Mick Jagger, Profit Maximizer

Today is the birth date of Michael Philip Jagger, known to the world as Mick. As true fans know, Jagger isn’t just the long-tenured front man of the Rolling Stones; he was also a student of finance and accounting at the London School of Economics.

He did not graduate from LSE, however; he attended for just a short time. I have read that he was asked to leave after riding a motorcycle through the library, but I doubt this is true — not just because it seems very unlikely, but because Jagger has never been as wild as his image. I mean this as a compliment.

Notwithstanding his short tenure at LSE, I do believe that Jagger is supremely smart when it comes to running a business. And that is what the Rolling Stones have primarily been for the past 20 or 30 years: a business, and a very well-run one. I have always thought that Jagger’s talents as CEO were overlooked — which probably suits him just fine, considering that when you are a rock singer, there’s some significant value in seeming more reckless and wild than a typical CEO.

The smartest thing about the Rolling Stones under Jagger’s leadership is the band’s workmanlike, corporate approach to touring. The economics of pop music include two main revenue streams: record sales and touring profits. Record sales are a) unpredictable; and b) divided up among many parties. If you learn how to tour efficiently, meanwhile, the profits — including not only ticket sales but also corporate sponsorship, t-shirt sales, etc., — can be staggering. You can essentially control how much you earn by adding more dates, whereas it’s hard to control how many records you sell.

The other thing about touring that’s nice for a band like the Rolling Stones is that it gives the non-songwriters a chance to make some real money. I’m sure that Charlie Watts, Bill Wyman, and Ronnie Wood made nice money from record sales over the years, but probably a lot less than you’d think. Jagger and Keith Richards, meanwhile, earn a lot more because they also earn a songwriting royalty. I have no idea whether Jagger pays Watts, e.g., as much as he pays himself for touring, but if one mark of a good CEO is providing an opportunity for everyone in the company to prosper, then Jagger is indeed a pretty good CEO.


FreeMarketSociety

I'd have to say the best business decision(s) made by the Stones was to start promoting every year as the "last tour".
The most cost efficient way to be able to jack prices up another 20% is to scare your faithful into believing this year might be the last year they are coming to a town near them.

SheMuses

Is money his true mistress? Wonder if it has the long legs he craves? Shame that art is a business for him, takes some of the joy out of it.

majikthise

Seems like this entire post was speculative. Any data to back up *any* of the claims made here?

chazza

Mick has always been regarded as the shrewd one (from all the books I've read over the years), and he and Charlie were typically the most involved of the band in the tour planning.

Among the smartest moves Mick made (post-Andrew Loog Oldham) was bringing aboard Prince Rupert Lowenstein as an advisor, and tour manager Michael Cohl. (As for Allen Klein . . . )

Fortune did a little piece a few years ago at:

http://findarticles.com/p/articles/mi_m0EIN/is_2002_Sept_17/ai_91656712/print

lermit

And he hired himself to be the CEO. He is a very smart guy in business too!

.lermit

u01mcw

Another great post!

There are many stories about Jagger's business acumen but my favourite has always been this exchange between Jagger and David Geffen:

Geffen found Mick Jagger at the hotel, nervously introduced himself, and told him he would like to book the Stones upcoming tour.

"What is it you really want?" Geffen asked.
"Well, we want to play smaller places for more money" Jagger told Geffen.

"Oh, terrific, "Geffen said, rolling his eyes. " How do you to propose to do that?"

Jagger told Geffen that they thought they could find a corporate sponsor such as Coca Cola to undewrite the tour. In exchange, the Stones would give Coke a plug from their stage during their concerts.

When Geffen told him he did not think that Coke would agree to sponsor such a controversial act such as the Stones, Jagger brushed him aside. "That's the trouble with you, Geffen - you're so negative!"

This all happened in 1971.

Hat-tip - The Operator by Tom King

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frankenduf

this post strangely resembles the Twain posts- the artist as clandestine tycoon- I kinda lean toward majikthise- these may be chicken/egg posts- is the success inevitable from the artistic success, or is it a seperate dynamic

srichman

Jagger was once on Saturday Night Live doing a guest spot on the "Wayne's World" local cable access show. While boring the boys with an hours-long economics lecture (they immediately fell asleep), he mentioned F. A. Hayek's name. I wonder if he ad libbed that. Surely, he was more likely to have known about Hayek than the scriptwriters were.

FreshPeel

The music business is just that, a business. But that shouldn't take the art expression out of the music. Mick has shown us by example that business, art, and creativity can and should coexist.

Fateful Endeavors

Another musician/CEO who should be recognized is Gene Simmons of KISS. Not only has he run the band as a business, but he is one of only a few people in the music industry to understand the importance of brand image. KISS isn't great musically, but Gene Simmons created an image and turned that image into a brand. Think of all the things over the years that have been brandished with the KISS image. Now, can you recall similar items branded with the Rolling Stones or Madonna (the singer, not the MOJ)brand?

egretman

The only twisted puzzle here is how the Jaggerman has managed not to blow his brains and body into the Ozzie like state of hapless disconnected neurons of drug induced happyville or into a depressive state of self-loathing Cobainish darkness from the spirit numbing rote playing of the same songs over and over and over as do all other real rock stars.

Come to think of it, why hasn't he died in a small plane crash as have all other truly great rock stars?

asparagus

Egretman, I have read that Jagger is obsessive about his diet and workout routines. He knows he has to be in top form or the value of the asset falls.

I think he has always stood at the edge of the business, surveying it from the outside, carefully planning strategy.

ycagwyw

FreeMarketSociety said:
>the best business decision made by the Stones >was to start promoting every year as the “last >tour”.

They have NEVER done that. At the start of each tour, they're always asked if it's the last and the answer is ... it's the last one until the next one.

levi from queens

A friend of mine had the same adviser at London School of Economics as Mick Jagger. My friend tells me that his adviser said that Mick Jagger did a careful net present value analysis of the value in attending LSE as compared to the foregone revenue from playing rock and roll. When the dollars came out higher for music, Mick came by and apologized to the adviser, but said he couldn't afford to continue in school --LSE was just costing him too much money.

Megaforce

Conversely, some bands would use touring as an opportunity to further the income gulf between main performer and supporting cast. The main guys in the Ramones, according to what I heard, used to pay some of the other permanent band members just a couple of hundred bucks a week to tour, it was a take-it-or-leave it situation.

Harborchicklet

Mick Jagger has a long and accomplished work record--talent. I would prefer he stuck to what matters the music instead of concentating on being all thing to all people- another words capturing every target market. His contracted model-wives his allegeded children- ehhhh - not
beliveable - not the marrying type. Great performer though.

nic

levi from queens:

Your anecdote, while amusing, is directly at odds with what Jagger says in the interview. If you'd read the linked article, you would have found this quote from Jagger:

"When we first started out, there wasn't really any money in rock & roll," says Jagger. "There wasn't a touring industry; it didn't even exist. Obviously there was somebody maybe who made money, but it certainly wasn't the act. Basically, even if you were very successful, you got paid nothing."

Basically the gist of the article is that the Stones made not much money till the Steel Wheels tour in '89.

So either Mick Jagger is lying to the reporter in the article, or somewhere in the chain of Jagger telling his adviser, telling your friend, telling you, something got mixed up.

FreeMarketSociety

I'd have to say the best business decision(s) made by the Stones was to start promoting every year as the "last tour".
The most cost efficient way to be able to jack prices up another 20% is to scare your faithful into believing this year might be the last year they are coming to a town near them.

SheMuses

Is money his true mistress? Wonder if it has the long legs he craves? Shame that art is a business for him, takes some of the joy out of it.

majikthise

Seems like this entire post was speculative. Any data to back up *any* of the claims made here?