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.
Related:
- What’s to come: the future of social media consumption
- With broadband penetration (and capacity) increasing, and music devices increasingly connected to WiFi (iPod Touch, iPhone) or to 3G (Nokia’s big music push; laptops), the general consensus is that the future lies in media streaming, not the traditional stored music collections (be it shelves of LPs, stacks of CDs and DVDs, or hard drives full of mp3s and DiVX). A few years from now, you and all your friends will be consuming music online, on demand, from a myriad of different sources. If you use Mozilla Songbird, you can already pull in all the music posted on music blogs and Hype Machine into an iTunes-like virtual music library. Even more than infinite diversity of on demand music, the killer app for free (probably ad-supported) streaming media is that anyone can access it from anywhere in the world - they just need a link to it (unlike the mp3’s on your iPod). That’s the simple little thing that suggests we’re in for a REVOLUTION in the way we consume and discover music. The logic is simple: Someone will setup a service which, when you stream music or a video anywhere on the web, will alert all your friends (that have signed...
- Should new media actually try to compete with piracy?
- Spoke to some interesting people at the ContentNext mixer earlier tonight. Of particular interest were some guys from the film distribution industry, not just because it’s something I did some strategy work on in 2007, but because these are the guys (LOVEFiLM et al) that are really suffering from media piracy, no matter what they do (despite this, Amazon is reportedly taking a very strong interest in the aforementioned company). They’re stuck between pirates who refuse to pay for content, and film studios (publishers) that are used to scarcity selling (shifting low units relative to what could potentially be achieved with the Internet as a distribution network, at high margins) and refuse to drop wholesale prices to LOVEFiLM etc. The emergent call from the anti-RIAA crowd (Andrew Orlowski of The Register calls them, or us rather, “freetards“) is ‘don’t punish, compete!’ But a moment’s reflection suggests that that may be a fool’s errand. Firstly, how on earth do you compete with the following: Free! Huge catalogs of content on demand - every rarity Available in the format you want (or the open source/freeware tools to convert it) - e.g. losssless audio (FLAC) Leaked content available before it hits cinemas...
- Virgin Media anti-piracy: who’s the crook now, eh?!
- Virgin Media is looking to emulate the 'French model' of anti-piracy, big-label protective measures, which sees persistent (three strikes) offenders warned and then kicked off the network. This is old hat stuff but a complex issue. In the post below I make the case that society needs to be wary/cynical towards this announcement - moreso than our castrate mainstream media. Here's why: (...)...
Related posts brought to you by Yet Another Related Posts Plugin.
Add New Comment
Thanks. Your comment is awaiting approval by a moderator.
Do you already have an account? Log in and claim this comment.
Add New Comment
Trackbacks
(Trackback URL)