETING STRATEGY

SALES TACTICS

ADVERTISING

PROMOTIONS

PUBLICITY

TRADE SHOWS

OPERATIONS
KEY PERSONNEL

ORGANIZATIONAL STRUCTURE

HR PLAN

PRODUCT / SERVICE DELIVERY

CUSTOMER SERVICE

FACILITIES