It’s not very often that you get an opportunity to learn about marketing by studying a rock band.  But that changed today.

If you haven’t heard the news yet, let me fill you in …

Each year, there are about 12,000 record albums released.  Until now, all of these albums were released by artists through record labels. 

The record label acts as a distribution partner.  Obviously, that means that the label takes a cut of the sales.  In fact, that’s usually a pretty large cut.  This leaves the artists to share the remains among what is often many people.

One entrepreneurial band, though, is changing this model.

Today, a group known as “Radiohead” announced the release of it’s long awaited album, “In Rainbows”. 

Ordinarily, such an announcement wouldn’t make me even read the entire notice.  (I’m much more into the rock ‘n roll of the ‘70’s than the current stuff.)  But this headline caught my eye …

Radiohead Says:  Pay What You Want”

What the heck?  How can the music industry let you pay what you want for an album?  Especially with so many players in the ring with their hands out waiting to be paid?

Well, that’s where this announcement gets interesting.

Radiohead is one of the biggest names on the music scene today.  So you’d think they’d have one of the highest paid record labels too, right?  WRONG!

This band is releasing their album through their very own website!  No record label middleman at all!

That gives Radiohead complete autonomy to do what they want with sales of the new album.  And these guys are pretty sharp entrepreneurs as well as musicians, it seems.

If debuting an albume with no record label wasn’t enough to raise a few eyebrows, Radiohead is making matters even worse by letting buyers “Pay What You Want” and name their own price on this brand new album!

Why would the biggest name in music let the buyers decide how much to pay for their hot new album?  Wouldn’t this mean that they’d make LESS money in the end?

Heck no! 

Actually, it will probably make them MORE money in the long run.  In fact, it could quite honestly mean MUCH more in the end.

You see, these enterprising artists clearly have mastered one of the greatest lessons in marketing …

It’s all about the Back End Profits!

For a band, that “back end” is in sales of concert tickets.  By letting fans pay what they want for the album, it is surely going to cause quite a buzz about the release.  This, in turn, is sure to fuel sales of concert tickets as well.

In fact, I wouldn’t be at all surprised if Radiohead’s concert tours are booked solid for well over a year within a very short time.  And, I’ll bet that it will be next to impossible to get a seat in any of those performances within hours after tickets go on sale.

That’s the kind of power that you can create when you give something away on the front end of your sales funnel.

But that’s not all Radiohead has in it’s plan.  Their website is chock full of products other than the new album, too. 

On their website, Radiohead offers everything from tshirts, to jackets, to nightshirts, coffee mugs, calendars, and many other assorted items as well.  Each product has a different design on it, all of them unique and very descriptive of the band’s style.

This gives Radiohead a very full sales funnel.  As all marketers know, the lifelong value of a customer is much greater than what is made on just the first sale.

NOTE:  Of course, they’d probably sell a lot more if they used a more common currency like US Dollars instead of British pounds, but hey, they’re only musicians!  What else can you expect?

Since these products are being sold from the same exact website the band will use for it’s “Pay What You Want” promotion, sales of all of their products are sure to increase when the album debuts.  That’s what marketing is all about!

And, by having a full sales funnel, Radiohead can plan on making sales from those buyers who name their own price on their initial purchase, for quite some time to come.

Now, let me ask you a million dollar question …

How can you use Radiohead’s example to increase profits in your own business? 

Well, let’s take a look!

Current Plan

Let’s say you have a product that you sell for about $100.  You normally sell about 5 per month.  That would make you $500. 

You also have a weekly teleconference that you charge people $27 to attend.  You regularly have about 20 people on that call.  That makes you another $540 per week.  With 4 weeks, that means you’d make $2,160.


What could you do to implement the Radiohead marketing strategy in your business and use it to increase your income?

New Plan

Well, instead of doing a paid call each week, why not do a FREE call?  You could then sell your product on that teleconference.  Here’s what would happen …

You could continue to hold a single teleconference each week.  Now, instead of getting 20 people to pay, though, you get 50 people to attend for free.  The call goes over really goes over well. 

Of the 50 people on the line, 20% of those hearing it buy your $100 product.  That would mean you’d make about $1,000 per week (or $4,000 per month if you do one each week).

The call goes over so well that you decide to put the recording up on itunes.  Again, you don’t charge anything for people to download your audio.

Over the next week, about 1,000 people listen to the recording.  About 10% of them buy your $100 product.  That brings you another $10,000 for that week.  (Again, if you do this each week, you could bring in  $40,000 for the month!)

With this new plan, you’re giving up the $2,160 of income from the telconferences.  BUT … you are adding so much more income in product sales!


That’s a 2,000% increase in your income!

Can you think of any other ways that you could use this?

Make a list for yourself right now, while you’re still thinking about it!  Tomorrow, take one step forward to implement your idea!

To Your Abundant Online Success!

Gina Gaudio-Graves


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