Taylor Swift: Musician – Excellent; Businesswoman – Par Excellence
The pop phenomenon is doing a lot of smart things; everything seems right and is generating a tonne of money.
Singapore had Taylor Swift.
Ticket costs range from $328 to $500 (not including fees) for a single day’s worth of performances, given that each show lasts three and a half hours and has forty-five songs. The city-state is experiencing an extraordinary economic boom because of the event, which has sold over 300,000 tickets and generated a lot of publicity.
Since Singapore is the sole Asian destination for Swift’s tour, the city-state received a subsidy from the Singapore Tourism Board of up to $3 million per performance.
Reservations for Singapore-related activities from March 1–9 (the concert period) were 275% higher than reservations for a comparable period from March 15–23 (two weeks later), according to data from travel platform Trip.com. Hotel reservations for the week of March 1–9 are 462% higher and incoming flight reservations for Singapore are 186% higher than those for March 15–23.
Travel arrangements for Swifties to Singapore have already been made. The renowned Marina Bay Sands resort offered three opulent packages: Stay Stay Stay, Shake It Off, and Wildest Dreams. The names of the packages were taken from Swift’s songs. The beginning prices for the packages were S$10,000, US$7,400, S$15,000, and S$37,100, respectively. They ran out of packages.
Swifties’ Eras spending includes new performance attire, tour merchandise, and craft materials for friendship bracelets that fans exchange.
Maybank believes that the Eras Tour will have produced tourist revenues alone of S$350-500 million, or US$260-372 million, by the time throats are sore and the glitter has washed off. That is predicated on the idea that over 70% of participants would travel internationally to Singapore.
Even before the United Overseas Bank (UOB) conducted the July ticket pre-sale for cardholders, Taylor Swift had an impact on the city-state in 2023. UOB reported a “very significant surge” in UOB card application volumes throughout Southeast Asia of 45% after the announcement on June 21. In the week leading up to the announcement, UOB saw a 45% rise in daily average credit card applications throughout Vietnam, Singapore, Malaysia, Thailand, and Indonesia compared to the previous weeks in June. According to the bank, there was also a roughly 130% increase in debit card applications in Vietnam and Singapore.
The American pop star’s unprecedented financial clout was on full display in the third quarter when credit card fees for the third-largest Singaporean bank reached all-time highs because of Taylor Swift’s partnership with the bank.
On Thursday, UOB announced record quarterly fees of $104 million from its credit card business, an increase of 89% year-over-year, as the lender claimed an increased profit. Nearly 20% of net fee revenue in the quarter came from card fees, down from over 10% in the same period of 2022.
Half of the new bank customers were female, and over a third were in the age bracket of 20–29. Due to the overwhelming success of this tactic, UOB intends to keep forming such collaborations; for example, it has partnered with Ed Sheeran. In all five nations, those in the 30–40 age bracket made up more than a third of the new cardholders, with those in the 20–30 age bracket coming in second, at almost 32%.
The Astute Businesswoman
Swift is an exceptionally clever entrepreneur, and her success as a musician is undeniable. Aside from her appealing music, she has amassed a vast business empire via daring manoeuvres and smart alliances.
Swift went from being a singer to a business magnate, so let’s take a look at her most important business moves:
Streaming Royalty Renegotiation
Swift openly denounced Spotify’s pitiful streaming royalties in 2014, when she removed her entire catalogue from the platform. Fair recompense for artists was a topic of contention after her transfer.
Swift bargained for a groundbreaking arrangement after Apple introduced Apple Music. Apple established a new norm in the business when it decided to pay royalties during their free trial periods.
She reportedly inked a $300 million contract with Universal Music Group in 2018, after departing from Big Machine Records. She was the highest-paid performer at the time because of this.
Swift continued to show off her superstardom in 2021 by licencing her recordings to streaming services via her partnership with Universal Music Group. Considering her commercial supremacy, Swift probably negotiated greater royalty payments, although the details are hidden.
Swift secured an extraordinary streaming arrangement for thousands of other singer-songwriters on the UMG label while simultaneously locking down a hugely lucrative record contract with Republic Records, a division of Universal Music Group.
As part of Swift’s new deal, UMG is bound to redistribute and not recuperate any funds from the sale of UMG shares in Spotify—which went public in April. One estimate puts UMG’s 3.5% stake in Spotify worth $1 billion.
Swift has defined more equitable streaming economics for artists like herself through her ardent advocacy.
Revenue-Generating Tours
Swift’s massive and lucrative live performances are legendary.
Worldwide, her Eras Tour has made more than $1 billion. Guinness World Records has certified that this tour has earned more than $1 billion, making it the highest-grossing music tour of all time. This exceeds the Rolling Stones’ previous record of $733 million.
Swift made the most of her hustle by maximising her product and TV partnerships. Her concert tour was filmed live and shown in AMC theatres thanks to her partnership with the theatre chain. At $93 million worldwide, The Eras Tour was the highest-grossing music event film of all time.
During her concerts, Swift offers high-margin items like autographed guitars, phone cases, and VIP packages. Swift has turned her live performances into her most profitable business venture.
In terms of box office receipts, Taylor Swift’s concert movie Era has outperformed all other concert and documentary movies.
According to AMC Theatres Distribution and AMC Entertainment, the film has earned over $261.6 million at the box office worldwide, surpassing all previous concert films and documentaries,
The previous record-holder was 2009’s This Is It, starring Michael Jackson, with $261.2 million.
The picture opened to a tremendous reception in the United States on December 31, 2023, and it maintained its triumph last week with a $8.7 million premiere in China.
Master Recordings
To get her hands on the master recordings again, Swift started re-recording her first six albums in November 2020.
Record companies hold the original recordings in perpetuity; they are called masters. Swift’s new masters aimed to diminish the value of the originals that her previous label held.
In April of 2021, Swift started releasing her songs that had been rerecorded. However, 2019 was the starting point for the whole process. At that moment, word got out that Scooter Braun had bought Swift’s previous record company, Big Machine Records, which she quit in 2018. After the transaction, Braun became the legal owner of all of Swift’s previous master recordings. This meant that anybody wishing to use one of Swift’s songs in a film, TV programme, or commercial would have to approach Braun for permission and pay a licencing charge. Swift was even more hurt since Braun had worked with Kanye West, her archenemy. She referred to the news as “my worst-case scenario” in a heartfelt Tumblr post.
To get around Braun, Swift intended to rerecord all of the songs from her earlier albums—those released before her 2019 album Lover—
Swift agreed to hold the master rights to all of her future songs when she signed with Republic Records in the autumn of 2018. So, she will have full ownership of the new records as she rerecorded her old songbook with Republic Records. As a result, licensees would no longer have to go through Braun but may instead collaborate with Swift and her team directly. Therefore, Swift would be able to regain some control over her music and its use.
This risky move yielded enormous rewards. Both of Swift’s cover versions of “Fearless” and “Red” reached number one, surpassing the originals in sales.
Now that she has these re-recorded master rights, Swift may finally cash in on her early singles. Through syncs and licencing, old albums may produce revenues again. It restored artists’ control over their careers and financial success.
Real Estate
Swift has amassed her money via a combination of her music assets and her real estate investments. Her real estate holdings include mansions in four major cities: New York, Rhode Island, Nashville, and Los Angeles, with a combined value of nearly $100 million.
Moreover, Swift increased the value of her $6.5 million Beverly Hills estate—which she purchased in 2015—by designating it as a historic monument, resulting in a tax savings of millions of dollars. The many properties that make up her real estate business have produced remarkable results.
Brand Partnerships
Swift has selected lucrative brand agreements that are in line with her public image as a top celebrity ambassador.
Reportedly, she made $26 million during her ten-year endorsement deal with Diet Coke. Keds, AT&T, Apple, and Target were among her long-term endorsement arrangements.
Swift has just teamed up with Peloton for a themed exercise programme. The publication of her album Midnights caused an upsurge in her engagement on Spotify and Amazon.
Swift is careful with her sponsorships, ensuring that they provide significant value to her partners rather than overwhelming her brand.
Persona and Legal Rights
Swift is zealously protective of musical rights, trademarks, and brand loyalty. She went after businesses for selling her songs without her permission and even went after Justin Bieber and a Utah theme park.
Swift, who had previously been a vocal supporter of artists’ rights, made sure that her arrangement with Universal included ownership of all future masters.
By tenaciously defending her songs and reputation, Swift maintains complete control over her revenues and catalogue.
Direct Bonds With Fans
Swift’s tight bond with her devoted following is the glue that holds her business together. She keeps in touch with her followers through: • Regular social media engagement; • Private listening sessions of new albums; • Personalised item gifts • Party invitations etc
Because of this sincere effort, the hero continues to have a legion of devoted fans who proudly shell out cash for records, tickets, and merchandise. Swift’s affinity with her audience is her greatest strength.
The Final Analysis
Swift’s commercial savvy is on par with her creative abilities. Her empire is an example of what is possible when creative thinking and business acumen come together. If you want to know how to turn your musical success into commercial supremacy, look no further than her. And she is young!
Reference
https://www.untaylored.com/post/the-business-model-and-revenue-streams-of-taylor-swift-explained
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