NARM Notes: Nielsen Numbers, Talk of a Hybrid CD
The NARM website is hosting a PDF of the Nielsen presentation titled "State of the Industry." Lots of juicy numbers if you're into that kind of thing. Lots of positive spin as well. "Consumers made 1.6 billion purchase decisions in 2007 (1.3 billion in 2006)," it says on page three. Other interesting tidbits: 450,344 albums (80% of the total) sold fewer than 100 units in 2007 (page seven); 1,000 of the 570,000 albums that sold at least one unit account for 50% of all sales (page eight); and 37% of all album sales in 2007 were from new releases -- the lowest percentage since SoundScan was launched (page eight).
Nielsen SoundScan's Rob Sisco and Chris Muratore massaged the numbers for the NARM audience by telling people unit purchases of books, movies and music were up 6.8% in Q1 2008. Very few of the Nielsen numbers address the most important thing, the dollar value of sales. (Billboard.biz)
A really interesting slide is page #17, which lists market share by retail store type. Check out how far chain store sales have dropped -- 51% in 2003 to 34% year-to-date in 2008. Mass merchants have held steady over the last five years, indies gained a percentage point last year and non-traditional (mostly downloads at Amazon.com CD sales) have risen to 23% year-to-date in 2008 from 4% in 2003.
NARM president Jim Donio outlined key challenges in an opening speech at NARM. One solution to tanking CD sales, he said, may be a hybrid "CD 2.0" format. Good grief. If that was ever going to work (and judging from the DualDisc it didn't) it's years late and should have taken the shelf space of copy-protected CDs. Here's what I think: nearly all people still in the market for CDs expect and want the CD to play music and music only. They're older consumers who grew up with the basic CD. Don't trick out the format in hopes of pulling in the younger generation. If there's bonus content, stick it on a separate disc in the package. Forget the hybrid stuff and be wary of putting music on DVDs. There are ways to offer exclusivity to CD purchasers (online fan clubs, for example) without adding bells and whistles to the basic CD. And whatever you do and however many are pressed, call it a "limited edition" so people think it's more special than it really is. (Billboard.biz)
IODA unveiled branded download stores. (Press release)
The Entertainment Software Assn. is collaborating with NARM to add film data to NARM's searchable database. (Video Business)
Music Groups