The conversation around superfan experiences is becoming increasingly prevalent within the music industry, and for good reason.
UMG’s Sir Lucian Grainge recently shed light on the major’s strategy, which is focusing on “growing the pie for all artists by strengthening the artist-fan relationship through superfan experiences and products.”
This strategic pivot coincides with the success of Web3 and superfan platforms like Tune.Fm, which just secured $20M in funding. The platform allows artists to monetise their superfans directly via streaming royalty micropayments and digital music collectibles.
Finally, London-based start-up TRAX said it has raised 314,000 approximately USD $2.9 million last month. With funding of about $4 million, TRAX differentiates itself by acting as a content aggregator and social marketplace, catering specifically to music artists and their superfans.
But what are superfans? Britanny Hodak, one of the authorities on this subject defines this group of consumers as “a customer or stakeholder who is so delighted by their experience with a brand, product or service that they become an enthusiastic advocate.” Hodak’s mantra is: If your customers aren’t telling their friends about you, you’re in trouble.
The importance of superfans can't be overstated.
Goldman Sachs’s latest ‘Music in the Air’ report points to superfan experiences as a crucial growth sector for the industry. Superfans represent a $4.2 billion addressable market and spend 80% more on music per month compared to casual listeners. In the report, the bank stated that it expects the monetisation of superfans to add $2 billion of incremental revenue for streaming platforms by 2027 and $4 billion by 2030.
It seems likely that 2024 will witness more companies doubling down on investment in superfan experiences.