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Pandora Could Die If It Doesn't Start Listening

Stocks in this article: P AAPL LVY

Harnessing its platforms in ways Apple (AAPL) likely will not. Apple pays publishers 10 percent, but will it leverage its listening data to help the music industry go the extra mile in the digital age?

Highly unlikely.

Consider this tie-in.

Earlier this year, Pando Daily wrote about a small startup called Ticketfly.

Pay attention to the lowdown on the company because it absolutely applies to where Pandora genuinely intends to go, but needs to go -- in force -- now:

Ticketfly has built a reputation for itself as an ally to small- and medium-sized venue owners by offering technology tools that go well beyond ticket sales. The three-year-old startup leveraged the popularity of its social marketing and publishing tools to grow its client base by 128 percent in 2012 to 822 event promoters and venues, across 44 US states ...
(In May, Ticketfly released) its Fanbase customer analytics suite that (allows) venues and promoters to identify, engage, and reward their best customers. The genesis for this new product was the realization that just 7 percent of consumers accounted for 24 percent of ticket orders in 2012, and 30 percent of ticket revenue ...
Fanbase relies on a proprietary ranking algorithm to combine a dozen factors including attendance, purchase history, and social sharing data to create a dynamic ranking of top fans on a per venue, event, genre, and individual performer basis. With this data, promoters can better target and engage their most valuable customers.
This data can be valuable to create buzz ahead of an upcoming event through exclusive pre-sales or premium seating and merchandise rewards promotions. At the same time, by knowing fan preferences and engagement levels venues can more effectively liquidate otherwise difficult to move ticket inventory - all while rewarding loyalty ...

This is all important and groundbreaking (not to mention a threat to Live Nation's (LYV) Ticketmaster), but here's the most important part as it relates to Pandora. Consider what the box office manager of two small clubs in Philadelphia and Wilmington, Delaware, has to say about how Ticketfly can now help them book shows night after night:

Despite this schedule (nearly 1,000 events per year), the company's event promotions and marketing team consists of just four full time individuals. Prior to joining Ticketfly, the team was "grasping in the dark," according to box office manager Sarah Marasco, particularly when hosting a performer for the first time, heaven forbid venturing into a new genre.

This ties right into the issue of "pay for play" I wrote about last month in Pandora Isn't the Enemy, the Music Industry Is, Part 2. But, beyond that, it's about finding new ways to support the broad music industry at various levels.

Pandora can do what Ticketfly does for venues with artists to further prevent clubs from "grasping in the dark" when they book shows. Pandora is in the early stages of doing this with its artist dashboard product. But, again, it needs to step up the intensity of its game.

Pandora can create a groundswell of support for its efforts on the royalty front -- and prove that a more equitable royalty structure for digital radio can and will benefit the music industry beyond the peanuts most musicians see from royalties -- by showing not telling everybody what a great partner it can be.

We're already seeing flashes of what it can do.

This is the power of Pandora:

Pandora Presents where it packs a venue with loyal Pandora listeners and fans of Cincinnati-based Walk The Moon.
Pandora Premieres which gives listeners access to new albums one week prior to their official release, helping drive sales.

Last week I discovered Bronze Radio Return on Pandora Premieres. If you're into Mumford & Sons or the Lumineers, you'll love these guys. And, from what I can tell, Bronze Radio Return loves Pandora.

I sat with my guitar instructor last week -- he plays in a band called Freefall Rescue -- showing him his band's Pandora artist page. Full disclosure: I alerted Pandora to Freefall Rescue's new EP, which it now spins. I rarely call in favors, but I did this time because these guys deserve it and, more importantly, they have no idea how to navigate the system.

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