Measuring music sales in a new economy
With people “ripping” CDs and converting them into smaller, lower quality, more portable MP3 digital format, how do you measure music sales in today’s environment of free downloading?
Music is of particular interest to me, and I’ve been watching with great interest as artists and record labels adjust to a new medium for music delivery.
My blog today refers to small to medium sized bands. Larger bands—such U2, Coldplay or AC/DC—seem less affected by downloading than do smaller and medium sized bands. Some larger bands have circumvented this entirely. AC/DC, for example, does not have a song on iTunes and take the dip in record sales in the chin (or should I say with Stiff Upper Lip?)
First, a little background. MP3s first appeared in the mid-90’s but, from the late 90s on, it was the spread of Broadband Internet that made the download revolution possible. The telcos’ rapid deployment of ADSL/DSL and Cable Internet made large data transfer a practical reality. Music could now be sent and received VERY quickly.
Then came Napster, and the rest is history—right, Metallica?
The record labels were unhappy, but independent bands now had a free, international distribution network. Their music could now reach millions of people that would never have heard of them otherwise, and the advent of ‘Indy’ music spawned it’s own genre. (Originally, the description was intended to identify a band’s ind(y)ependent status with reference to record labels.)
”Garage bands” had a huge resurgence. Low-fi music production and simple song structures took on mass appeal. Now people could CHOOSE their music, rather than have radio stations decide what they would hear. Now bands such as The Strokes, The Hives, The White Stripes, The Vines were THE big music.
On the flip side of the new environment, the music of established bands was being downloaded for free, and this turned the music industry on its ear. CD sales spiraled slowly downward. Many music executives lost their jobs. And many bands were dropped by their labels.
It’s no surprise that record sales sagged dramatically. However, in an industry that relies heavily on demographics and geo-targeting, the revolution in music accessibility has the potential to make metrics and measurement the key to new opportunities for record labels in other areas of revenue generation (e.g. touring, merchandising, etc.)
Consumers are using programs such as BitTorrent (PC) and Transmission (Mac) to download via a torrent—but with the risk of connection to potentially very harmful websites. But what if there was a safe, secure location to download music for free (or pay what you will)?
First, lets look at the data that record companies receive when someone purchases a CD at a location. The information sent back to the record company is simple: Where, When and Cost.
However, what if there’s a download location for an album, with a standard Web form for requesting the download link? The form need only collect:
• First Name
• Last Name
• Email
• Age
From this, using Website Analytics, you could glean:
• Gender
• Location (down to the city)
• Valid E-Mail address
• What computer they use
• What browser they use
Now you have the demographic, the valid address, and can contact them at any time. Isn’t this the type of customer-base data that a record company would love to get? Harvested properly, this information would be invaluable for cross marketing bands or music of a similar genre.
An interesting case-study is a band called “The Black Kids” that offered their debut CD as a free download from their website. To receive the download link via email, music fans had to leave: Name, Gender, Email Address.
Did the strategy work? You bet! The band has since been signed to a record contract. So perhaps the record companies are starting to find their own comfort zone within the new realities.
Vive la revolution!
More on Web Measurement & analytics
