Selling (vs. Leasing) Exclusive Beats the Right Way

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A thoughtful conversation unfolded on BeatStars’ Twitter recently, one involving the subject of selling exclusive beats.

A producer by the name, Nick Nash Beats shouted out BeatStars on Twitter for providing him with a platform to sell his beats (you’re welcome!). Another Twitter user stirred up the conversation saying, “Please don’t tell me you sold exclusives for $250”.

Nick then responded with, “…I’ve only got 1 placement and that’s the most I’ll make off leases so what I’m [sic] supposed to do?”

We then launched a small, open investigation with our Twitter-base by fielding the following tweet:

This resulted in a lot of really interesting conversation to the point where we felt it was necessary and beneficial for everyone to speak formally on this subject in the form of this article.

Whether you’re new to making and selling beats or you’ve been doing this for years, our consumer insight and independent research will aid you in your efforts of selling beats, especially in regards to exclusives.

We already wrote about the differences between license types, so if you’re unfamiliar with what an exclusive vs. non-exclusive beat is, head here.

Getting Help with Selling Exclusive Beats

Numerous producers in the subreddit MakingHipHop – an online community/forum for aspiring hip-hop beat makers – have asked the community for help when it comes to not only selling beats, but selling exclusive beats.

At one point or another in a producer’s career (probably towards the beginning, but could happen at any time), he/she starts to wonder about selling exclusive rights to their beats.

Maybe you have sold non-exclusive beats here and there; maybe you’ve sold a lot or maybe you’ve sold none. The first part in understanding exclusive beats and how to sell them is considering when to sell them.

When (In Your Career) To Start Selling Exclusive Beats

Truth be told, there is no hardline indicator for when you should start selling exclusive beats as opposed to leasing non-exclusive rights or (gasp!) giving beats away for free.

Deciding when to start selling exclusive beats is based on many factors, including your experience, your connections, your sound, your quality, your name-recognition, and much more (this will come back up when we go over “worth” below).

If you’re well-known, have a studio-quality sound, and/or you have the credibility to back your work, you should definitely be selling exclusive instrumentals. If not, you may still consider selling exclusives.

Some would say that if you haven’t sold a non-exclusive beat, you shouldn’t even consider selling an exclusive beat. We think you should never forego the option of selling exclusives; simply factor this into your exclusive beat price.

How Much To Sell Exclusive Instrumentals For

Some users involved in our Twitter discussion had some strong points to consider when thinking about how much to sell exclusives for:

BeatStars’ CEO Abe Batshon offered his own take on selling exclusive beats. When considering how much to charge for an exclusive license, Batshon suggests looking over your catalog of beats to find out how much each one of them has sold over, say, 12 months.

Say you’re averaging a couple thousand dollars a year per beat in non-exclusive sales. Batshon suggests that this should be your starting point in determining how to set a price for an exclusive license. So if your beats are averaging $2,000 in total sales over their life span or averaging $300, then those figures should give you a realistic value for what you should sell your exclusives for at any given time in your career.

Obviously this will be more relevant for producers making that kind of money from selling beats on a yearly basis. If you’re newer and/or you haven’t sold that many beats, you’ll have to consider an alternative method to coming up with a price for your exclusive license.

Producers from MakingHipHop have varied responses to this, some saying to sell beats way cheaper than we’d recommend and some encouraging to go into the hundreds. Batshon notes how your exclusive license price will need to be cheaper the earlier you are in your career if you’re not selling beats much to begin with.

Then, when your non-exclusive beats begin to gain traction and sell more, you can use month-to-month averages to determine how much you can sell your exclusive license for based on Batshon’s recommended formula above.

You might also decide that you purposely want to overshoot your price points (sell your beat for more than you intend to actually sell it for). This opens the door up to negotiations to negotiate down towards a more fair price for both parties. This is a common tactic used in sales, so you will probably find it useful to take advantage of this practice.

Also Consider What You’re Selling

With a non-exclusive license, you’re probably selling an MP3 or a Wav that may or may not be tagged. With an exclusive license, you’ll likely need to hand over the Wav, but also the stems for the track. This carries more weight and value than an MP3 alone so that will obviously affect the price.

As you’ll see with most of this, there are a ton of variables, so don’t be afraid to test out different price points each month to determine where you’re most comfortable.

Hell, even if you’re selling exclusives for $250 – think about that for a second. How long does it take you to make a beat? An hour? Two hours? That’s over $100 an hour in some cases. Who do you know that makes $100 an hour!?

What Is Your Worth? What Is Your Buyer’s Worth?

Another thing to consider is worth, or value. One Twitter user made this interesting comment:

So how much are you worth and how much are your buyers worth? Much like our suggestions thus far, the answers to these questions are: it depends.

Your worth is a careful calculation of value-added, quality and name-recognition, among a few other factors. If you’re a newbie producer making beats with [insert cracked DAW here] who has no features or any connections, your worth (see: value) may be less than, say, a producer who’s been making beats for ten years in a professional studio.

Additionally, you must also consider your buyer’s worth. It’s common for favorability to come into play when selling beats, especially exclusives. By this, I mean if you’re “feeling” an artist or connect with an artist, you may be inclined to sell them an exclusive license and/or offer them a discount.

On the other hand, if the opposite is true and you don’t like an artist for whatever reason, you may be hesitant to sell your beat exclusively and you may decide to charge more for your production.

One Reddit user offered a salient bit of insight on this matter:

“It’s all about managing relationships. If he seems like the kind of dude who is REALLY going to benefit you with some exposure, cut him a deal and sell it to him for [X dollars].”

It’s important to consider both sides of the purchase when considering worth of the transaction. Your value is important, but so is the buyer’s.

Benefits and Considerations of Selling Exclusives Over Non-Exclusives

One of the biggest considerations of selling exclusives is the profit. Naturally, selling an exclusive beat will yield you a higher up-front profit. That is, you can sell an exclusive beat for more up front than you could with a non-exclusive.

We fully admit that some of BeatStars’ top-selling producers don’t sell exclusives. This is because their beats have a very long shelf life. Some of these producers have been selling the same beats with non-exclusive licenses for two or three years!

If you find that you make more money leasing beats, you should definitely take that into consideration when figuring out how you’ll go about selling exclusive productions.

At the end of the day…

You should really be at a point in your career when selling exclusives makes sense. If you’re beats are not up to par (there are plenty of online communities to gauge feedback, especially on Reddit, such as MakingHipHop or FutureBeatProducers or WeAreTheMusicMakers), you may need to think, “do I really need to be selling exclusives right now?” or alternatively, “will people want to buy exclusives from me right now?”

Also, this is capitalism. People are going to buy your product for what they think it’s worth. Following our guidelines, you should have a better idea of when and how much to sell your exclusive beats for, but it really just depends on each producer’s/buyer’s situation.

There’s nothing set in stone here and for good reason. Play around with it – gauge where you are in your career and where you are musically, consider your added value, consider how much you think your product is worth, consider your market and how much your potential customers can and are willing to spend, the list goes on and on.

All these variables and more are likely to come into play when selling exclusives, but the important thing to remember is you are the creator so the ball is in your court. You just need to learn how to play the game the buyer’s are playing, too.

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