Risk and trust

The centre of risk consciousness lies not in the present but in the future. In the risk society, the past loses the power to determine the present. Its place is taken by the future, thus, something non-existent, invented, Active as the “cause” of current experience and action.

(Beck, 1992, p. 34)

While financial transactions are obviously fundamental to the entrepreneur and can be clearly defined, the more intangible transactions are also crucial, including reputation building, trust, bartering, sharing and networking. The value of these intangible transactions, while recognised by all interviewees as being significant, was difficult to ascertain. An attempt was made to identify a single event where opportunities could be monetised or traced back to an intangible value input. Interview responses demonstrate the ambiguous and at times vague connection between intangible and tangible outcomes:

It’s hard to put your finger on it. I mean, obviously, there can be business outcomes, immediate or not immediate, and networking outcomes. Sometimes you don’t know when that’s going to come back into play.

(Interview 7, 2018)

Working in a highly fluid environment means risk management is achieved through personalised contacts, the use of word-of-mouth, engaging with professional networks and relying on professional knowledge and expertise. The number of times a manager returns to various locations or events (national ox- international) is one example of this: “I spend far more time overseas now. It’s so critical, I think, to be seen as someone who’s local. So, at the moment, I'm six weeks on and six weeks off” (Interview 8, 2018).

Trust and time enable value creation. The role of time is crucial in developing non-financial exchanges and relationships. Our Exports Strategy Survey showed that it can take up to four years to plan an event or activity. In the “trust economy”, trust is important in maintaining customer loyalty, be it for reliability, reputation, quality or sendee (PricewaterhouseCoopers, 2018). This may be based on building an emerging reputation over time, being in the same place or knowing that someone is of potential value sometime in the future.

All interviewees acknowledge the amount of time it takes to see a return on activities: “Well it’s all about contact ... Some take 20 years, some take two months” (Interview 9, 2017). The focus on the individual, and trusting how to navigate relationships, can be seen in the following quote where the manager develops an informal relationship with a potential partner. There is no specific plan, but trust in the quality of the relationship, which in turn led to outcomes:

The first time I went over to the US I met a guy ... who works at a record label from Seattle ... We met up for the first time and were just catching up, as you do, meeting for the first time, but we established a relationship in that he had flagged that he was interested in the music scene within Melbourne specifically ... he flagged an interest in what was going on in Australia as a result of a few artists that had begun to do quite well overseas, and then we kept in touch ... Following that I ended up sending him some demos for a band ... who last week released their first album ... and we’ve released two EPs with them. That relationship has really broken that band overseas. They played to 1500 people in London a couple of weeks ago, before an album has even come out. So I think that would be one example of how it’s been financially beneficial for us and for the band.

(Interview 3, 2018)

Repurposing aptly sums up the necessary skills for a manager in relation to their export activities. A “remix and recontextualisation” approach means they create and maintain value by continually having to seek new opportunities, value add their product with existing value chains and, through trust and reputation, enter into transactions as a co-creator or partner. However, their continual incursions into overseas territories demand a heightened sense of entrepreneurialism, an intuitive acuity for market demand and trusting their judgement as to whether an artist is worth taking a risk or not.

Export activities

A common question when exporting: Is it necessary to first construct a local audience? When 66 artists/artist managers were asked about their national and international activities, 63% of participants engaged in national activities, and 37% engaged in international activities. For a majority of participants, domestic activity provided solid grounding for the development of an international market. However, maintaining a continual presence overseas can exert considerable pressures upon relationships and finances (discussed later in this chapter).

The definition of an export activity is broad. It can range from those that have specific tangible outcomes such as a deal for distribution or streaming to intangible activities that lay the foundations for a potential financial return such as a media appearance, meetings or networking. The export activities listed in Figure 3.1 have been taken from the Sounds Australia surveys given to participants who attended an international industry event (see Chapter 1, Methodology). Figure 3.1 provides a breakdown of all these activities and their percentage level of emphasis.

Question 16 from the Exports Strategy Survey—Q16

Figure 3.1 Question 16 from the Exports Strategy Survey—Q16: Since 2009 which of the following export strategies have you engaged in?

Being able to export does not always necessarily require a homegrown audience. Yet for Emerging and Breakthrough artists, the relationship between radio and TV airplay, online streaming, achievement recognition such as national awards, access to international industry events and a management/PR team can lay strong foundations for success. While ultimately achieving financial gain is the goal, there are many reasons for expoxting. English-speaking countries are the natural choice fox- many managers due to the cultural or language similarities. The top five activities in Figure 3.1 are international streaming (86.96%), international physical or digital sale and distribution of recorded music (82.61%), attending an international showcase event (82.61%), attending an international festival (79.71%), conducting business meetings (73.91%) and engaging with an international publicist (63.77%).

Each territory, city or region can be uniquely defined. Digital axialytics play an essential role in helping maxxagers determine where artists' fan bases are located: “you see something on your streaming platforms that is indicating that, you know, France is actually, really playing a lot of your music” (Interview 1,2018). Because of streaming’s reliance on access-based music sendees, the relationship between artists, managers, labels (major and indie) axxd audiences is in flux. “Datafication” (see Chapter 1) is making managers rethink their relationship with labels axid international fan development:

The rules have just completely changed ... there's no rules in how you release music. Except if the music is really good and you’ve got a fan base that is really engaged with you, then you can use that platform streaming to help ... amplify that. And that’s been one of the most exciting things happening in the last few years. And it’s changed to the point that you don’t even need a record label anymore. Record labels are, certainly for developing artists, almost redundant to a certain level ... They need you, they need the artists and so that’s an exciting turn of events in my opinion.

(Interview 1, 2018)

This is further exemplified by Wikstrom (2013) who argues that incorporating an audience’s creativity into a business plan enables strong communication with the artist and peer-to-peer relationships. He describes how the next phase of the music industry will be based on context or doing things with music as exemplified by the UK artist Imogen Heap: “Imogen Heap’s Twittering, YouTubing, blogging and what-have-you are more than promotion for upcoming albums and concerts - these activities are all part of an iimnersive multi-platform Imogen Heap experience” (ibid., p. 251). In similar ways to the interactive gaming industry, such an approach raises ethical issues for managers and labels, and questions the role of authenticity as the focus shifts from a fixed recording to an experience in which the audience engages on a co-creative level. Examples of this can be observed in the early 2000s when artists started to release stems for fans to remix as part of a shared economy business model in which fans have a creative engagement with the artists. Mobile apps or album apps that allow the listener to interact or change the musical form have been gaining in popularity since the late 2000s. The Album app developed by Paterson, 2016, was developed as a format which offered ways to remix the songs and engage in the artwork of the EP. The project investigated “the app as a potential album-release format of the future in an initiative to lure the consumer away from the ‘single track download’ mentality” (Paterson et al., 2016). Platforms like Patreon also offer ways for artists to engage with their fans and income streams.

Critical are the ancillary digital activities required to get one’s product global. Fan development via co-creative experiences, or peer-to-peer relationships, must be added to the music exporter's digital tool kit as a crucial addition needed for a return on investment. In the next section we discuss attendance at international festivals and showcasing, also considered important for the development of an export outcome.

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