After plummeting for over a decade, music sales have leveled off, but most artists still struggle to make ends meet from their music sales. Now, it may be easier than ever before to record and distribute songs, but it’s also harder to stand out in the crowd at the iTunes Store.

Steve Koskie, a technology entrepreneur and music industry veteran, thinks he can help remedy this situation for starving musicians. Koskie is chief executive of Monkeybars, a Calif.-based website the gives artists the ability to sell their music through websites, blogs, social media and many more channels.

Monkeybars enables artists who control their copyrights to distribute MP3s and videos at the price they choose. With this service, Monkeybars also adds a financial incentive for customers to promote the music they buy or listen to on social media. If a referral leads to a sale, the Monkeybars customer who made it collects a cut of the transaction.

The idea of giving music buyers an incentive to promote songs to their friends has been around for years, but no one has found a way to build a business around the concept. Randy Acker, an artist manager and attorney who's an advisor to Monkeybars, told the LA Times that the approach has always been an effective one, but the market and the major record labels weren’t ready for it. For years, record labels insisted that companies “wrap their songs in electronic locks” that prevented them from being played on iPods.

“Now, as consumers move from digital to mobile, the idea of a revenue-sharing collective platform has a good opportunity for a lot of traction," Acker said.

Image via Metalinsider.net

Monkeybars allows artists to determine how much of the sales price they'll keep and how much they'll set aside for referral rewards that range from 30 percent of the set-aside amount (when someone buys a track from your referral) to three percent (when someone who you've introduced to Monkeybars buys a track on someone else's recommendation).

Monkeybars gives artists the ability to generate revenue right away as they can make 40 to 120 percent more than they can through services that impose fees or demand a larger cut of the sales. According to Koskie, the site has generated $35,000 a month in sales for about 700 artists, which is about $50 per artist.

Additionally, Koskie acknowledged that unknown artists may want to build an audience by giving away tracks instead of selling them, which Monkeybars lets them do as well.  

Monkeybars presents a different retail experience for consumers from the mass-market online music stores. "It's the difference between the sort of high-end targeted store and one where you can get everything," said Acker. "ITunes is like Wal-Mart to me. Customers prefer smaller, more intimate and less of a sort of heavy sales mentality when they're shopping. It's so much about the process of discovery."

The goal for artists is expanding from their core fan base to the people they influence, who can connect them to a larger audience, and Monkeybars can contribute help them, Acker said, but it's just one part of the puzzle for emerging artists.

Next week, the company will be launching a month-long series of showcases for new artists, coming out of beta, adding tools to help artists analyze how Monkeybars users respond to their music and connect with fans.