How to Understand Independent Distribution Niche Marketing

How to Understand Independent Distribution Niche Marketing
Like most traditional forms of music distribution, independent companies make records available to retail, from HMV and Future Shop to "mom & pop" record stores. Like major labels, these indie distributors send out sales sheets listing new releases and then have sales reps follow up. Unlike large distribution companies who peddle major releases for mass consumption, indies tend to work with modestly sized labels and artists to promote music that has a more niche (read: smaller) appeal. This lack of potential for volume sales might turn Zellers off of indie distributors but not entirely. "We do sell to the chains quite happily and do as good a job as we can," says Keith Parry of Vancouver-based Scratch Distribution, "but it's no huge secret that the chains' mandate is to give priority to whatever the Top 40 releases are, which excludes 99 percent of independent labels." Very small distributors may actually have little or no access to larger corporate customers, but established midsize distribution companies like Sonic Unyon, F>A>B, Outside, Fusion III and Scratch feature such a variety of labels and artists that both chains and independent shops will find items that have a degree of sales certainty.

Five star distribution.
By and large, indie distributors have a much smaller overhead of costs and therefore can be less concerned with turning huge profits. Keeping an eye on the numbers, they're typically very dedicated music fans as well, working extremely hard for minimal financial gain. The competitive and trend-based music marketplace forces indies to diversify their companies in order to turn a profit. This can mean working simultaneously with vastly different genres of music and as many different labels as possible (i.e. Fusion III), or expanding operations to include a label, mail order, and a retail store (i.e. Sonic Unyon and Scratch). It's challenging, but artists and labels working with an indie distributor can expect to deal with people who are passionate and knowledgeable about music. "No offence intended, but if you want great food you don't go to the big chain restaurant," says Sonic Unyon's Mark Milne. "You want wait-staff that know about the wine and food they are serving and a chef that can give you something unique that you will tell your friends about. People with good taste work at these restaurants and likewise tastemakers tend to work at great record shops."

"Fe, fi, fo, fum, I smell the blood of… hey is that the New Pornographers?"
Major labels tend to keep one eye on the sales numbers and the other eye on the independent music scene. They know that their hot teen sensation will sell bucketfuls at Best Buy before it sells a single copy on down on hipster avenue, but they also look to what is selling at the indie level, which serves as a harbinger of the future. (Examples abound, from Broken Social Scene's early sales in Toronto, to Death Cab For Cutie's recent Atlantic signing.) Major labels and larger retailers keep a keen eye on tastemaking labels and stores, but even the coolest underground trainspotters can only do so much. "For us, with a big release like the A.C. Newman or Destroyer or the Pink Mountaintops, to sell a few thousand copies is the realistic goal," Parry says. "If we have a release to distribute that there is demand for, it sells. It's as simple as that. There is little we can do to make an independent release popular; that really is in the domain of the label and artist themselves."

Listen up. And tell a friend.
Because of their limited financial resources for marketing and promotion, indie distributors and labels rely, more than anything, on the credibility of their products. If they can get the music into the hands of the right radio stations (college and commercial), journalists, and stores then all of these things help contribute to creating positive word of mouth. More than money, independent music thrives on communication and trust — two things that are less important to large labels and retail outlets that have marketing dollars to spend. (After all, being un-hip with jaded record clerks won't stop influential young consumers for whom the Simpsons are Jessica and Ashlee.) Serious fans of music are likely to believe their favourite DJ or music reviewer when they say something's good. The same goes for the trusted friend at the counter of a local indie record shop. Yes, such personal touches are a free form of advertising for indie distributors and labels but, less cynically, they're also aspects of the passion shared by addicts who truly believe that a great record really can change the world.

Frequently Asked Questions

What's indie distribution gonna cost me?
Unlike larger distributors who pay labels based on orders that are shipped, independent distributors pay labels based solely on hard sales, with protective variables in place in the event that retailers return a lot of unsold albums. While a major can offer a volume discount that saves retailers money when they buy more copies of a release to stock (i.e. 100 copies for $9 rather than 30 copies for $14), indies rarely distribute records that have the profile to encourage stockpiling them. Since volume discount incentives are less of an option, customers usually see relatively higher prices for these releases. Sure, you could opt for Blink-182 over the new Hot Snakes, but you really do get what you pay for.

As an indie act, it'll be easier to work with an indie distributor, right?
You might have easier access to an indie than a major, but even indie distribution won't make things easy — there's a huge glut of available product out there. It's never been easier to record and manufacture 1000 CDs and there are more bands and labels saturating the marketplace than any time in history. "Sadly most of them have no reason to exist," laments Scratch's Keith Parry. "I swear we hear from 100 new labels a month and most of them are a complete waste of time. I'm sure that sounds harsh but it's the truth." Because these bands operate on a grassroots, DIY level, their existence affects the indie marketplace the most. Major labels and distributors react slowly and work with fewer acts anyway, so over saturation of indie music really only affects other indie music.

Should I be worried if Wal-Mart won't stock my indie CD?
If you're making challenging music, it's less likely to end up in large department stores, which work on a supply-and-demand basis. Bands with roots in the independent scene, like Ani Difranco or the White Stripes are stocked at Wal-Mart because there's an increased demand for their music and their sales at the indie level justify it. Until the audience for your music grows exponentially, you shouldn't expect your records to end up in a shopping cart already loaded with sweatshop socks and crappy small appliances.