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Interview with PATRICK FAUCHER, CEO of Nimbit - June 21, 2010

“We are not just answering a single problem, we are helping build a sustainable business and an ongoing relationship with your fans.”

picture If you want to make a career out of music then, as an artist, you should not only be in tune with your muse, but also your brand. As those of a creative bent are not naturally predisposed to marketing and business management, that might come as a blow. Fortunately, online tool are emerging to make it a painless and even rewarding experience. Nimbit has been making waves because it claims to offer a complete solution, combining direct-to-fan marketing, sales and distribution, and business management in one easy to use online platform.

HitQuarters speaks to its CEO Patrick Faucher about how Nimbit can help generate fans and profit and re-organise your music business, he also talks about the power of artist-fan relationships and whether fan funding models are akin to artistic prostitution …

Why is a direct relationship with fans so important?

It’s a very powerful relationship. You become the patron of what you're doing. Secondly, you know who they are. You don't get the customer data when they go through a third-party retailer. And finally, you can create a relationship with a fan to help you to get more fans and so they become your best marketing channel.

For an artist that is willing to embrace that, be creative and have fun with it, has qualified business person to help him execute and has a platform like Nimbit to do it, we see absolutely phenomenal results.

So what exactly does your platform offer?

At the top level Nimbit is an integrated end-to-end direct-to-fan marketing sales and distribution engine, where the artist can very quickly engage their fans and start capturing their fans at all the touch points they have online and after shows as well.

We have tools that help them do all of this. From e-mail sign-up, track for e-mail, direct to fan storefront, download card programmes that capture the fans physically by handing out cards after the shows and have the fan redeem free products, promo codes etc. The fan capture piece is the front end of the funnel.

The second piece is - we provide a complete direct-to-fan storefront and merchandising system for them to publish product offers whether that is a digital file for sale like an MP3 track or album, a digital file for promotion to give away, a physical product like a CD or a T-shirt or a bundle where you can bundle a track with a T-shirt or a ticket with a CD.

We offer complete catalogue management where you can put products into your storefront such as digital goods, CDs, merchandise, e-tickets and bundles. We also provide full service warehousing and fulfilment for your physical goods. You send us your physical inventory. We are the leading platform for storefronts.

The third component is we have an end-to-end marketing and fan messaging suite that lets you do sophisticated HTML e-mail marketing as well as coordinating your messaging out through Facebook and Twitter and other social media channels and do it all in one place where you're already managing your fans and sales. That allows you to integrate your data.

How can you then use the data?

You can pull up your fan contact sheet and say, “Give me all the fan data in this area that have spent money with me, then tag them as a group and build an e-mail campaign and send that campaign out.” All of this can be done within about 15 minutes.

You begin to see real-time results on who is opening the messages, where did they open them - was it e-mail or Twitter - who has clicked on the link, who has purchased and how many sales have come through that campaign.

You can use the data in creative ways and then see the results from what you did. There are lots of ways to target your fan group.

How does it work with the emails for example? Are the amount of addresses you use limited?

No, it's unlimited but we have pricing depending of how much you use. You can send emails right away or schedule them. Send them as simple text or you can build your own template and send a pretty HTML email. We have our basic templates that you can modify to be your own newsletter header. Those templates can include dynamic calendar dates, product offers straight out of your storefront, promotional links that allows someone to redeem free products etc …

We also have a thing called ‘campaign manager’. Let's say you have a release coming up and you want to message the fan base a couple of different times over the course of three weeks - you want to send some e-mails, do some quick shout outs on Twitter and have some updates on Facebook - you can schedule all these messages with different content and add them to a specific campaign and that campaign is tracked as a unit in your system.

As these things go out you start seeing results in the report and it shows you how successful that campaign was and you can also check how successful a particular message was.

You’ve recently brought Nimbit functionality into Facebook – how does that work?

We are always looking for ways how to exploit the Facebook API. One thing we did last year was build a version of our storefront tool that is 100% in Facebook, an application called MyStore.

It utilises your Nimbit catalogue and publishes a storefront right on your fan page so when fans go there they can sample your music, comment on it or share it on their page. It all happens natively inside the Facebook and takes advantage of the social craft that's there.

If I'm on your Facebook page and I do something in the MyStore like comment on the track or buy something, that goes up to my news feed and my friends see it and their friends see it. It takes advantage of the viral nature of Facebook because you're not leaving Facebook to go to some other site like iTunes for example. We are the leading music e-commerce application on Facebook.

Everyone that you have an interaction with gets captured on you fan list in Nimbit. People that got in touch with you through Facebook, MySpace, your website, purchases, promotions, all of these different ways to engage with your fans come in to a central fan list in your Nimbit account.

If I want certain merchandise products can I send you a JPEG and you put it on cups or T-shirts for example?

We have a side business that does print and manufacturing services. So if you need a poster, download cards or CDs made, we have a service division that will actually do that in-house.

For T-shirts, cups and other types of merchandise we have a network of partners that we can connect you with.

What is the pricing like for the different services?

To just get on the platform and start using the fan marketing and e-commerce tools it's free.

The next gear up is $12.95 a month and then $24.95 a month, where you get the ability to do things like HTML e-mail marketing, more sophisticated promotion tools, the ability to publish a custom storefront.

At the $12.95 a month price point you get 2,000 e-mails per month included, that's based on the number of messages you send. If you send out more than that every given month we will tell you that you are going over and there is a small fee.

But if you upgrade to the $24.95 a month Nimbit pro plan you get 20,000 e-mails per month. Along with that comes the warehousing, the catalogue management and the analytics.

Do you take a percentage of the sales on top?

Yes, 20%. If you sell a CD for 10 bucks we keep 2 and pay you out 8. That covers all the costs of warehousing, processing, handling, customer support and all that.

For e-tickets we take 9.75% of the retail sale price. We capture the person's contact information and e-mail and then they simply present their ID at the venue and we give the details to the promoter or the venue.

Are you somehow involved in the publishing side as well?

We don't do anything directly with publishing right now but we are exploring some partnerships where you will be able to submit certain licensing opportunities for film and TV simply by being on the platform we have a number of music supervisors and publishers that are looking for new material.

If, for example, I want to sell my CD it through Nimbit but to sell my merchandise through another company - is that possible?

Yes, you can do that. But if you sign up for Nimbit Pro, you get everything. In our mind it's a shame if you don't take advantage of the whole thing because you end up spending more money and time getting your stuff done.

But if you have someone for example who is dealing with T-shirts and merchandise sales you can certainly keep that provider and you'll have two different ways of how fans can buy from you.

We are about to announce a partnership with a company called JSR that does high-end merchandise, tour support and distribution, where they are going to fulfil the physical pieces.

What do they do with regards to tour support?

They advance you the merchandise on a tour and take a bigger piece on the back end. But that is only for certain artists that are going out on a national and international level.

What are the terms and conditions to cancel the service with you?

You sign up, there is a monthly fee. You can cancel at any time and we sent you your stuff back. There is no two-year contract or something.

How much programming knowledge do I need to have to use your service?

Zero. I mean you need to know how to use a web browser, upload graphics and fill out a form. You simply sign up and then set up your products through your online dashboard.

Beyond that there are different ways to publish a store. For example you can do that by placing the LMT, which is a small e-commerce widget, on your MySpace page. It's an application in your MySpace library and the same goes for your Facebook.

To put a skin and a custom store on your website we can do that for you if you don't have HTML knowledge. It takes a day and costs 99 bucks. But even with a little bit of HTML knowledge you can do it yourself. You simply go in and configure your store and how it's going to look and It generates a HTML code that you then place on a page on your website and that's it, copy and paste.

Do you help the artist with setting up a marketing plan - how to use your tools in the best way, how to schedule things etc?

We have some very good partners that do just that. The pricing goes from a couple of hundred dollars to $2,000. Depending on how much the artist is willing to spend on counselling in advance we can point you towards one of our marketing partners and they will help set up a plan for your and execute it.

We are looking at expanding that program a bit more because we realise it's a big need. We are starting to offer a basic on-board service that helps you to get set up and gives you some basic ideas. The product itself will lead you through the steps that you should be doing. If you sign up it will say, ”Make sure you do this first, second, third ...” That is something that we're trying to work on constantly to improve and tweak based on feedback.

We know that some artists are just not able to spend a thousand bucks on consulting but that's realistically what it would cost to craft a good plan. What we are trying to do is make it very economic for people to learn what they need to do.

Maybe if you put up examples of how other people are using your tools successfully and then show their marketing plan then that would help?

If you go on there is a whole box of get educated content and a whole section of case studies of what people have done in the past that has been successful. And there are also what we call foundation articles and best practices on our website that gives you some advice for free.

At what stage of their career does an artist have to be at in order to benefit from your service?

Any artist that is actively producing content and out there engaging with fans can benefit. If they are gigging, if they're online, if they are creating an audience, or if they are just at the beginning of that journey, then they can use our system to help them capture more fans and later on they can use our products to offer and market themselves.

It starts at the point of building a fan base. That can be at a fairly low level. As long as the artist is active, producing, looking to engage and build a fan base and monetize that fan base they can start with Nimbit. You can sign up for free and then we have premium versions of the platform where you can do more sophisticated things as you grow with your business.

How did you first get involved in the music industry and how did that lead you to Nimbit?

I've been a musician my entire life. I graduated from Berklee College Of Music back in the early 90s. Prior to that I actually studied computer science.

So I had a technical and a creative background. I gigged professionally throughout the 90s with various bands and from there I realised how difficult it was to earn a living. That led me to the path I am on now with Nimbit providing a platform for direct to fan marketing and distribution. I founded the company in 2002 and launched the first version of Nimbit in late 2003.

Prior to Nimbit I was working for 3 ½ years in a company that did high-end e-commerce for bands like Aerosmith, Fish or the Rolling Stones. It was very cutting edge. These were the first generation e-commerce sites in the late 90s. Only the biggest name bands could afford to do that because it required a lot of resources and money to put up a good site that fans could go to and buy from in a direct way.

That company got bought during the dot-com boom, got big and then closed down. Around 2002 I decided, “You know what? You shouldn't have to be as big as Aerosmith to be able to get online to connect with your fans and run a business as a band. We just need to put the right tools together in the right way and make it affordable and easy enough to use, so that any artist can use it.” That’s basically the concept behind Nimbit.

As an artist how much do you have to concentrate on business and how important is it to just be a creative artist?

As a group, artists are not predisposed to wanting to handle the business side – they’re even averse to it – but by necessity they have to be more involved nowadays. So here's a challenge, we are creating workflows that help the artists move through the process of the business aspect.

That said our platform is most viable to an artist that has a manager or at least someone that is proactively taking on that role. That can be someone in the band but ideally a third-party that is taking that on and making sure the artist is getting involved in the creative marketing.

We believe the best formula for success is to have a qualified professional who is your manager, who is looking out for the business interests of the band. They are making sure the artist is fully engaged in the business and willing to connect with their fan base and provide them with reasons to engage and buy directly.

How do artists avoid coming across as a blatant sales person, such by twittering “Buy my new CD!”?

To be an artist and do it as a living means everything you do is part of sales.

The artist-fan relationship is not only centred around the music but also around the personality, the world and the culture around the artist. So creating conversations around that is the core. That's authentic - you can’t fake that.

There’s obviously the music to talk about - why you wrote a certain song, who your influences are … That's a conversation that many of your fans will be interested in. Then there is just you, what you are into, lifestyle, culturally etc.

At a certain point you have to offer a fan the opportunity to support you. Maybe you don't want to say, “Buy my CD!” instead maybe you say, “You can have that song for free but if you want to support me there is some other cool stuff that you can buy.” Merchandise, tickets to your show, backstage, meet and greet … whatever it is. At some point you have to monetise the relationship with your fan.

Also I would challenge the notion that every person that will get an email saying, “Hey buy my CD!” is turned of by it. If you are into the artist why wouldn't you want to support the artist? The answer to that depends on whether you are an incidental fan, a casual fan, an active fan or a super-fan.

What do you think about the concept of fan funding, which takes fan support to a higher level?

It's about patronage, whether it's a way to pay for access, or a clever way to bundle up products around the artist that fans are interested in because they want to collect them.

We think fan funding is huge and in case there is an article on our website about a guy who raised $100,000 directly from his fans to record his album. I love the idea auction of dinner with a band, auction of a house concert.

You don't you think the artist is whoring themselves out by doing this? There is no mystery around it, you’re just selling everything …

I think you get a bit too hung up about that. Do you need to create some mystique around the artist? Sure! Just because you are offering a backstage pass that's not diminishing that.

At the end of the day, if the artist wants to continue doing what they're doing, somebody has to pay them to do it. Now in the past the record label would pay them and the record label would whore them out to the market and exploit them - sometimes in ways that the artists didn't like but the artist didn't have a choice because of the contract with the label.

Now unless you get one of the very few label deals that mean anything today, you are left with two choices - do it as a hobby and find something else to pay your bills or find a way to make money creating music.

It's about your music, you and the culture around you. You have to be creative and find ways that fans are willing to pay for this experience. I wouldn't look at it as prostituting yourself. It's more like I'm here to make a living. This is the value that I'm providing. My way of contributing to people's life through my music and here's a way for you to support me in doing that. Get over it and get creative with it!

How is your service different to what your competitors offer?

Well let me ask you this, who are our competitors?

... Topspin, and there is also a free site called Bandcamp ...

Well, Bandcamp we can take off. They have some good tools to publish your digital content - it's a way to put a widget up and sell some music - but they're not an end-to-end direct-to-fan platform. We are offering a complete platform for engaging with your fans and building a business, not just MP3s - everything from tickets to pledges, to bundles, to downloads to whatever.

Topspin have some really sophisticated high-end tools for bands that have a professional behind it to craft a sophisticated marketing plan. You get a lot of fancy charts and you're actually required to do some tactical implementation with them. That's a different engagement.

Compared to that you can sign up for a Nimbit account for free, capture fans then upgrade and be able to do everything, to market, engage and sell directly to your fans.

Topspin is targeted towards the high-end marketing campaign. Nimbit is targeted to, “Hey, I want a widget to sell my music with an end-to-end solution.” We are not just answering a single problem, we are helping build a sustainable business and an ongoing relationship with your fans.

Where do you see Nimbit going in the future?

I think we are going to continue improving the functionality and the usability of our core tools - the fan engagement, the storefronts and the business management.

We try to make the fan experience a really good and compelling one. For an artist to use our platform we want the fan to be thrilled with everything.

The second piece that we are going to focus on is something you touched on earlier, which is putting together quick easily doable programmes that walk the artist through mini marketing exercises - something that helps them build a fan base and build their sales. It will be focused on what it is the artist needs to be doing, what motivates them to do it and then trying to make it easy.

How important do you see the usual marketing tools like TV, radio and print in the future?

There is still a value in traditional media. Radio still is very powerful in certain markets and in certain genres. Getting on the radio is hard to navigate. That is something where labels still have a role. But even that is starting to shift. I hope that radios are finding other ways to find content then just from the labels.

Print? I don't understand why anyone would spend a dollar on print advertising in music campaigns. But press, getting an artist written about in the regional market newspaper or in the indie press, still has some value. Certainly the blogs are stepping in there.

In the end nothing replaces hustle. If you take two equally talented artists, the one that gets the cheese is the one that hustles for it. It's an art form, it's like booking gigs, you got to get out there. There is no silver bullet or button you click that just puts you in the right places. You got to work it. Nimbit is just a tool to put that work into business.

Interviewed by Jan Blumentrath

Read On ...

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