Music Data Decoded: Distribution & label services
This article is the first installment in Music Data Decoded, a follow-up series to our State of Data in the Music Industry report.
In this members-only series, we dive into the role that data strategy plays across different industry verticals, to uncover more sector-specific insights and keep the conversation going beyond our original report in a more focused, nuanced manner.
Each installment will feature perspectives from a hand-curated slate of industry executives, many of whom nominated themselves for an interview in our original State of Data survey.
If you want to participate in today’s recorded music business, you will need a music distributor.
From self-serve tools like CD Baby, TuneCore, and DistroKid to exclusive services like Stem, Absolute, and The Orchard, distributors are the gateways that help artists to monetize their music across streaming and social platforms.
As the first touchpoint for many artists entering the music economy, distribution also stands on the front lines of practically every critical industry trend and debate — whether it’s the growing "middle tier" of artists, or pressing challenges like streaming fraud and creative AI tools.
With so many new distribution services popping up over the last decade, the market is also more commoditized and overcrowded than ever. It’s increasingly difficult to discern meaningful differences between offerings, and even the best-funded distributors are operating on razor-thin margins.
This commoditization has ramped up competition, leading to a string of ongoing mergers and acquisitions. At least half a dozen indie distributors are currently fundraising or exploring exits, influenced by factors like the growing impact of AI and the challenge of retaining mid-tier artists who might opt instead for major label deals. On the flip side, major labels like Warner are acquiring distributors as a defensive move to maintain market share and enhance their A&R capabilities, especially as the independent sector continues to gain ground.
The few remaining “truly indie” distributors are scrambling to set themselves apart — whether by expanding into hands-on artist and audience development, focusing on superfan engagement, or automating social marketing efforts. The immediate urgency is clear: Establish a sustainable long-term business model, or risk obsolescence in a market where survival often hinges on being acquired.
Amidst these shifting market conditions, we’ve decided to kick off our music data follow-up series with a deep dive into distribution, because understanding distribution is key to grasping the future of music data at large. By analyzing how distributor data influences artist strategies, and how broader industry data informs distributors' own business decisions, we can gain insights into the future of independence, artist leverage — and perhaps even the meaning of artistry itself.
To explore these critical issues, we conducted in-depth email interviews with key product and data leaders at top distribution and label services firms — many of whom nominated themselves for comment through our original report survey:
- Symphonic Distribution: Alison Lieberman, VP Product
- Downtown Artist & Label Services: Nikki Pagliaro, Product Manager
- FUGA: Sam Thomason, Senior Audience Strategy Manager
- TuneCore: Bennett Henson, Director of Strategy and Business Development; Ben Oastler, Head of Data; and Coleman Haynes, Associate Product Manager
We asked these leaders everything from the most crucial data points they track for their business, to specific case studies where data strategy significantly impacted customer outcomes.
Through these conversations, we aim to shed light on the evolving role of distributors, and the pivotal role their data strategies play in shaping the future of music. Even though the market is commoditized, there's arguably still a significant opportunity to improve music distribution products from a data perspective — especially by creating clearer, more tailored connections between the fragmented data that’s already out there.
Key hypothesis: Audience development drives artist development
Spend enough time talking to people in the music industry, and you'll inevitably hear the question: "Does anyone still develop artists these days?"
In today’s landscape, labels often face criticism for chasing virality and popularity metrics at the expense of artistic quality. While many A&R professionals might push back against this notion, there’s a real debate at the heart of the critique: For serious artists today, do they need more support in honing their craft, or in growing their audience?
As the economics of consumption and royalty tracking become more commoditized, distributors are expanding into various forms of label services offerings. At first glance, it might seem like they’re stepping into the realm of artist development. But when you look closer at what’s actually being offered, the focus is more on audience development.
There’s a crucial distinction here. Artist development is about nurturing talent and helping artists create compelling music. Audience development, on the other hand, is about strategically growing and engaging a fanbase to support that music. This difference is key when artists decide which services to partner with. It also sheds light on initiatives aimed at helping artists connect the fragmented data points within the music ecosystem.
The objectives of the TuneCore Accelerator are all about growing an artist’s reach: “Drive the discovery of their music, build their audience, and promote deeper fan engagement,” as their landing page states. FUGA has a dedicated Audience Strategy team that focuses on areas like audience research and segmentation, social media strategy, and digital advertising services. Symphonic Distribution offers marketing diagnostic and analysis services as part of their wider digital marketing toolkit to artists.
Focusing on audience development makes sense. According to MIDiA and Amuse’s latest artist survey, 81% of artists see “being heard by as many people as possible” as a key indicator of success. Getting songs onto digital service providers (DSPs) is just the first step. Soon after, artists face more nuanced decisions: Which social media platforms should they engage with? Which playlists should they target? How should they execute marketing campaigns? The hope is that the fragmented landscape of music distribution will lead to a wider array of potential marketing partners that artists can choose from, based on their specific needs, resources, and career stages.
From the distributor's perspective, the underlying hypothesis is simple but critical: An artist's development is intrinsically linked to audience expansion. Building a sustainable career depends on reaching listeners and transforming them into dedicated fans. With an overwhelming number of new releases flooding streaming platforms, merely having music available isn't enough. Artists and their teams must understand not only where their music is accessible but also who is engaging with it. The challenge lies in connecting fragmented data points and deciding which metrics truly matter — and why.
The challenge of measurement — and the power of visualization
Data fragmentation remains a significant hurdle in the modern music industry. Our State of Data survey respondents cited fragmentation as a top-three challenge across nearly every part of the music data stack.
Our interviews with industry professionals highlighted the complexity that this fragmentation creates, even for larger data teams. Nikki Pagliaro, Product Manager at Downtown, puts it this way:
“Our teams use a variety of bespoke and SaaS platforms and tools for data operations and insights (think BigQuery, Heap Analytics, Airtable, Audioshake, Symphony OS, DSP APIs, etc) and part of my role in technology is to ensure that our stack is always working in the best interest for our teams and clients. From client services and operations to legal and trust & safety, to finance and core product, I would say it’s impossible to have a strong ‘data strategy’ without excellent cross-department alignment on lean technology efforts, given how fundamental it is to our entire business. ”
Now, imagine not having access to these resources at all. Would you even know what to measure?
Independent artists often face this dilemma. While they've significantly contributed to the surge in music releases, they frequently lack the teams or managers to guide them properly. As the TuneCore team noted: “The broader trend of democratizing access to data is incredibly powerful for artists, but only if the data is easy to understand and actionable.”
This is where distribution companies can make a real difference in artists’ lives. With access to extensive, multiplatform data and in-house expertise, they can help artists understand not only who is listening to their music, but also how they're being discovered.
Hence, for many distributors, their product focus is shifting into expanding an artist's understanding of their performance across streaming and social media, mapping audience growth in a more holistic way. As Alison Lieberman, VP of Product at Symphonic, tells us:
“We’re closely monitoring … the ability to attribute and correlate music consumption patterns. Drawing a clear line from discovery to fan conversion is super beneficial, and connecting those dots for our clients adds significant value. Pinpointing why there was a sudden drop in monthly listeners, or a spike in streams on a single platform, is something we’re able to assist with, and we’re working on incorporating these insights into our platform even more.”
The kinds of questions distributors get from their services clients depend on who exactly is asking. As Sam Thomason, Senior Audience Strategy Manager at FUGA, tells us:
“I personally use social listening and audience segmentation tools to drill deeper into fan groups and ask specific research questions that are brought to me … While [artist] teams will ask things like key platforms, countries to advertise, etc. (mechanical stuff), the artists themselves typically want to know what it is about their artistry that draws fans to them. ”
As far as visualization, our State of Data report found that over half of those accessing distributor data do so via web-based dashboards. This trend toward dynamic, real-time data presentation aligns with major streaming platforms, suggesting a broader industry shift away from static reports. The TuneCore team highlights the importance of web-based interfaces in providing immediate insight to their customers:
“TuneCore’s current reporting products allow our artists to explore their sales performance data beginning from their first sales record at TuneCore, and we collect & surface additional data that is more ‘real-time’ that could be more effective in an artist’s understanding of how they are performing at present. Our user’s sales data is immediately available to them in their Sales Report UI, where they are able to filter their sales data as it comes from the store in a more user-friendly interface compared to the raw data. The raw data is also available in the form of a downloadable CSV should the artist wish to explore their data down to the individual stream & download for each store, release, country, and posting period.”
Addressing operational questions can be straightforward, especially when they're specific. Lieberman gave an example of assessing the ROI of enrolling in Spotify's Discovery Mode. By tracking data on a single platform, artists can see if participating leads to more followers or ticket sales through their Spotify profile.
However, as soon as you introduce additional data points from other platforms, complexity increases exponentially. Lieberman's graphic illustrates how layering data complicates analysis:
While tracking fans across various social media platforms and DSPs is complex, identifying overarching trends is achievable, and data points like royalties and streaming analytics still provide valuable insights into listener behavior at the point of sale. But to genuinely grasp what attracts listeners to their music, artists might need to engage directly with fans.
The power of narrative, from fandom to fraud
Data alone isn't enough; it needs a narrative to give it context and meaning. Tasks like understanding the listener journey, analyzing marketing funnels, and tracking sales are all valuable, but a story helps tie these elements together.
Right now, the industry is buzzing about "superfans" — those dedicated listeners who amplify an artist's presence and contribute significantly to their revenue. While FUGA’s Thomason critiques this focus as somewhat superficial, he acknowledges its importance, especially in rethinking data strategy for label services:
“In a sense, it’s a step away from volume-driven data understanding, as streaming numbers and follower counts do not necessarily denote true success for an artist — particularly in the long term. Developing data metrics that cut closer to the idea of real fandom is key for the next iteration of the music industry.”
In our State of Data survey, 82% of our respondents indicated that they use generic tools like email CRMs and custom spreadsheets to manage their fan data, while only 26% use music-specific tools. The challenge isn't necessarily a lack of interest in building for the industry; the music-specific CRM market is quite crowded and fragmented, indicating strong interest from founders and developers.
The core issue is that "fan strategy" needs to be highly tailored for each artist, fan base, and community. So, teams need flexible, adaptable tools to meet the varying needs of the artists they work with, which leads them to more generic tools like MailChimp, HubSpot, or Notion that have wider functionality.
Similarly, measuring fandom is complex, and shiny new tools aren’t necessarily suited to capitalize on supposed superfans. As Pagliaro shares:
“What excites me the most these days is just how creatively artists and label services teams are using pre-existing (and more often than not, old-school) technology to facilitate storytelling distribution, coupled with strong label services teams to enhance and connect that story to the right audience that maximizes an artist’s growth and revenue opportunities.”
Narrative drives this process — helping artists and their teams decide which data points to focus on, and how to connect them meaningfully.
Sometimes, the narrative isn't just about nurturing fans, but also about tackling deeper industry challenges like streaming fraud. Lieberman explains:
"Streaming fraud has become a widespread issue that leaves distributors, artists, and labels in the dark about suspicious activity on streaming platforms. Many of our [DSP] clients are sensitive to even small swings in listener behavior. When their music is taken down, royalties fluctuate, or fees are incurred — often without warning — and it becomes a major challenge to manage."
Understanding and combating fraud requires constructing a clear narrative from the data, involving the entire music supply chain working together to interpret complex data points and establish context on why certain listener activities are flagged as artificial.
Whether it's deepening fan engagement or addressing fraudulent activity, data needs a story to make it actionable. Distributors play a pivotal role in helping artists craft these narratives, allowing them to answer critical questions about their audience, preferences, and consumption habits. They help artists and their teams make sense of what a stream really means — not just whether there's a fan behind it, but also, on a more existential level, distinguishing genuine listeners from bots.
The importance of people
At the heart of weaving these narratives are people — specialists who can interpret data and translate it into actionable insights.
Our industry interviews emphasized the importance of human involvement and cross-team communication in making data meaningful. Even when a song doesn't become a hit, data analytics can help artists pinpoint target audiences, suitable genres, optimal platforms, and more. If a release doesn't perform as expected, a thorough analysis can guide improvements for future projects. These tactical decisions benefit immensely from the human touch, as specialists can interpret nuanced data insights that automated tools might overlook.
One significant takeaway from our State of Data report was that cost is just as much of an obstacle as fragmentation to building and scaling an effective music data strategy. Not all artists have access to teams of specialists like those at established distributors; indie artists and those with limited budgets in particular may struggle to achieve the same level of data understanding. While many tools are being developed to assist with this challenge — such as those from Symphony, un:hurd, Naviro, or Westcott Multimedia — the proliferation of specialized marketing software can lead to expenses that rival hiring a dedicated data analyst.
As essential stakeholders on the front lines of independent music, distributors are therefore positioning themselves as genuine democratizers of data for independent artists, through a hands-on, services-based lens. In this way, they are hoping to become not just logistical and financial intermediaries, but also strategic partners in an artist’s journey, leveraging data to help tell compelling stories and drive critical career decisions.
At large, this evolving role of distributors reflects a new industry mindset, where nurturing audiences is seen as central to nurturing artists themselves.
Revisit Water & Music’s previous research on music distribution, music streaming, and data analytics: