Roger Wilco: Embracing New Business Models

Nov 22, 2004

By John Hennessy

Xeni Jardin has an interview in Wired magazine with Jeff Tweedy of the band Wilco. The focus of the interview is on Wilco making its albums and other music available online for free. The article highlights the contrast between a band willing to embrace a new model and an industry association clinging desperately to what has worked for years.

Jeff Tweedy’s position on free music is quite different from that of the Recording Industry Association of America (RIAA), which continues to bring legal action against those who download music. “Treating your audience like thieves is absurd,” says Tweedy. “I don’t believe every download is a lost sale.”

Sales of Wilco’s albums, even after being available for free, support Mr. Tweedy. Yankee Hotel Foxtrot, Wilco’s first album to be made available for free download, debuted higher on the charts than any of their prior releases. The subsequent album, A Ghost Is Born, also pre-released for free download, hit No. 8 on the Billboard charts – their highest position to date.

When fans found Wilco’s album A Ghost Is Born for free download on Peer-to-Peer networks, an interesting thing happened, according to Tweedy. “We were contacted by fans who were excited about the fact that they found it on P2P networks but wanted to give something back in good faith. They wanted to send money to express solidarity with the fact that we’d embraced the downloading community. We couldn’t take the money ourselves, so they asked if we could pick a charity instead. We pointed them to Doctors Without Borders, and they ended up receiving about $15,000.”

“When we released A Ghost Is Born,” says Tweedy, “we decided to do that in an enhanced format for a number of reasons. We get to deliver more art that way. It’s also a concession to the fact that we’re artists who do work within the industry infrastructure. This offers something more than a downloaded MP3 can.”

Wilco continues to periodically make live performances and exclusive tracks available for free download on their site.

Moderator’s Comment: Are old business models and practices limiting the execution and organic sales benefits of true loyalty marketing?

You might not have thought I could move from Wilco to loyalty marketing. Similarly, there are some retailers who don’t think they can move their organizations
from buy-based practices to a customer-focused approach that concentrates on organic sales. Like the RIAA, they’re clinging to what’s worked in the past.

The transition is not easy, but it’s easier when it complements rather than replaces existing practices. As an example, Wilco embraces both new and old
models by offering free downloads and adding unique content to its commercial releases.

Many are beginning to appreciate how organic sales improvement can come from understanding and responding to shopper preferences. They are realizing terrific
returns thanks to the efficiencies built into their operations and supply chain, a great way to complement old with new.

I’m reminded of a quote attributed to W. Edwards Deming: “It is not necessary to change. Survival is not mandatory.”
John Hennessy – Moderator

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