Merchandising is the term used to describe products that advertise another product. Since music is being used in more places than ever before these days, record companies use merchandising on a regular basis to create a ‘Brand Interest’, raising public awareness about a new artist or the latest release.
The creators of musical work licenses or offer the rights to produce and merchandise musical work to the purchaser or manufacturer. A purchaser of recorded music owns the media on which the music is stored, but not the music itself. The purchaser has limited right to use and reproduce the recorded work. The owner of the musical work gets an amount as royalty and an advance payment as fees from the purchaser. Music merchandising is a fundamental source of promotion, advertising and income to cover some of music producers’ expenses. The key points on the contract between the owner of the musical work and the purchaser will be the terms (period), territory, advances, and royalties including the right to use his/her artwork.