Lumineers' success hasn't changed label's formula

• Dualtone releases have received 17 Grammy nominations
• Lumineers runaway success hasn%27t changed label%27s approach

Two years ago, East Nashville's Dualtone Music Group hit the independent record label jackpot.

Dualtone signed a mostly unknown Denver-based rootsy pop band called The Lumineers to a record deal with a target of selling 30,000 albums. But, as Dualtone founder Scott Robinson gladly points out, the record label missed its target.

Driven by their massive radio hit "Ho Hey," the Lumineers went on to sell almost 1.6 million albums in the U.S. and 2.4 million worldwide. Their single reached No. 2 on the Billboard pop chart, and the band earned multiple Grammy nominations.

So how did eclipsing its own sales goals by over 2 million records change Dualtone? Turns out, not much.

The label's staff has grown from five at the time of the Lumineers release to seven now, and its office has been upgraded from a modest space above Pizzereal in the Five Points neighborhood to a larger, hipper building with enough room for a pingpong table and hangout space on McFerrin Avenue.

But on the heels of such unusual success for an indie label, Dualtone hasn't overhauled its business strategy and tried to storm the pop charts time and again. Instead, the label has returned to doing what it knows best: signing bands to straightforward, artist-friendly record deals, releasing no more than five albums per year and promoting them ferociously for up to 24 months.

It's the same formula that Dualtone, which was created when Robinson and co-founder Dan Herrington saw the industry shifting to become more favorable for indie labels, has followed since its inception in 2001. And it's the reason Dualtone says it can turn a profit on an album that sells 5,000 copies, as its recent release from Fort Atlantic has done.

"(We didn't think), 'Oh, wow, we broke through! We had a massive pop hit! Let's go sign 10 new pop acts,' " Robinson said. "No. It's business as usual."

Robinson said a second album by The Lumineers is going to happen on Dualtone, though no contract has been signed and both the label and the band declined to offer specifics on negotiations.

Lumineers frontman Wesley Schultz said the band chose Dualtone from a field of suitors that included major labels and other indies. Schultz, who is starting to demo new songs in Denver for the band's second album, said The Lumineers chose Dualtone because the label offered "the best, most fair deal."

Schultz said the relationship with Dualtone has been a partnership, not a corporate dictatorship.

"We always joke you go to some of these really huge labels or some of the 'cooler' indie labels and they're more concerned with playing poker online or how good their beards look," Schultz said. "They're not really working hard."

'Artist-friendly'

Seattle singer-songwriter Noah Gundersen, whose full-length debut album, "Ledges," exceeded internal expectations by selling over 8,500 copies in its first month, also had offers to sign with a wide array of labels. But when he and his sister, Abby Gundersen, who accompanies him on violin, visited the Dualtone office, they came away impressed.

Noah Gundersen is the more typical Dualtone act. He's building a national following. His honest folk style is striking a nerve with fans, and his songs lend themselves to licensing for television, film and commercials, another staple of Dualtone's business.

"My sister, Abby, who's played with me forever, and I have been to a lot of label meetings when we were courted by majors and large publishing companies," Noah Gundersen said. "All of our experiences in those meetings were so strange and awkward and disingenuous and they felt false.

"When we sat down with Dualtone it was such a pleasant experience. That was something Abby brought up. They felt like real people, and it didn't feel like we were being schmoozed."

Along with buzzworthy duo Shovels & Rope, Gundersen is one of two artists that Charleston, S.C.-based manager Paul Bannister has signed to Dualtone. Bannister said it's "pretty simple" why he has pointed his artists toward Dualtone.

"The truth is they offer artist-friendly deals where they're not screwing over the artists," Bannister said.

Dualtone President Paul Roper said "artist-friendly deals" typically mean straightforward percentage splits that represent true partnerships between label and band. Roper said Dualtone is attracted to bands that have a team in place and specific goals the label can help them achieve.

Usually, Dualtone has sales targets of 30,000 to 50,000 records for an album, but through licensing deals, it can achieve a profit without even reaching those figures. The label's artists, such as Fort Atlantic, frequently earn critical acclaim. Dualtone albums have earned 17 Grammy nominations and four awards.

"Fort Atlantic was extremely profitable even by selling 5,000 records because of the unique marketing ideas and great film/TV licensing activity that drove streams and track downloads," Roper said, adding that Dualtone's model is not for every artist because some need the more hands-on approach that major labels offer and others don't need a label at all to release their music.

"There is a uniqueness within our model: Where the outside industry would see 5,000 units sold and automatically assume a big failure, it was actually a great success for us," he said.

David Bakula, senior vice president for industry insights at Nielsen, said Dualtone would be considered a successful independent label even without the massive success of The Lumineers. Bakula said The Lumineers were able to place "Ho Hey" on multiple Nielsen charts because the song was so original.

In Nashville, independent radio station Lightning 100 began playing "Ho Hey" before the song exploded in 2012. It earned over 750,000 spins on Nielsen SoundScan-tracked radio stations. Lightning 100 Program Director Dave Rossi said it was critical for Nashville's music industry to see small, independent companies such as Dualtone find success.

"I think it's very important," Rossi said. "Everybody in the world is looking at Nashville right now. There's an expectation that we're going to be independent and do things our own way and we're not going to follow trends and just be like everything else."

Reach Nate Rau at 615-259-8094 and on Twitter @tnnaterau.

Dualtone Music Group

Founded in 2001; located in East Nashville; seven employees

2014 releases

Noah Gundersen, Shovels & Rope, Delta Spirit, Simon Felice, The Felice Brothers

Recent Dualtone releases and their U.S. sales numbers

The Lumineers' "The Lumineers": 1,577,000

Fort Atlantic's "Fort Atlantic": 5,000

Ivan & Alyosha's "All The Times We Had": 11,000

Shovels & Rope's "O' Be Joyful": 55,000

Source: Nielsen