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Some more Statistics

As I just wrote about curves and graphs, I’d like to use the opportunity to introduce you to some more mathematical stuff that may be important to you later on.

If you want to understand how things evolve, then you need to know about BELL CURVES and the 80–20 RULE.

A bell curve is a symmetric bell-shaped graph that’s the result of a so-called Gaussian function, named after German mathematician Carl Friedrich Gauss (1777-1855). Gaussian functions appear in many contexts in natural sciences, social sciences, mathematics, and engineering. You should have seen bell curves when working with EQs already, and you may also know the Gaussian Blur filter if you’re working with Adobe Photoshop for example. The following image shows a typical bell curve, with the peak at the top centre:

The so-called "bell curve" (or "Gaussian distribution") represents many natural distributions in nature and society.

Gaussian functions are widely used in statistics where they describe the normal distributions, and this is where they also become relevant is various business areas, including the music business. Bell curves may also correctly describe the distribution of your audience and album buyers for example. A bell curve even describes the distribution of intelligence within the population.

If you want to make good music, then you’ll probably find your typical audience rather within the 20% of the population that’s more intelligent, or that’s performing better in school, or even in life. The following curve shows the area that makes up those 20%:

20% of the population are so-called "high performers".

This leads us to the “80–20 rule” (officially known as the “Pareto principle”, sometimes also called “the law of the vital few”), which states that roughly 80% of the effects come from 20% of the causes.

It is the result of a power law distribution (the Pareto distribution), it was introduced by consultant Joseph M. Juran (1904-2008), and it’s named after italian economist Vilfredo Pareto (1848-1923).

The 80-20 rule is a common “rule of thumb” that will help you to understand how things work in business, society, nature, and in common life.

It will also help you to quickly make good estimations as well as to take quick decisions. Here are some examples:

  • 80% of the land is owned by 20% of the population.
  • 80% of all wealth is owned by 20% of the population.
  • 80% of profits come from 20% of all customers.
  • 80% of complaints come from 20% of all customers.
  • 80% of profits come from 20% of development resources.
  • 80% of sales come from 20% of all products.
  • 80% of sales are made by 20% of the sales staff.

Quite interesting facts, right? And you will find those distribution rules everywhere, in all businesses, in nature, and in all aspects of life. When it comes to the music industry, then the following will be important for you:

  • 20% of the population is listening to good music, 80% of the population is listening to bad music.
  • Which means that 20% of the population may buy your music if you make good music.
  • 20% of the population typically buys albums (music lovers), while 80% are single buyers (pure consumers who just want to be entertained).
  • 20% of the population are responsible for 80% of the music industry’s profit.

The music industry is focusing on the masses, that’s the 80% of the population that don’t care about art and thus only generate low sales.

Our strategy in this manual will be to do exactly the opposite:

You will be focusing on music lovers, on those 20% that are interested in art and that are supporting real artists.

Those are the 20% that really care, those are the 20% that will be buying albums. As seen before, those are the people who would potentially generate most income in this business, if record companies would offer them something they could actually buy.

The music industry is ignoring that population, so they’re yours.

20% of the population are also so-called high-performers, which means that they do much more in life than the rest of the population, and this also explains those rather surprising numbers. High-performers are usually leaders, while most followers will be low-performers.

If you want to become successful as a musician, then you should be part of the more productive 20% of the population too – if you’re a low-performer, then you may forget about it right away.

This also means that only 20% of the population will be relevant to you if you want to kick off a successful career, and you may save a lot of time and money if you focus your energy on those who may actually like or even buy your music.

The same is true when working with people, focus on the 20% that will really help you to evolve. The following image visualises the power law and the resulting distribution:

20% of all causes are responsible for 80% of all outcomes.

Here are some more interesting facts when it comes to producing your album later on:

  • When writing your songs, you will be spending 80% of your time working on 20% of them.
  • When recording your album, you will need 80% of your time to solve 20% of your problems.
  • When promotion your album, 20% of your actions will be responsible for 80% of your success.
  • 80% of your actions will have little to no effect.

Such lists could go on like that forever, but at this point I just want you to understand the basic principles behind the 80-20 rule. You will hear about it a few more times in this manual and it will be a great tool for you to make good estimations in future. The most important thing to remember will be that you will have to stay focused on those elements that will really help you on your road to success.

Focus on those things that will really make a difference, and forget about all of those little details that won’t be of any interest anyway. The 80-20 rule explains why most people fail, and it will help you to focus on those things that will ultimately lead to success.

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Chapter 2.5   •   Page 4 of 6

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