Learning how to monetize music isn’t nearly as exciting as writing songs, spending time in the studio, or hearing that first mix. Music monetization isn’t even the most essential part of what you do — but it will help you generate revenue to fuel your passion.
Just like music genres, the methods of making money with music have evolved over time. Before there was online distribution, artists sold CDs. Before that, cassettes and records and so on.
Monetization is necessary for being a successful musician. You just have to know where to start.
What is music monetization?
Music monetization is simply a way for musicians to make money in a digital format. Monetization happens in many different industries, and you probably know the term as it relates to social media or video revenue.
In the music industry, monetization can get a little complicated. For an artist to make money on a song, they have to own the royalties. Royalties are the amount paid to whoever owns the song whenever it is sold or monetized.
For example, if a movie wants to use your song for an outro, they would have to pay royalties for the music rights.
Royalties are also categorized into two separate copyrights.
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FAQ: How does music monetization relate to streaming?
Streaming platforms generate income through subscriptions and advertising, which is then used to pay royalties to the various rights holders of the music being played. Therefore, music monetization is directly tied to streaming as royalties from streams represent a significant portion of earnings for artists, songwriters, labels, and publishers. While streaming growth is great to the overall industry’s health, most artists don’t make money from streaming!
How could that possibly be the case? Let’s break it down.
Advertisements and subscriptions support most music streaming services. When you listen to music using a streaming service like Pandora or Spotify, advertisers pay the streaming service to supplement your listening experience with ads. If you opt to pay a monthly fee, that money goes directly to the service.
The money artists do make from streaming services comes from royalties. According to one Spotify company filing, the average per-stream payout is between $0.006 and $0.0084. So while streaming is a powerful tool for its potential to get your song into millions of ears, it’s not exactly the most profitable.
What are the benefits of monetizing your music online?
There are many benefits to monetizing your music online. Whether you’re at the beginning of your career or already touring the world, it’s always a good idea to have a digital revenue stream to supplement your goals.
Putting your music in a digital format allows more people to access it. More listeners, more downloads, means more money in your pocket.
With any physical distribution, there is a limit to the people you can reach with any physical distribution — or how many CD copies you can burn at a time.
Nowadays, the other option of physical music sales (selling seats in a venue) has limited opportunities. By monetizing your music online, you can grow your sales and reach simultaneously.
While concerts and in-person performances have always been great for connecting with fans, keeping your music in a digital format allows you to do that as well. Since your music is available online, you can quickly market it and continue to do so even when performance venues open up again.
There are plenty of ways to monetize music streaming in a way that works for you and your band. Before you know it, you’ll be growing from offering songs to live-streamed performances in no time.
There are a few different methods you can use to monetize music streaming. We’ll go over the most common revenue streams musicians use to monetize their music:
3 Key ways to monetize your music
1. Use a distribution platform
Indeed, artists don’t make much money streaming, but it’s an important channel to be on for exposure and accessibility.
A distribution platform distributes and collects royalties from streaming services. Many of these platforms can send your music to major streaming platforms, including Spotify, Apple Music, Google Play, and more. Some even distribute to more niche-platforms that cater to genre-specific listeners.
A bonus to many of these platforms is that they offer opportunities for advertising or profile management. Meaning, once you get your music distributed, these platforms help you grow your audience.
Artists can access some of these platforms for free, but most come with fees. When choosing a platform, you’ll have to consider your priorities. If you’re already mastering and working on a social media marketing strategy yourself, you might favor a platform that focuses solely on distribution. And if you’re looking to source a producer, perhaps investing more into a distribution platform would help you finish what you’re creating.
Here are some of the most popular distribution platforms:
Amuse
Amuse is a free, mobile distribution network that allows the songwriter to keep all of their copyright. Their pro version even allows for social media distribution — including Instagram and TikTok. It’s an excellent choice for independent artists and artists looking to be discovered.
Spotify for Artists
Spotify for Artists distributes solely on Spotify. Because Spotify has 345+ million listeners in over 90 markets, this is a huge draw for some artists. By distributing through Spotify, you’ll be given the keys to customizing your own Spotify experience with ads, profile tools, and Canvas — a short looping visual you can add to each of your tracks on the app. This option is also free and provides analytics that musicians and marketers alike will find invaluable.
Landr
Landr distributes to every music streaming platform for fees starting at $6 per month or $48 per year. It highlights “artist-friendly” distribution and promotional tools, as well as free educational content to grow your sound.
TuneCore
TuneCore offers access to over 150 digital stores and streaming services across 100+ countries worldwide. It provides comprehensive sales data to understand who your listeners are and where they come from, in case you plan on touring anytime soon. Distribution prices vary depending on the content you’re releasing and continues per year. For example, if you’re releasing a single, that’ll cost you $9.99 a year. TuneCore also comes with mastering benefits.
2. Sell digital downloads on a community platform
Digital downloads offer artists the opportunity to profit directly from their music sales, not just royalties. When a user downloads your song from a community platform or website, the money goes right to your pocket and directly to the consumer.
Many artists get their start on these free, community platforms before branching out to the major streaming networks. A community platform offers just what it promises — a community. By bringing your music to these sites, you’re accessing a new pool of fans who are there to discover new music.
Bandcamp
Bandcamp allows artists to create their online store to promote and sell their music. Using Bandcamp, fans can listen to your music, fall in love with it, and pay you directly. You can charge any price for a song or album and reach a whole new community. Bandcamp has a host of fan features for discovery, including a music feed and artist recommendations.
SoundCloud
SoundCloud markets itself as the option to connect with fellow creators and unlock future fans. With SoundCloud, you can collaborate with other musicians and get real-time feedback. You can also make your songs available for digital download.
Sell digital downloads on your site
If you don’t already have a music website, now’s the time to start. Offering digital downloads on your own website is a no-brainer. It’s the most direct way to collect money for your songs, and it’s a great marketing tool. If you’re looking to play new venues or score a gig, directing managers to your website is the perfect source of truth. It shows that you mean business and provides a concrete example of who you are and what your sound is.
3. Tap into a music licensing service
Music licensing grants permissions for organizations or individuals to use your music for a fee. You can sell the license of a song and generate profit. The biggest music licenses typically come from movie productions, content creators, advertisers, and brands.
There are a lot of intricacies to licensing your music. For example, some companies require that an artist works with them exclusively. So if you’re licensing a song to a company to use for a commercial, you probably won’t be able to license another to a movie production.
This is why using a music licensing service can be beneficial. It does the work for you while you make the profit.
However, there are a lot of music licensing services out there that serve different markets. Small creators and businesses are more likely to use a music licensing service that has a large content library with small fees, and the standards of songs these services accept might be lower than the masterpieces you’re producing. Or, maybe you’re dedicated to serving this market and decide to produce many singles that cater to vloggers and social media video creators.
Either way, it’s important to do your research before allowing a song to be licensed out. Here are a few of the top services:
Epidemic Sound
Epidemic Sound acquires exclusive rights to your music and pays you up front. So once you’ve made it on their catalog, your songs can’t go anywhere else. Epidemic Sound mostly caters to YouTube creators through subscription payment structures and hosts over 32,000 tracks. A nice benefit to submitting to this service is they distribute to streaming platforms and pitch music to playlists.
LuckStock
LuckStock is a European-based option with the mission of creating a high-quality royalty-free music marketplace. A minimum of 50% of your song’s revenue goes directly back to you, and you can retain the license to your music. Meaning, you can offer your songs elsewhere without any restrictions.
Music Vine
Music Vine hosts a small catalog of songs that are carefully selected from independent artists and bands. They serve independent filmmakers and highlight a mix of cinematic production tracks. If you offer an exclusive license, you make 60% of the profit.
Other ways to monetize as a musician
Making a living off of any passion takes a considerable effort, and music is no exception. Music may be the most crucial part of what you do, but there are other ways to monetize your skills.
The average working musician earns about $35,000 annually. There are many opportunities to extend your skillset to make more, or even just to spend your time doing something you love. Plus, it’s always a good idea to develop multiple streams of revenue within the creative sphere.
Here are some practical ways you can make money as a musician outside of selling your music:
Sell band merchandise online
You’ve already created a website to market your music and sell on your terms; why not sell other things too? After all, everyone loves a good band tee.
Offering band merch allows your fans a simple, affordable way to support you. If you have a social following, ask your fans what they’d like to see and customize your offerings to them. This way, you know you’re providing exactly what they want, and you’ll get your vendor investment back.
Offer music lessons
You’ve probably spent years mastering your instrument, and there are thousands (maybe millions) of people out there trying to learn. And now that most classes have gone digital, your potential market is a lot bigger than before the pandemic.
The number of students taking at least one online course has grown by 151 percent, and many learners are becoming comfortable with the virtual class format.
Prices for private music lessons vary, so do some research on what you could ask for given your specific instrument and expertise level.
Make money as a musician with live streaming
Here’s the thing, everyone misses live performances. And even if you’re just going live on Instagram, free live performances are a fantastic marketing tool.
If you’re looking to go live regularly, maybe pull together some local artists for a virtual concert or workshop — utilizing a live-streaming platform would allow you to reach an audience from multiple locations. Anyone can learn to live stream well; just take a look.
How can I create a virtual concert?
Use video
Streaming video on demand is an ever-growing market that will continue to outpace other mediums for consuming content.
Video monetization is an excellent option for artists looking for passive income. If you already have a growing fan base, offering gated content is sure to bring in revenue.
The best part of creating stream-able video content is that your audience can come back to watch anywhere at any time. As you grow your fanbase, these videos will become an exponentially valuable resource.
What is the best platform to distribute music videos?
Determining the "best" platform to distribute music videos depends on an artist's goals, but platforms like YouTube are prized for their global reach.
For artists prioritizing high quality, embedding capabilities, and more customization features, Vimeo offers excellent video playback and advanced SEO options. Many artists also utilize distribution services to get their music videos onto platforms like Apple Music and Tidal for fans to access and for potential monetization.
Wrap up: how to make money with music monetization
The great thing about music monetization is that you can experiment with different tactics to discover what works best for you and your lifestyle. These methods are constantly evolving, and the trick is to always pay attention to your audience.
Monetize Your Music Today.
Vimeo offers creators tools for content hosting, a text-based video editor, timeline editing features, visual graphic tools capabilities, and an image-to-video converter.
