Merch Beyond The Meatspace
The creator economy that's being built with web 3.0 is going to transform the music industry. What could the utility of a band t-shirt be in the metaverse?
Once a week I hope to deliver value to your inbox as I speculate on how blockchain and immersive technologies are going to transform how we create and share stories in the future.
As always, thank you for reading ❤️
Introduction
Avatars and Digital Belonging
Digital Commodities Are Nothing New
Merchandise in the Music Industry
New Models of Utility
Conclusion
Dear subscribers,
In this week’s piece, I want to talk about music, merchandise and where they could fit into web 3.0 technology.
I don’t want this to simply be a piece on the potential returns in this transition though, because it’s about much more than that. Merchandise, and the music we associate ourselves with, is deeply embedded into our identities and our sense of belonging. It’s one of the first things we ask someone when we meet them; ‘What music do you listen to?’
So before I get into some of the numbers of the merch gig, I think it’s key to get to grips with how the transition from material to digital ownership of merchandise is, at the heart of it, about belonging and community.
Avatars and Identities
It’s human nature to want to be a part of a community. To be accepted by a group of people you admire and share values with; that allows you to say something about yourself that you want the world to hear. These silent evocations of our inner spirit are perhaps even stronger than the words we speak.
These communities come to shape us, and in this increasingly digitised modern world it’s far easier to explore a plethora of communities that are vying to embrace you as an extension of theirselves. Take, for example, the Vintage Toilets of Sussex and Kent Youtube Channel. As a self-prescribed weirdo and outsider myself, I love finding the nuanced spaces that spring up on the fringes of the internet, because that is where humanity is in its’ most organic and undisturbed state. Reddit is great for that.
Sean Bonner talks about this with real clarity in his blog:
Most of us are misfits and weirdos who didn’t fit in with the world we saw around us, so we built our own. Or since it’s so much easier these days, we found others like us and embraced the world they’d already started building. And once a part of this chosen family, which ever one that might be (or several concurrently) it becomes deeply important to us, shaping us as much as we shape it. We become the community, and the community becomes representative of us – our interests, our hopes, our dreams.
In my recent dives into NFT projects, I have become deeply embedded into some of the surrounding communities on Discord. The support and collaborative energy I have felt in these spaces is firmly at the root of why I believe the coming of the metaverse is one that is going to transform so much of our lives over the next 10, 20 years and beyond. It’s just such a nice place to be!
Discord servers are communities. Cyber cliques. Digital gangs. Virtual families. This is real life in every way, and the relationships we form there are just as real.
Digital Commodities are Nothing New
We have two decades of momentum coming into this age of the metaverse, and everything is pointing towards its’ success once you’ve done some research.
As Whitney Meldrum-Hanna states in her brilliant thread, we have gone through iterations of ‘virtual consumption’ since the days of Habbo Hotel. People from all around the world meeting in a virtual space, where you can spend real world money on digital commodities to better express your identity in that shared space. The success of Habbo Hotel ($50-74 million/year) led to further iterations of this phenomenon emerging; most notably RuneScape, World of Warcraft, Club Penguin and Elder Scrolls to name a few. I myself have spent money on Sims extension packs in order to better build the world I imagined living in on those platforms. It feels real; if anything more than real at the time.
Whatever your take on NFTs, digital commodities have helped construct alternate identities & build immersive experiences in new worlds.
So, digital history has proven that when there’s a place for us to express ourselves amongst others, and where plenty of others are spending time, we are happy to spend our money and treat it as an alternate reality.
The reason I am excited about how the music industry pivot to this revolutionary market is that there is so much power in the emotion we wrap up in the music we listen to. That is a huge pull.
In The Business of Merch
Who doesn’t love a great band t-shirt.
BBC Radio 6 created Band T-Shirt Day which takes place on the 22nd November. It’s a day to celebrate the rich culture that is etched into the cotton of our history; the long line of printed ephemera that has defined how fans and artists connect beyond the music.
"The T-Shirt is always the biggest seller - for every artist.”
The reason? Because we get to wear it! It is a public display of one’s taste in music. It says something about ourselves, without us having to say it. We may not admit it, but we all judge other’s on their taste in music, especially when it’s an artist we too are fanatics of; maybe even more so when it’s someone we don’t enjoy at all. For me, when I see someone wearing a black t-shirt with the mythological logo of Apex Twin, I feel like I’ve just walked past someone I fought alongside in a past life; it’s tribal.
There is a power in the brand of the musician/s, and the fandom surrounding that brand gets written into everyone’s lives at such a deep and fundamentally emotional level. This is then crystallised in memory, leaving it a poetic target of nostalgia for the rest of our lives to come. There is a reason why people suffering dementia are deeply affected when they hear a piece of music that takes them back to a day when they were themselves, and they begin to smile. That is the power of music.
So when that power gets contained in a vehicle such as an item of clothing, that we can buy for £20 and wear until it falls off us, that is an item that will clearly hold a lot of value to a lot of people, depending on the size of the brand and the status of it as a symbol within society.
Band t-shirts are big business too. The Licensing Industry Merchandisers’ Association reported that the global music merchandise market (of which T-Shirts are a considerable part) was worth $3.1 billion in 2016. It’s a considerable part of a musicians income now, as streaming has taken a great deal of the profits from album sales away, artists have had to invent new ways of selling their work and their brand in order to continue doing what they love.
Run‐D.M.C understood the power of the name as a brand and applied that to their merchandise, as did Wu-Tang Clan with their signature "W". These days, rap groups like Odd Future and Brockhampton have continued this legacy and made merchandise almost as important a part of their identity as their music itself.
There are some recent cases where infamous and rare tees, with real provenance associating it to a specific person or time, have sold for very large amounts. For example, a custom-made shirt featuring stencilled slogans and worn by The Clash’s Joe Strummer recently sold at auction for a huge £22,500. The shirt had been gifted to Clash fanzine editor Mark Jay in 1977 and remained part of the fan’s collection since.
The memorabilia market isn’t going anywhere fast. The powerful combination of nostalgia and people’s search for authentic style means an original band t-shirt will swap hands for considerable amounts. Perhaps not even to be worn, just collected as a piece of history.
Obviously anything with tour dates printed might seem to have a finite shelf life, but such items also work as a memento, a sign that you were there and a much better souvenir than a simple ticket stub.
This is where the utility that is unlocked with NFTs begins to peel away the facade of t-shirts just being t-shirts, and starts to open up possibilities to create new and rich experiences for artists and their fans to connect and belong.
There are even some recent cases where, by attaching the sale of an album to the purchase of a t-shirt, or another item of merchandise that is sought after, artists have somewhat hacked the album charts and risen to the top “on-album-sales.” This ‘merch bundling’ hit the headlines recently when Nicki Minaj claimed the technique was responsible for Travis Scott’s album Astroworld taking No. 1 spot ahead of her album Queen. "Travis sold 200K in his first week of clothes alone," Minaj tweeted in August, calling on the Billboard charts to change their rules regarding how ticket and merch bundles equate to album sales.
Scott and his team came up with an ingenious plan. Every day for nine days, in the run-up to the album’s release, he dropped pieces of merchandise on his website, available for 24 hours. These drops totalled 28 items; everything from ashtrays to t-shirts. Each piece came with pre-sale access to a concert ticket and a redeemable download of the album, and his fans ate it all up, driving him straight to the top of the charts, much to Minaj’s frustration. As a side note, Minaj did also release merch bundles, just less strategically than Scott’s team.
It makes little sense to buy albums today outside of a bundle, where they’re essentially being offered for free alongside something else of value — which is where Apple Music and Amazon might get left behind. Music is simply not enough to sell albums anymore.
It’s well known nowadays that many artists are at war with the big labels in terms of finding a balance between having the freedom to create what they want and receiving a fair share of the revenue generated. Too many artists nowadays end up being exploited by the fine print of the contracts they sign. This is a tremendous waste of creative potential, because the majority of artists are simply trying to find ways to connect with their fans authentically and just deliver the experiences and value they inspire in them.
This friction between the corporate exploitation and the creative heart is going to lead artists to search for new and novel ways to release their work, and connect with their fans in a way that is sustainable, exciting, and fair for all. I think NFTs and web 3.0 is a serious contender for that no. 1 spot, standing as a beacon for community-focused, collaborative projects and releases for that new world to be built upon fairly.
The Role of DAOs
There are examples of how interactions in a community between consumers and creators can be beneficial to all when the contract, the product and its’ utility is designed with intent to reward all. That, as I believe it, is what a DAO is meant to be in its’ most basic sense.
When you see a crowd at a concert all moving and swaying as one with lights in the air, it feels like an organism of people in unity with one another. That is a pretty strong metaphor for the strength of a DAO. Imagine the strength of all of the people at the Oasis gig in 96’ if they had all come together under the flag of the GallagherDAO to be a part of the fabric of the band; getting rewarded for being there then in all future value accruition going forward?
The power in unity and the shared emotion around music, especially the live experience of music, is a strength that lasts the rest of your life. Maybe Oasis isn’t the greatest example, as they could hardly get on as a pair, never mind inviting 100,000 in to the room to talk. But there is definitely a way that this could be model for how creators and their communities rally together to support one another, usurping the current monopoly that labels hold over artist’s output and income.
There have been some examples of bands dipping their toes into NFTs, but these have been very basic and are really just attempts to grab at something they haven’t taken the time yet to fully understand.
This is a trend that is occurring with increasing frequency in the fashion world, as brands and organisations try and come to terms with the opportunity that is emerging around the metaverse, but who lack the knowledge as to how it works, and how to build for it.
Cathy Hackl, a futurist and metaverse expert talks of this in Vogue Business: “You’ll see lots of brands doing one-off things to dip their toe, but then taking a step back to really think about the longer-term metaverse strategy.”
Kings Of Leon released their latest album with a series of NFT collectibles earlier this year, granting front row seats for gigs and exclusive artwork. However, there’s a lot more that can be done than just that, and once artists start seeing that this new model of content creation is open for full experimentation, I think we’ll start to see the industry pivot to a new standard, that places the creator and their ’brand’ at the centre of the narrative once again, but in a way that is wholesome and under complete creative control of the artist and their community.
Case Studies:
Two really interesting examples of how communities have come together to create merch that transcends the meatspace are: Sockz DAO and the Rare Pizza Raffle Ticket.
For Sockz DAO, if you own one of supergremplin.eth’s CryptToadz, then you have the opportunity to redeem one free pair of socks, as we all know, “Toadz need Sockz for warm feet”.
Staying true to our mantra that “1 Toadz = 1 Sockz”… Coming this Saturday (Exact Time Tentative), holders of CrypToadz will be able to mint 1 Sockz NFT (ERC721) for every CrypToadz NFT they hold. Those who choose to keep their Toadz’ feet warm will be allowed to trade and sell their Sockz on OpenSea and participate in future events exclusive to Sockz Holders Only.
So right there, you have an exclusive drop to Toadz holders, that they can either choose to redeem and materialise into meatspace, or leave unredeemed in the meta verse, for exchange on OpenSea, and also for exclusive access to future events!
If you start thinking about these layers of utility in a realm of band t-shirts and further collectibles, then you can start to see where this could possibly lead.
The second example, the Rare Pizza Apparel VIP Ticket, demonstrates further utility in purchasing access to a piece of apparel in CryptoVoxels, released by the people behind the PizzaDAO.
This NFT grants exclusive privileges!
Owner of this token will receive:
(1) Raffle entry to WIN a Rare Pizzas Box NFT
(1) Single item from the genesis apparel collection being launched
(1) Surprise CryptoVoxels wearable
Access: Private VIP channel in RarePizzas Discord
CryptoVoxels parcel as a collaborator for the creation and minting of wearables
There you have multiple exclusive access across a range of channels that the PizzaDAO community are active within. As a member myself, and a contributor of a Pizza Topping, I love the experimentation and play of this community, and the determination to get as many people involved as possible. They are a really caring and creative community in the NFT space, and one of the first I got involved in.
But these two examples demonstrate where merchandise within the music industry, when developed for digital utility with decentralised blockchain technology, could really be taken in the future.
In summary, it’s all about utility, utility, utility; backed by the power of a brand/creator.
Conclusion
As a final word, I’m no musician, but I am most definitely a fan of music. We’ve seen streaming transform how the music economy works, and it has done nothing to empower the artist.
It’s only a matter of time before organisations intent on solving these issues with decentralised platforms. Enter, Audius.
It’s clear the industry needs to change, and Audius are already trying to capture this market with a successful round of funding that has attracted the likes of Katy Perry, Little Nas X and Jason Derulo in securing those funds. It’s leading with streaming, ensuring artists can “safely upload their music on the platform and have an immutable record of owning that content.”
However their mind is on a lot more than just the fair uploading of music: “Streaming is just one small, albeit meaningful, part of its business model,” said Martin Bandier. “The blockchain is enabling entirely new revenue streams for artists and creators, like NFTs, social currency, and curation.”
I think it’s a really exciting time to be speculating on alternate modes of commerce, empowered by blockchain technology and the sense of community and exploration that the metaverse is inspiring in people around the globe.
This is an economy where creators and fans - not middlemen - own the upside from their work. To put it simply, I believe that this is the future of the creator economy.
Please share this post if you enjoyed reading it. Let’s explore web 3 together!