Roughly the same time we published our video on how technology is changing the music industry, Forbes released its 2015 list of highest-paid celebrities featuring Katy Perry at the #3 spot, with earnings of $135 million over the past 12 months. This is significantly more – almost 70% more – than her rival, Taylor Swift, who earned $80 million over the same period. The only two celebrities who outearned Perry were boxers Floyd Mayweather and Manny Pacquiao.
Unsurprisingly, touring was a major contributor to her success, with earnings from outside North America accounting for 60% of her income. Moreover, Perry averaged $20 per head per night on merchandise sales during the tour – four times the industry average.
Notably, and unlike Swift, Perry has not resisted streaming music, stating the “the record is that launching pad for all kinds of other creative branches.”
It appears that Perry is successfully adapting to the ongoing disruption in the media industry. Rather than actively resist change, which we have argued will only push consumers further into other platforms such as streaming and even piracy, she has used media as launching pad for her own personal brand, playing 124 shows over 27 different countries and four continents over the past 12 months, while making money from touring, merchandise and sponsorship.
In short, Perry has successfully positioned herself as a celebrity for the 21st century. In the age of the Internet, consumers demand accessibility and Perry has been providing that accessibility, whether through the Internet with streaming music, or in person with frequent touring around the world.
Ramon Rodrigo Cuenca, CFA
Art and Finance