Has Elvis Costello inadvertently stumbled on the future direction of physical media retailing?
News comes via Stereogum that Elvis Costello’s new release will be the latest in a line of retail/marketing experiments from music artists rich enough to take the hit if it bombs (or music pirates run away with their product without so much as a ‘thank you’). And, of course, experiments by those not rich enough to take the hit.
Costello’s wacky experiment will sell you a digital download code for his album, and then post you the package – WITHOUT the CD (presumably, you download it and burn it yourself). At first glance this seems like a pretty lame attempt to appeal to the digerati and be more contemporary. Wow, whoopee shit, he trusts people enough to let them burn their own CDs. Thanks Elvis! I never burned a CD before you allowed me to! [/sarcasm]
But there’s a lot more to it than that. Firstly, it acknowledges that now, digital > physical. The mp3 will get more plays than the CD. So save people the difficulty of ripping their CD, directly sell them the mp3 – but they’ve bought the whole album, not just their two favourite singles, and part of the value-added of an album is the physical packaging (liner notes, cover art) [it sure as hell isn't the crappy 'filler' songs that get wrapped around the single-worthy tunes - usually]. So give them that. Let them have their cake, and eat it too, basically.
What Costello has done therefore is persuaded people to buy the (profitable) album instead of 1 or maybe two standout tracks on iTunes. He gets more money out of your pocket, because the extra tracks you end up paying for presumably didn’t cost him that much to make, and a plastic case plus nicely designed paper booklet? A few pennies. He’s sold you a more profitable product (the profit on a £10 purchase, vs a 79p purchase), plus it’s probably got a better profit margin, too. And you have the convenience of not having to rip your CD to get the mp3 plus the physical component.
Does this digital+ (digital plus physical “value-added”) retail strategy have a future? Maybe. I hope for the music industry’s sake that it does, because this would bring back the album format on which so many of its profits were built. Jay Z’s refusal to put his recent music on iTunes unless it’s sold as an entire album unit is testament to the fatal error the music biz made in allow iTunes to de-package their high-value (“sells at a high price as though the sum is greater than the parts”) albums into singles.
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