Universal Music Group Using Big Data For Big Decisions

For most of its lifetime, the music business was run on the gut instincts of its executives in everything from artist signings, which songs to release as singles, marketing, promotion, and just about everything else.

The major labels of today and their precursors were built on these decisions, but we live in the age of Music 4.0, where just about any decision can be a lot more precise and pragmatic, thanks to the influx of data on just about every aspect of the business, and that's exactly how Universal Music Group is going about things, according to an article in the Wall Street Journal.

The company is using a new software tool that was built in-house called Artist Portal to help its execs make smarter marketing decisions. The app allows a user to track everything from artists sales, music streams, airplay and social media buzz happening globally and in real time, then overlay sets of data that include television appearances, concert dates, commercials featuring an artist's songs, social media posts and promotional events. This allows the company to be able to better analyze sales and interest spikes, which in turn helps it to better allocate marketing funds as needed.

Something that's a bit more insidious is that upper level label management can also track how much each Universal employee uses the app, which could play into future staffing decisions, which seems to take the gut instinct out of the picture entirely, which at least some is needed when it comes to creating, selling and creating art. That said, the tool is proving a big help in a variety of ways, with one major example being that its data used as a help to show promoters in Finland that there was indeed an audience for the label's hip hop acts in that country.

UMG isn't the only major label to employee a big data app though, as both Warner Music Group and Sony Music are also developing their own versions of Artist Portal. In fact, Sony now has 25 people on its analytics team, showing its deep commitment to the concept.

I equate this to baseball in that it took the sport a long time to begin to use precision metrics to help executives get a better picture before they made their biggest decisions. It took the music business a long time to come to the same party, but big data is now becoming a major part of the way a major label does business.