The Economics of a One-Hit Wonder
The Knack. Soft Cell. Dexys Midnight Runners. Any of those bands sound familiar?
Welcome to the world of one-hit wonders, where you can release a song like “My Sharona” (The Knack), “Tainted Love” (Soft Cell), or “Come on Eileen” (Dexys Midnight Runners) and still miss out on becoming a household name. As someone who’s dabbled in the musical arts, I’ve often wondered how much money you could earn with one hit song. Just one. Would you be financially set for life? Or, after the record label people got their cut and all the other costs were accounted for, would the remaining profits be too slim to allow for early retirement (assuming that’s what you wanted)?
The answer, I discovered, is that it depends. But before I dive into the reasons behind why it depends, let me first establish that the notion of an artist earning millions off of one hit song isn’t some music industry myth. It’s happened before. And actually, it’s still happening now.
Legend has it that The Knack’s lead guitarist, Berton Averre, and lead singer, Doug Fieger, wrote the 1979 mega-hit “My Sharona” in just 15 minutes. They mixed it in just 15 minutes as well, after recording the majority of the song — including lead vocals — in a single take.
That hastily put-together song would go on to sell a half-million copies in 13 days, making it the fastest debut single to earn Gold status since The Beatles’ “I Want to Hold Your Hand” back in 1964. What’s more, “My Sharona” claimed the top spot on the Billboard Hot 100 chart for six weeks straight, and was named Billboard’s #1 song of 1979.
While The Knack did technically produce some other “hits” (i.e., songs that made it onto the charts) in the years to follow, none of those songs ever became remotely as popular or commercially successful as “My Sharona.” The Music Gods seemed to have made up their minds back in 1979: The Knack would have a massive hit, but only one.
In the end, that’s really all they needed.
“[‘My Sharona’] is far and away the major part of my income stream, and somehow it just keeps going strong. Recent years have been the best we’ve had since our salad days.” That was Berton Averre sounding pretty chipper about his financial situation in an interview back in 2011. To this day, Averre is living comfortably off the proceeds of The Knack’s 1979 hit. (His “My Sharona” co-writer, Doug Fieger, passed away in 2010, but Fieger’s estate is undoubtedly still collecting his share of the earnings.) While the precise dollar amounts involved here are unknown, the broader takeaway is that a single hit song, written and recorded 30+ years ago, is still generating income. How the heck does that happen?
The Economics of a One-Hit Wonder
Record sales. That’s what the music industry is all about, right? Gold records (500 thousand units sold), Platinum records (1 million units sold), and even Diamond records (10 million units sold). According to the BBC, “My Sharona” — the single — has reached the 10-million-unit threshold.
The album it appeared on, meanwhile (“Get the Knack”), has sold 6 million units to date. Clearly, record sales have helped fill The Knack’s coffers. But record sales alone can’t account for the revenue stream Averre is currently enjoying. Too much of that money gets siphoned off to cover production costs, and promotion costs, and distribution costs. By one estimate, artists typically end up yielding just 6.6% of their records sales. And if you’re in a four-person band — like Averre was in — that means you split that 6.6% four ways. (Hold please.) That’s 1.65% each.
Of course, the fact that The Knack recorded their debut album in 11 days for just $17
thousand helped them maximize their returns. And live performances of “My Sharona” also added to the respective war chests of the band’s four members. But the reason why Averre can sit at home and collect checks today isn’t because he’s one of the recording artists behind “My Sharona,” or because he’s one of the musicians who regularly played “My Sharona” on stage — it’s because he’s one of the writers of “My Sharona.”
If you’re going to be a one-hit wonder, writing the hit is by far the best way to make a bunch money off of it.
For starters, writers get an extra cut of the record sales (estimated at 4.5%). But also, as I
explained once before in a story about music publishing, the writers of a song start out owning 100% of the licensing rights. Then they’ll typically hand over half to a publishing company and in return that company will work on getting their song in as many movies, TV shows, and advertising campaigns as possible. And when you consider that advertisers can dole out as much as $200 thousand to use a song for a year, it’s easy to understand how songwriters can end up making big bucks.
For Averre, who co-wrote “My Sharona,” a $200 thousand deal would mean $50 thousand in the bank (assuming 50% is going to the publishing company and Averre and Fieger’s estate are splitting the other 50%). Repeat this process a few times a year, every year, and ... shit. You can absolutely retire off of a one hit wonder.
The tricky part, no doubt, is writing that hit song — a song that isn’t just popular when it’s released, but that’s able to stay relevant across future decades. “My Sharona” is perhaps the best example of a song that was able to accomplish this.
In 1994, for example, the song featured prominently in the Ben Stiller-directed comedy/drama, Reality Bites. In addition to introducing the song to a new generation of eardrums, the film launched “My Sharona” back onto the Billboard Hot 100. However, as Averre revealed in a 2015 interview, it’s not like his “My Sharona” revenue stream was really suffering before that. “Getting that song on a soundtrack, it really wasn’t that big of a deal. ‘My Sharona’ had already appeared all over the place, on hundreds of compilations around the world ...” To be fair, Averre did go on to acknowledge that the extra exposure “My Sharona” received from Reality Bites helped encourage The Knack to reunite. They played more shows, got back in the studio for more albums, and, of course, these activities helped make everybody in the band more money — the live shows especially.
According to Pierre Bradshaw, who worked 6 years at MCA/Universal Music, a band with a hit song can bring in anywhere from $10 thousand to $50 thousand per performance. And the actual members of the band get to keep around 85% to 90% of that. (Their manager usually gets a 10% to 15% cut.) So if you’re a one-hit wonder who didn’t actually write your hit, playing a ton of live shows is probably your best bet at striking it rich. Selling t-shirts and other merchandise at your shows could be another important revenue stream. And if you’re somehow able to use your hit song to become Beyonce-level famous, endorsing products or launching a clothing line could be the key to your early retirement.
Of course, there’s no guarantee any of that will actually happen.
According to income research from Northwestern University law professor Peter DiCola, the bottom 99% of working musicians earns — on average — 10% or less of their income from songwriting royalties. The top 1%, meanwhile, earns an average of nearly 30% of their income from songwriting royalties. And that 30% represents the biggest chunk of a 1-percenter’s income pie.
For the bottom 50% of working musicians, playing live is the largest revenue stream. And across all income brackets, it’s common for musicians to earn additional income through teaching and doing session work. And hey, that’s the reality of being a working musician: You usually have to, you know, work to make money.
Averre is a special case. He was able to write a song that became so culturally ubiquitous and commercially attractive that — after recording it — he didn’t necessarily have to work very hard in order to financially benefit from it. The cash just came rolling in. And it’s still rolling in. Averre summed it up nicely in an interview last year:
“I’m lucky. When people say, ‘What do you do for a living?’ I say, ‘I go to my mailbox a couple times a month.’ That song has been so good to me.”