By Allen Johnston – The Music Specialistwww.asha.com
The music industry has changed drastically and will never return to what it once was. If you think selling a million CDs is still realistic, it’s time to reconsider.
Take Richard Branson, the billionaire founder of Virgin, who saw the writing on the wall years ago. He exited the physical music retail business by leasing his Virgin Megastores to real estate firms. Iconic locations like the Virgin Megastore in Times Square have since closed their doors, and the broader trend is undeniable. Since 2003, over 80 record stores have shuttered in Manhattan and Brooklyn alone, and major chains like Tower Records, Sam Goody, and FYE are now relics of the past. Today, only a handful of specialty shops remain.
In 2024, the largest music retailers are no longer record stores—they’re big-box giants like Walmart and digital platforms like Apple Music and Spotify. Walmart, for example, has mastered leveraging its physical retail power to drive music sales. The chain has prioritized exclusive deals with artists, bypassing traditional record labels.
A decade ago, Walmart's exclusive release of the Eagles’ Long Road Out of Eden sold over 700,000 copies in its first week, an impressive feat for a declining CD market. Similarly, Journey’s Revelation, a three-disc collection, moved 45,000 units in its first three days. Walmart’s strategy included in-store promotions, prime shelf space, and even playing artists’ music videos on big screens throughout the store. This approach demonstrates the power of direct-to-retail distribution and highlights the diminishing role of record labels as middlemen.
The Problem with Major Label Deals
In a world where artists are giving away music for free or leveraging streaming platforms to build audiences, clinging to major label deals doesn’t make sense for most musicians. Traditional contracts often leave artists with just 10%-18% of the retail price after deductions.
Why accept such terms when independent distribution and exclusive partnerships offer artists more control and a larger share of the profits? The old model of relying on labels for distribution and marketing is no longer necessary in 2024.
A Vision for the Future
To stay relevant, the music industry must innovate. One bold idea could be for record labels to collaborate on opening centralized "state stores" in major cities, akin to liquor store models in certain states. These stores could showcase new releases, catalog classics, and provide shelf space for independent artists and labels. Without a fresh approach, the industry risks losing all physical exposure, a critical touchpoint for music lovers.
The New Reality
The music business in 2024 is about adaptability. From streaming dominance to direct-to-consumer strategies, the landscape has evolved far beyond the traditional record store or label deal. Artists and industry professionals alike must embrace these changes, innovate, and focus on new ways to reach their audience. The future belongs to those willing to think outside the box—and outside the CD case.
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