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The Costs of an Out-Dated Business Model

written by Maggie Sale Ostara, PhD

TinaMaliaLast Saturday night I had the pleasure of attending the Tina Malia concert in Marin, California.  Malia enchants with the haunting voice of a provocative angel.  The hall sold out, filled with an adoring crowd of fans.  Obviously pleased with the turnout, Malia thanked her promoter several times, acknowledging and appreciating his certainty that they would “sell-out”, as if she were surprised.

Even though I was happy that she was pleased, I left the hall thinking:  what a lost opportunity, and what an out-dated business model.

Here’s how it goes:

  • The promoter works hard to make sure that everyone knows the concert is happening, and well positions the event as a “CD Release Party” even though the CD had actually been released last year (clever).
  • The hall holds 315 people.  General admission tickets at $20, and VIP tickets are $40 and include a CD and access to an after party with the musicians.  Let’s say 40% of the tickets were VIP tickets (there were a lot).  That makes total revenue about $9,500.
  • Let’s say the promoter spends $1000 on advertising (unless he gets it donated—I can’t tell that part—but that’s not a sustainable model anyway).
  • Renting the hall costs $600 (again unless its donated)
  • There are at least six people working as ushers and “manning” the tables at break—many of these could be volunteers (which is common for performances).
  • Figure costs for staff, after-party, graphic design, CDs, etc., conservatively at $500 (unless a lot was donated).
  • There are two bands, one with two people, and then Malia’s with three members in addition to herself.  And then there’s the promoter.
  • Figuring costs conservatively at $2100, that leaves a “profit” of $7,900 for both bands and the promoter. 

That is not very much for all the effort of filling the event. At least not from my point of view.  Given their point of view, they were probably pleased with the results, because that’s as good as you can expect from this kind of a business model.

Now of course the purpose of the event was to promote Malia’s work over all, as well as to make revenue on this particular venture.  Sure.  And it brought her fans together.

What it didn’t do, was give us a way to turn us into a tribe—in the sense that we could develop our relationships further either with Malia or each other (even though a large percentage of us already knew each other).   We felt great being together and loving her that night—but there’s no way for us to stay in touch.  And turning us from fans into a tribe is one of the key things that would shift this model, and make everything Malia does more sustainable, more satisfying to us (the fans/tribe), and ultimately more profitable for her (which would make her fans/tribe happy).

Malia also didn’t give us a next step.  Once you were at the concert, there was nothing else to buy, except CDs, which most of us already have.  There weren’t any concessions (which is a huge money maker for events of this kind), and people were dying to buy even a bottle of water!

There wasn’t even a way to give Malia more money.  There was no way to build on the energy of the concert.
Glad you had a good time, folks, good night.

This is what I call “the firework effect”:  big build up, amazing climatic event, dropping away to nothing.  This is the typical workshop, seminar, or event model in the healing arts, transformational fields—and music industry.

~ > What they lacked was a high value offering.

What if they had given us an opportunity to spend a day with Malia, for a limited number of people, doing almost anything really?

When you’ve got people that engaged with you already, it wouldn’t take much.  She could tell us her story, her challenges and triumphs of being a singer-song writer.  She could sing for us.  She could talk about or otherwise engage us on creativity, or “waking up” (a theme of her lastest album).  She could even have other people work with her doing some creative expressive work, and she could be there to contribute and sing and whatever else suits her.  An intimate day with Tina Malia, for 20 people, $500 each.  Among those 500 people there would have been 20 who would have said yes to this.  I would have.  And I would have bought a ticket for my daughter, too.

That’s another ten grand, for one day, sold at this event without additional promotion.  Double the profits (virtually) on the spot.

This is just the most simple, straightforward thing they could have offered.  There could have been any one of many other options, including a retreat, a class or seminar, even a video collection of unreleased work of hers along with a never-before released interview with her priced at $100.

I know, I know, this isn’t part of their business model.  My point precisely.

She did a great job of stirring up my hunger, and people were eating out of her hand.  But other than hearing her sing that night, there wasn’t anything else to eat.

  • Are you giving your people more to eat?
  • Are you helping them become a tribe?
  • How can you update your business model, so that you give your people what they want, charge them for it, and leave them happier than they came?

Maggie Sale Ostara, PhD left her prestigious job as the Director of Women’s a Gender Studies at Columbia University when she realized she’s not built to work for anyone else. Since then, Dr. Ostara has become a Certified Human Design Specialist (Level 4), a Certified Clarity Breathwork Practitioner, a highly sought after teacher-mentor, who teaches high-achieving women how to develop their personal sovereignty, to activate their super powers, and to unleash themselves from society’s prescription of success.

She’s the creator of the Soul Signature Self Awareness Project, the Wheel of Power of the Visionary Entrepreneur, and over 20 educational programs focused building soul-inspired businesses that positively impact the world and taking command of your life through personal sovereignty. She’s hosted 5 multi-speaker online conferences, and spoken on over 15 such conferences reaching audiences of over 200,000 participants.

With two decades of experience supporting 20,000+ students and hundreds of clients through her online programs and conferences, Dr. Ostara teaches how to avoid overwhelm and burnout, how to make reliable decisions, how to create a bigger impact with less effort, and how to transform inner liabilities into powerful assets and allies.