What is the purpose of labels in the music industry and why do they hold so much power as well making more money than the artists signed?
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Used to work at an indie a long time ago, but it is basically the same in miniature.
The label will have the following major roles:
1. A&R – Artists and Reparatory
Essentially talent scouts. They find and (sometimes) develop promising bands. At the indie level that’s usually the owner of the label itself. Majors have teams doing this. Bettina Richards, owner of Thrill Jockey records in Chicago, got her start as an A&R rep for Atlantic Records, for example. This person might also set up recording studios, producers and all of that. Basically the liaison between the band and the label.
2. Marketing
These people are in contact with music magazines, radio stations, newspapers etc. They send out marketing materials to support new releases. They set up interviews for the bands, buy ads, etc. At major labels this group is usually massively larger than at an indie.
3. Sales
These folks work with record stores and other retailers, taking orders for how many copies of X they want to stock. This role has changed a huge amount in the digital era.
4. Production
This is the group that deals with the physical production of CDs, LPs etc, working with pressing plants, scheduling orders and so on. Also less prominent in the digital age
5. Distribution
Once the CDs or whatever are delivered to the label (at least that’s how it worked at the indie) this group coordinates all the shipping. They pick and ship orders to record stores, other distribution centers, etc.
6. Tour Support
A subset of marketing, specifically helping touring bands with merchandise, local media and so on. Typically there is a booking agent that sets up shows and all of that. Where I worked this was a separate company that most of the bands worked with. Majors probably do it in house
7. Art
The art department designs the ads the marketing folks are placing, creates the album artwork (sometimes), posters, t-shirts — anything visual
8. Other
The label might have a mail order person for direct sales to the public, a returns person to refurbish broken CD cases and so on, and all the internal financial stuff (accountant, payroll, etc)
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