What do you buy when you buy merch?

Merchandise is important. It’s important for fans who can express their fandom. It’s important for artists and other rightsholders who use it as an extra revenue stream. But recently I’ve been wondering what you actually buy when you buy merch as a fan. And consequently, what that means for artists who look at merch as a form of revenue. It’s important to ask what kind of merch you want to sell and who your audiences are for it. Especially in a world where platforms like Amazon Music, Instagram and Twitter improve their creator-focus by making it increasingly easy to sell merch I see three major answers to the title of this piece:

  • You buy something physical like a t-shirt, a mug, or a record or something virtual like a skin, an AR filter, or a digital download
  • You buy status, showing off your fandom and gaining access to an in-crowd of superfans
  • You buy into an artist and show your love and, more and more, gain access to the artist

The physical and the virtual

Let’s start by going back to 2019, pre-pandemic. atVenu, a commerce platform for selling merch while on tour, shared data showing that on average people attending concerts continued to spend more because they were buying more merch items year-over-year. This increased the average dollar amount punters spent as well. A positive trend then, but looking at what concert-goers mainly bought the data showed that the most popular item was still a t-shirt and then preferably a black one. Moreover, further data by atVenu from 2019 shows that on average artists bring 17 items to a show while only 4 items bring in 75% of all revenue. This means it’s worthwhile thinking about the combination of merch items you sell during a show. Definitely a t-shirt, preferably a record, then some other form of apparel – depending on your genre it can be a cap or a hoodie or a longsleeve, etc. – and finally something else like the aforementioned mug.

When we move from the physical to the virtual I often think about gaming more than music. That’s mostly because in gaming virtual merch-type items are already a big business. And when music flows into the world of gaming we see the results. Of course, there’s Lil Nas X his famous Roblox show. In an interview with Gamefam, Roblox global head of music Jon Vlassopulos explained how you “could dance together using custom, exclusive emotes, throw snowballs at each other, dress up in custom merch, hunt for coins, etc.” Moreover, these virtual merch items drove “seven figures in merch sales.” And it’s not just an artist like Lil Nas X who drives these sales. Oana Ruxandra, chief digital officer at Warner Music Group, told the CogX conference this year that Why Don’t We‘s Roblox concert also involved good sales of “artist skins, clothing, [and] a number of different accessories.”

The Why Don’t We scavenger hunt in Roblox, Pro Game Guide

That’s what happens when an artist hosts a concert in game. However, with more direct-to-fan strategies like setting up a Patreon or a Discord artists can open up routes to sell virtual merch items that are not necessarily connected to a live event. Moreover, there are many virtual worlds that integrate virtual merch options. All of this will grow alongside physical merch.

Status as a fandom

The reason merch sales will continue to grow is that fans will continue to seek ways to express themselves. It’s often also a status thing. How often have you walked around in your semi-obscure – probably black – band t-shirt and gotten a shout-out from someone random just because you’re wearing that band’s t-shirt. Of course, this particular example can become commoditized like with Nirvana or The Ramones due to their availability in high-street stores like H&M. Yet, this form of status can be used to more effect by many artists today. It’s not just about the t-shirt, it’s about the status that comes with having that t-shirt from that particular tour or with having the ARMY Bomb. Merch can give a fan a place within a broader fandom. Taking a Status as a Service approach, as popularized by Eugene Wei, artists need to have a twofold strategy to merch in relation to status. Items, whether physical or virtual, should provide social capital and have a high utility.

NFTs and social tokens can be one example where ownership can showcase status and thus provide social capital. These tokens also provide a utility in that they often provide access to certain things like memberships, meet-and-greets, unique tracks, etc. Examples unrelated to blockchain can be fanzines that artists recognize or, to go back to the t-shirt, simply getting a shout-out during a concert for wearing a very specific tour t-shirt. Interestingly, this kind of status-recognition can also come from the artist. Eddie Vedder famously jumped from the stage lights during Pinkpop festival in 1992 wearing a home-made Tivoli – a Dutch venue – t-shirt. In 2001 he wore that same t-shirt again at the same festival and now it’s back on his Funko doll.

pearljamonline.it

Buying-in and showing love

Of course, buying merch is always about showing love to the artist. Besides listening to their music, going to their concerts, your fandom goes one step further and you spend that extra buck to show your support. More and more, and especially during the recent periods of lockdown, buying merch has attained a bigger status as a show of love. It’s also changed how artists sell their merch and what kind of merch they sell. This is especially true of platforms like Bandcamp, where the virtual merch table is automatically integrated during the livestream. What’s more, any buyer gets a mention in the chat allowing the performing artist to give that all important shout-out. That’s not just showing love, but getting the immediate status recognition too.

Again, blockchain-based tokens take this one step further. Not only do they allow the type of investment that will let the fans grow revenues as their beloved artist gains more prominence. More importantly, tokens can provide the privilege of access to the artist. This can be in the form of 3LAU creating a song with the highest bidder of his NFT, but it can also take the shape of a more community-driven solution. In that sense, it’s similar to offering various tiers of access through a Patreon or similar service. The positive extra of a token is that it allows a more reciprocal growth as value can increase over time seperately from the interaction between fan and artist.

Know your audiences, or what do you sell when you sell merch?

The key to understanding these various ways of engaging with merch from the perspective of the fan is to know how to approach those fans as an artist. Not every fan is the same, nor do they want the same. Realising that you have multiple audiences as an artist allows you to strategize accordingly. There’s many ways to do this. One example is terrible*, a company that takes a product management approach to physical merch and helps artists conceptualize, design and deliver products to their fans. In a similar vein, the increasing focus on utility in relation to NFTs shows how artists are thinking about adding value for specific fans. Whether it’s physical or virtual, and whether it’s about status or showing love, what matters is that merch is about more than just selling something. More and more it’s about establishing a connection and doing so with a broad variety of your fan audiences in mind.