Lady Gaga Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

About Lady Gaga

Lady Gaga was born in America in 1986 and her original name is Germanotta. She started to play piano at the age of 4. Piano balled was composed by her when she was 13 years old. She participated in many musical events at school. She was among those 20 students who got a chance to study at New York University’s art school. She wrote songs as well. Lady Gaga was introduced in the music industry by Herbert. Herbert was known for introducing new talent and Carter was introduced to Lady Gaga by Herbert. Herbert recommended Carter as her manager.

Lady Gaga has become one of the most popular singers in pop music. She has large number of fans on social networking sites. She knows how to promote herself on social media and how to make strong relations with her fans. Therefore, she has strong relations with her fans. She personally controls her social media accounts specially Twitter. She is also known for her unique presence. She has positioned herself as fashion icon and she has a unique sense of style.

Music Industry

Music industry is a billion dollar industry. There are two sources of income in the music industry. One source is recorded music and the second source is live music. Recorded music consists of albums and individual songs; however, live music is based on concerts. Recorded music was $8 billion dollar industry in the United States of America and Digital sales had $1.6 billion market.

Revenues from recorded music fell from $15 billion in 1999 to $8 billion in 2008 (See Fig-1 in the appendix). It was expected that sales would continue to decline; however, sales of live concerts had increased. It had increased from $1.5 billion in 1999 to $4 billion in 2008 (See Fig. 2 in the appendix). Apple’s and Amazon were leading digital outlet market.

Singers were motivated to have a contract with label companies for usually 4-6 albums. Label companies were then responsible to make new albums and promote them. Popular singers were given $1 million dollar or more when the contract was signed. Less popular singers were given $200,000 - $300,000. Singers were supposed to get 15%-20% loyalties if all expenses were recovered by label companies. There were four large music recording companies that had 90% share of the market.

There were promoters who provided their services in arranging concerts. Two promoters were leading the market and these were Live Nation and AEG. Different deals were offered to singers according to their popularity. Promoters and agents were able to minimize risk by arranging many concerts on different dates on the same location. There was an important role of agents in the music industry. They charged commission on behalf of their efforts.

Case Background

Troy Carter, who was the manager of Lady Gaga, called a meeting. The meeting was called when Kanye West cancelled his tour with Lady Gaga. There was a music award function of MTV. At that award function, Kanye West showed unethical behavior that caused him to cancel that event.

Gaga was an inexperienced singer. That tour was very important for her career. “The Fame” was her only album that was launched. Three songs from that album got music lovers’ attention and were hit songs.

The Fame Kill was the name of the tour. It was promoted by Live Nation and Geiger. It was decided that the tour would consisted of three months in North America. Tour schedule was announced and tickets were up for sale.

Carter knew that the concert was very important for Gaga’s future. Although, risks were associated with that concert but it was the best opportunity for Gaga to attract new fans and make money. If she cancelled the tour, then it would damage the reputation of her upcoming album “The Fame Monster” and it would have a negative impact on the revenue of this album. Streamline Records was Gaga’s official label partner, who was the part of Universal.

1. If you were Troy Carter, which of the three touring options would you pursue for Lady Gaga? Why?

When Kanye West announced his separation from The Fame Kill tour, Carter had three options to choose from. Any of these options would decide the path of Gaga’s career. Following were the three options.

Continue with the arena tour, but go alone
Develop a smaller theater tour and adjust
Cancel any tour plan

If I was Troy Carter, then I would choose the first option which was “continue with the arena tour, but go alone”. Although, the first option has the highest risk among all listed options but return will also be higher. Therefore higher the risk; higher the return rule applies here. It is because Lady Gaga was at the peak in the music industry; therefore, everybody was talking about her. Her first album had three songs. Poker face .........................

This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution.