The Business Of Lady Gaga

Lady Gaga isn't the music industry's new Madonna. She's its new business model.

Dirk Smillie

In an interview last winter, Lady Gaga recalled her anguish at being ignored as she performed at a bar filled with drunken NYU students. No one paid the slightest attention to her until, fed up, she decided to strip down to her lingerie. "I started playing in my underwear at the piano and I remember everyone was all of a sudden like 'Whoa!' And I said, 'Yeah, you're looking at me now, huh?' "

Yes, we are. In the cacophony of the music business, Gaga has broken through the clutter with muzzle velocity, becoming a superstar in scarcely a year. Her first album, The Fame, is the best-selling debut album of 2009. Her single Just Dance has been viewed 87 million times on YouTube. Gaga's tracks have clocked 20 million downloads this year. One of them, Poker Face, is the most downloaded tune in the history of U.K. digital music.

Before she was Gaga, she was Stefani Germanotta, an obscure go-go dancer who worked burlesque bars in lower Manhattan. A precocious talent, she played piano by age 4 and clinched a seat at NYU's Tisch School of the Arts at 17. But her fame and commercial success hasn't followed the career template of Madonna (a trained dancer who worked her way up the club circuit) or winners of American Idol (where pop stars are selected by celebrity panel).

Gaga's business model starts with an incongruous product. Listen to Gaga's Poker Face and you might imagine it's Britney Spears in a track suit. But watch the video and you'll see a work of conceptual porn. Gaga, a 23-year-old blonde with bulletproof bangs and 3-inch lashes, slinks across stages in gleaming metal bustiers, smoked latex underwear and thigh-high stiletto boots. Performing Paparazzi at the Video Music Awards, she ended the set dangling above the stage in gauzy white La Perla lingerie, horrifying her audience as fake blood gushed from her bosom.

All this debauchery is purposeful fodder for social media and the mainstream press. "She's a perv, but Lady Gaga understands viral marketing better than anyone on the pop scene today," says magazine industry veteran Simon Dumenco. By showing up wearing a bird's nest or a model of the solar system on her head, every Gaga appearance becomes an item (11,500 mainstream media stories cite her this year). "She is directing every frame of her music and her life, imagining how clips will appear on YouTube and what people will tweet after she appears on the VMAs," says Dumenco.

She's meticulous about imagery, especially the sets of her live shows. Preparing for a gig in Los Angeles, she discovered that a stage had been painted a radiant shade of white. "This isn't the freakin' ice capades!" she yelled at the crew. It was repainted.

On Gaga's Twitter page, 1.6 million people track her outlandishness. They learn of Gaga's problems with hairspray and get updates on her father's recent heart surgery. Having that many followers can be perilous. Last month Gaga posted a link to one of her own videos on fashion icon Alexander McQueen's Web site. After a single tweet by Gaga, her rabid fans streamed in and crashed the site's servers.

Gaga leverages buzz by sharing the limelight with other, mightier entertainment brands than her own. "There's an art to fame," Gaga once told Vancouver television. Performing with members of the Bolshoi ballet, she wore a hat designed by Frank Gehry that resembled a mini Bilbao and played a piano painted by Damien Hirst. This year she collaborated with Beyonce and Michael Bolton. In October she showed up on Saturday Night Live with Madonna, where the two of them, dressed in matching dominatrix gear, tussled in a mock catfight (and near kiss).

One surprise: Gaga's outré sexuality hasn't fazed corporate marketers. Branding guru Steve Stoute, who paired Jay-Z with Hewlett-Packard, is working on a handful of tie-ins for Gaga. This month he inked a deal for her with Mac cosmetics. Next will be Gaga-branded electronic sunglasses, he says, similar to the ones that often cover half her face in concert.

Also in the works: a rock opera whose soundtrack may come from her new album, The Fame Monster, released this week. Gaga's 41-city "Monster Ball" tour begins Nov. 27 and reportedly involves 14 costume changes. The tour will be tough to match Gaga's own standards. As she reminded herself in an interview, " 'Now that you have everybody watching, Gaga, you'd better be f***ing great.' "

via: forbes.