A new report from the RIAA on music sales in 2020 proves that the vinyl revival is far from over.
As the first anniversary of America’s COVID-19 shutdown looms overhead, new data provides a better understanding of changing consumer habits. The RIAA’s 2020 year-end revenue statistics report finds that the industry is continuing to grow despite everything. It may not look like it did in the ‘before times,’ but that isn’t necessarily a bad thing.
According to the report, United States recorded music revenues grew 9.2% in 2020 to $12.2 billion at estimated retail value. This is the fifth consecutive year of growth for the industry, as paid subscription services continued to be the primary driver of revenue increases and reached a record number of subscriptions. Covid-19 affected the industry significantly through tour cancellations, retail store closures, and other disruptions. Revenues from recorded music measured at wholesale value grew 8.9% to $8.0 billion.
The report also reveals a somewhat surprising statistic regarding physical media. For the first time since 1986, revenues from vinyl records were larger than from CDs. Total revenues from physical products were virtually flat at $1.1 billion (down 0.5%). Despite the challenges to retail sales from Covid-19 restrictions, vinyl grew 28.7% by value year-over-year to $626 million, though still only account for 5.2% of total revenues by value. Revenues from CDs declined 23% to $483 million, continuing a long-term decline.
The top selling vinyl record of 2020 was Billie Eilish’s debut album, When We All Fall Asleep, Where Do We Go?
Outside of CD sales, the hardest hit sector of music consumption was digital singles, which saw sales slip more than 20% compared to the year prior. Digital album sales were down 13%. With streaming services continuing to grow, it seems likely that digital sales will continue to fall in the years ahead.
The novel coronavirus and its devastating widespread economic impact are not enough to stop the music industry’s seemingly endless growth.
March 2020 feels like a lifetime ago. When COVID-19 forced the immediate suspension of live music and placed millions into isolation, music industry analysts feared the worst. A lack of concerts meant a dip in revenue, and a lack of commuting said the same about streaming royalties. Thousands found themselves out of work, and many remain unemployed (at least in music) today. The idea that music would grow this year was far-fetched, to say the least.
A report published by the RIAA this week that was shared by Billboard with an article from author Dan Rys found good news still exists. The U.S. recorded-music business was still in an upswing in the first half of 2020, growing 5.6% at retail to $5.7 billion, up from $5.4 billion, continuing a trend of growth that extends back to the industry’s nadir in 2015.
RIAA graph depicting change in mid-year retail revenues year over year
The less than great news is that industry-wide growth took a pandemic-related hit. The latest numbers end a streak of double-digit gains that bega with a mid-year report in 2017. Such growth is hard for any industry to maintain with or without a global pandemic, but the change is happening much sooner than expected because of COVID-19.
As part of the total $5.7 billion in revenue, streaming accounted for $4.8 billion, or 85%, increasing its share from the 80% it held at the same point in 2019 when it totaled $4.3 billion. And within that, paid subscription revenue accounted for $3.8 billion, an increase of 14% over last year and 67% of the total revenue share overall, and 79% of streaming revenue. Additionally, paid streaming subscriptions was up 24% for the first half of the year, to 72.1 million from 58.2 million at the same point in 2019.
The continuing spread of the novel coronavirus has kept many physical music retailers closed for the majority of 2020. It is no surprise those closures affected physical media’s standing in the overall music ecosystem, where it now accounts for just 7% of all recorded music revenue. Digital claims the remaining 93%, which is 2% gain over 2019.
Something report cannot account for is how much different the data would look if the releases delayed due to COVID-19 were released. While many artists have moved forward with their original plans, countless others are holding their records until a time when touring and more traditional music promotion is possible.
“These are historically difficult times: the live music sector is shut down; studio recording is limited; and millions of Americans are out of work across the broader economy,” RIAA chairman/CEO Mitch Glazier said in a statement accompanying the report. “While we’re pleased that the years of hard work and resources we’ve invested in streaming are driving growth in paid subscriptions, today’s report demonstrates just how much work remains to achieve a sustainably healthy music ecosystem for both music creators and fans. We must continue working to help sustain live music and venues, support gig workers and session musicians, and ensure fair pay for music on all digital platforms. Despite all the challenges from the pandemic, one thing clearly hasn’t changed — fans still love music.”
Reversing a rule implemented in January, Billboard has updated the rules regarding album sales and charts to reflect consumer intent better.
Achieving success on the Billboard charts is a lot like trying to win a presidential election. You can do your best to make as many people as possible buy your music outright, or you can find smart ways around traditional album sales. One example of the latter is bundling, which combines a digital or physical album with the purchase of merchandise or concert tickets. Such tactics have helped several performers appear to move massive units of their latest record and top the chart, but thanks to new guidelines, that approach no longer works.
Billboard is changing the rules to its Billboard 200, Hot 100, and other album and song charts. The announcement comes to rectify how sales are counted with respect to album bundles with merchandise and concert tickets, as well as instant digital sales attached to purchases for physical albums delivered at a later date.
On the issue of bundling, the latest rule changes supersede several others that were previously instituted in January. Those included a requirement that albums bundled with merchandise be available for purchase concurrently and individually on the same website, as well as a condition that merchandise sold on its own be priced lower than bundles that included the album. Additionally, merchandise/album bundles could only be sold on an artist’s official direct-to-consumer web store and not via third-party sites.
Billboard is now acknowledging what many critics have claimed to be true. Album sold in bundles with merch and tickets may not accurately reflect consumer intent. There are many cases of fans buying tickets or merchandise without realizing (i.e., caring) that the sale included an artist’s new album. So, if the fan doesn’t buy the bundle specifically for the release, why should the sale count toward the total units of that album sold?
Billboard will also no longer allow sales of physical albums or singles that are bundled with digital downloads to be reported as digital sales. That decision eliminates the practice of “spontaneous” non-manufactured items being used to influence first-week chart rankings. Only when the real thing — that is, what the consumer is buying — is shipped, will it be counted in Billboard’s official tallies.
The practice of selling vinyl, CDs, and other physical releases that won’t be manufactured and shipped to consumers for weeks or months — while offering a digital download that can be redeemed instantly — has become widespread as of late. Especially in the age of COVID-19, when manufacturing delays are rampant, many artists are using the promise of a physical item later to boost “sales” in the present.
Billboard recognizes that the use of bundling has been commonplace in music for decades. However, the practice of using merch and ticket bundles to boost album sales has been rampant as traditional record sales have fallen. The goal of the Billboard charts is to capture consumer intent, and the company believes it is impossible to gauge whether or not the sale of bundles reflects a clear desire to own the release rather than a piece of merchandise or attendance at a live event.
The Strokes’ first album in seven years made a massive debut on the Billboard charts this week.
The Strokes’ new album, The New Abnormal, debuts at #1 on this week’s Billboard’s Top Album Sales Chart. The album is also #8 on the Billboard200 and is #1 Current Rock Album, #1 Top Current Album, #1 Current Alternative Album and #1 Vinyl Album.
The Times of London praises “The Strokes give us their second masterpiece,” while The New Yorker raves the album “sounds better to me than almost anything else I’ve listened to this spring.” NPR Music calls The New Abnormal “one of their best,” and Rolling Stone says it’s “their best since the glory days of the early ‘00s.” The Independent praises, “stacked with rolling, streetwise grooves, boldly graffitied onto the chipped paintwork of New York City past,” while Evening Standard says of the album, “Bold comeback is their best in years… Up there with their best work while sounding boldly different from it.”
The New Abnormal features previously shared tracks “Brooklyn Bridge To Chorus,” “Bad Decisions” and “At The Door.” The music video for “At The Door” premiered during the band’s performance at Senator Bernie Sanders’ University of New Hampshire rally. The album is The Strokes’ first in seven years and was recorded at Shangri-La Studios in Malibuand produced by Rick Rubin. The album’s cover artwork is a painting by Jean-Michel Basquiat, Bird on Money.
The Strokes promoted The New Abnormal through Haulix, the industry’s leading promotional distribution platform. You can join Haulix today and receive your first month of service for free. When you do, you will have access to the same tools used by The Strokes and countless other Billboard chart-topping talent. Click here for details.
Stream The New Abnormal below. COVID-19 is preventing any live performances at the moment, but we expect The Strokes to announce tour dates when it is safe to tour. Stay tuned.
Vinyl sales hit a fourteen-year high in 2019 while overall physical album sales continued to decline.
People like to argue about the longevity of physical media. Buying albums, they say, guarantees a record will be part of your collection for the foreseeable future. Streaming gives us access to virtually all music, but for how long? What is stopping Spotify from tucking specific releases behind a premium plan? Can anyone guarantee artists won’t decide to pull their catalogs from streaming platforms until royalty rates rise?
The individuals that like to make these arguments are correct in their beliefs regarding physical media. Streaming makes everything easy, but despite the popularity of services like Spotify, the future for the medium remains unclear. If you absolutely must have an album in your life, the best way to do so is to buy a physical copy.
Sadly, it seems, people want to own albums less and less. In 2019, Americans purchased 73.5 million records in some physical format, be it CD, vinyl, or even cassette tape. Of that figure, 18.84 million were vinyl, which is up over 14% from the year prior, according to data shared by Nielsen Music in its annual year-end report on how the music industry is doing.
In total, vinyl now accounts for more than one-fourth of all physical media sales.
A large portion of the vinyl album sold in 2019 stems from records widely considered to be classic. The Beatles sold more vinyl records than any other group last year. Bob Marley, Queen, The Beach Boys, and Fleetwood Mac also sold incredibly well.
When it came to new talent, Billie Eilish was ahead of the pack. The teenage pop singer sold more than 175,000 copies of her debut record, When We All Fall Asleep, Where Do We Go?, on vinyl. That’s more physical sales than most artists see from all physical formats combined.
It seems likely that vinyl will continue to lead physical media sales in 2020. Older generations are clinging to their favorite format, and younger generations have fallen in love with the sound and look of great records. Vinyl is a high-risk investment for young artists, but it can yield high returns with the right audience
The streaming revolution is helping the music industry recover with each passing year, but there is still a long way to go.
Music fans and industry professionals too young to remember the panic that followed the start of the new millennium are lucky. For years, the widely accepted narrative that music piracy made easy by the internet was killing the business of music left many feeling lost and afraid. Labels downsized, if not folded entirely, and many artists on the rise struggled to convince fans that music was worth the same price it previously demanded.
Paid streaming subscriptions were sold to industry as a savior, ushering in a new era of consumption that would counteract the effects of illegal music downloading by making virtually all recorded music accessible from anywhere on Earth for one low price. The return for buying into that promise took years to appear, but there is no denying that streaming services have made a positive impact on music overall. Everyone knows someone who pays for streaming music. In fact, it’s increasingly hard to find someone who doesn’t
According to a new report by the International Federation of the Phonographic Industry (IFPI), global recorded music sales grew by 9.7% in 2018, to $19.1 billion, the fourth consecutive year of growth after many years of decline. The results were driven by a surge in paid streaming, which rose by 33% last year.
Adjusted for inflation, however, sales in 2018 were just over half of what they were in 1999.
As we previously highlighted on our blog, there are now 255 million paid music subscribers, accounting for 37% of total industry revenue. When ad-supported services are added, streaming now accounts for 47% of sales of recorded music.
That growth is impressive, but again it’s important to maintain perspective. While streaming continues to gain popularity, its market dominance most offsets losses in the sales of physical media.
Revenue for physical formats in 2018 fell 10% from the year prior, and digital download revenue fell by 21%.
Major labels now celebrate the success their artists experience from streaming services, which is surprising considering the stance many in the industry took against such platforms just a decade ago. It seems many see streaming as the best way to prevent piracy, even if it means a lower return than what physical media sales offer.
Not long ago, many industry movers and shakers believed all physical media to be either dying or dead. Streaming, they claimed, would soon replace the need for media in any other form. They were wrong.
According to Nielsen’s recently released report on the music business, cassette sales in 2018 rose 23% over the previous year. That’s more than 4x the total number of cassettes sold in 2014 (roughly 25,000). In total, more than 215,000 tapes were sold during the calendar year, with many of the biggest totals coming from catalog releases more than a decade old.
That figure is a far cry from 1994 when total sales for cassettes topped 246 million, but it’s a healthy number nonetheless. The market for cassettes has grown consistently in recent years and is likely to grow further still in 2019.
The top-selling tape of 2018 was, perhaps unsurprisingly, Guardians of the Galaxy: Awesome Mix Vol 1. The release, which is one of three soundtracks from the Marvel comics film series to land on the best-sellers list, features packaging that is similar to a mixtape made and used by the lead character in the movie.
Awesome Mix Vol. 1 as seen in Marvel’s Guardians of the Galaxy (2014)
Other artists that made the top 10 list for 2018 include Twenty One Pilots, Wu-Tang Clan, and Elvis Presley, among others. You can view the full list of best-sellers below:
R
Artist, Title
Sales
1
Soundtrack, Guardians of the Galaxy: Awesome Mix Vol. 1
24,000
2
Soundtrack, Guardians of the Galaxy, Vol. 2: Awesome Mix Vol. 2
19,000
3
Twenty One Pilots, Trench
7,000
4
Soundtrack, Stranger Things: Music From the Netflix Original Series
5,000
5
Britney Spears, …Baby One More Time
4,000
6
Soundtrack, Guardians of the Galaxy: Cosmic Mix, Vol. 1
3,000
7
Guns N’ Roses, Appetite for Destruction
3,000
8
Metallica, The $5.98 EP: Garage Days Re-Revisited
3,000
9
Elvis Presley, Where No One Stands Alone
2,000
10
Wu-Tang Clan, Enter the Wu-Tang (36 Chambers)
2,000
Cassettes may never be as big as they were in the late 80s and early 90s, but the numbers revealed by Nielsen show the market for such media is thriving more than it has in recent years. Smaller artists may not move as many units as the acts above, but considering the low cost of uplication, the cassette tape remains a viable merch option for anyone trying to give their fans something they can hold that isn’t a t-shirt or beanie.
The industry is changing. Aside from the rise of streaming, which has completely altered the way people consume music and the way artists make money, the business as a whole seems more uncertain than ever about what might come next. Will festivals continue to grow in popularity? Will radius clauses force up and coming acts to choose between high-profile gigs and a series of smaller, more intimate performances? Will venues demand more substantial cuts of merch sales? Will fans still want physical media, and if so, in what format?
These questions and many more are pondered in offices and at conferences every year. They each create an excellent foundation for conversation, but the outcome is usually the same: We won’t know until it happens. Maybe the festival bubble will burst, but then again, perhaps it won’t. Maybe smaller artists will breakout from a single high-profile appearance, but they may fair better with smaller gigs that provide fans more access to the talent. It’s all up in the air all the time, and more importantly, not every answer works for everyone.
One thing that is certain: We will continue to debate the livelihood of albums until the end of time.
Every year for the past decade there comes a time, usually in the fall or winter, when significant publications debate whether or not the albums are practical. The most recent outlet to hop on this bandwagon is Rolling Stone, who just this week published an article claiming records are ‘in deep trouble.’
For those who prefer a TL;DR explanation, the latest round of ‘RIP Albums’ posts stem from a report released by the RIAA a couple months back regarding sales in 2018. According to the numbers, total album sales for the first half of 2018 were down 25% compared to the first half of 2017. If that figure continues for the second half of the year, which many believe it will, then total album sales will plummet 50% compared to the previous year. That is a major drop, and it’s being said that track-led consumption through streaming services. In other words, people love singles, and the popularity of playlists in the streaming arena has made the success of a single track, not to mention its ability to be placed, over the quality of albums.
But there’s more to the drop in sales than the popularity of singles. Cultural trends play a part in consumer behavior as well, and right now there are no two genres of music more popular than hip-hop and EDM. An artist in these areas can make a career out of one song. Sheck Wes, for example, landed a record deal with Kanye West’s GOOD Music off the strength of his viral hit “Mo Bamba.” Similarly, Cardi B found international success with “Bodak Yellow.” She was hailed as a new artist because of the release, despite the fact she had previously released multiple mixtapes.
Both Sheck Wes and Cardi B released albums in 2018, but when discussing their successes and failures, it’s the singles that lead any conversation.
And speaking of conversation, you can probably add social media to the list of things contributing to the belief albums are dead. It is far easier to not only digest single tracks but also to discuss them. It takes less than five minutes to stream most singles, and just a matter of seconds to tweet out one’s thoughts on the material. Albums, on the other hand, require far more time and attention. You could easily spend an hour listening to a record, and expressing your thoughts on the material in full will likely require more than 280 characters (the maximum length of a tweet). Culture has trained people to believe that if they’re not contributing to the endless chatroom that is social media, then they are somehow missing out, which in turn encourages people to stay on top of everything that can be consumed at a moments notice. Singles are more accessible, which means more people can make time to consume them. More people = more conversation.
Rock and country music work differently. Artists hoping to make it in those areas of music need to not only have good singles but also must tour heavily, which means performing numerous songs any given night. One great track may help start a conversation, or even land a meeting with label execs, but those who become household names must also possess a catalog of potential hits. Fans of these genres still buy albums, but because country and rock are less popular than they were ten or even twenty years ago the most successful LPs cannot hold a candle to the streaming numbers artists achieve in other genres of music.
Albums are not dead, and they never will be, but as consumer behavior continues to evolve there may be less of them garnering attention. This same trend can be found in all areas of entertainment. Paintings, for example, were once the height of entertainment. Most people can name iconic talents such as Van Gogh or Picasso, but how many modern painters do you know? There are galleries of all sizes in cities all over the world showcasing current talent all the time, so surely someone is paying attention.
It’s hard enough to get people to click play, or Like, or Favorite, or whatever else, but to get someone to pay money for any album in 2015? Who does that? Ask any number of mid-level bands who are still managing to sell 5,000+ in first week sales. Great numbers compared for 2003? Of course not, but I’ll take 1,250 in sales than 72,000 “Likes” any day.
“You can’t transform the record buying public into a million clones of your mum, sadly, but you can still apply this lesson: People value music that they are personally connected to and such music is scarce – therefore it is not worthless … People who have no reason at all to pay anything for 45 minutes of generic recorded music have a host of reasons to pay for 45 minutes of music that they know will explore the happy side of a depression that they recognise in themselves recorded by that nice girl who played in their local, chats to them about Geordie Shore on twitter, wrote that great blog post about economics and such; and who seems like a nice person who you could approach if your download didn’t work properly.”
Can you know all 1,000 people who bought your album in the first week? No, but it wouldn’t be a stretch to have a few hundred of those emails. Probably a few of your followers on Twitter bought your album, and some even came to your show.
There’s no shortage of jerk-asses that get press everyday for stupid shit. But there are probably so many albums out there that people are crying to in their bedrooms at night, or screaming along to in their cars at night. Bands that aren’t just “music,” but they mean the world to some folks. Strive to make that sort of music first and foremost. Count your successes in the number of people who thank you after the show, or shoot you an email, not in magazine covers or music blog mentions.
Maybe “nobody” buys music in 2015, but if only one person buys your album this month make them feel like they’re somebody.
Seth Werkheiser is the quiz master of metal trivia at Skulltoaster. He’s also the founder of some music sites you may have heard of, including Noise Creep (2009) + Buzzgrinder (2001). He’s anti-Facebook, anti-clickbait, and anti-growth hacking. You should most definitely follow him on Twitter. Yes, right now.
Hello, everyone! Thank you for finding time in your schedule to spend a few minutes with us. This week has focused heavily on ways artists can keep merchandise costs low while furthering their overall reach, and this post is a continuation of that effort. If you’re feeling burnt out on this topic, don’t fret. We’ll be back to our regular series of interviews and editorials next week.
This site exists to promote the future of the entertainment industry, and to do that we need input from people like you and your entertainment-loving friends. If you have any questions about the content in this article, or if you have an artist you would like to see featured on this blog, please contact james@haulix.com. We can also be found on Twitter and Facebook.
Today is the day before Thanksgiving, which means we are less than two full days from the official start of the year’s busiest shopping season. Christmas is right the corner, and if you’re smart you’ve already begun putting thought into the various sales and discounts you are able to offer fans during this time. If not, there’s still time to get prepared, and we’re here to offer a little help.
We cannot guarantee a boom in sales this holiday season. In fact, we cannot guarantee a rise in the number of sales you see at all. What we can do, however, is help ensure your marketing and sales efforts are top notch. To do that, follow these tips:
Check your inventory. Twice.
Your goal with holiday sales should be to liquidate as much of the merchandise you have in stock as possible while still making a healthy profit on each product sold. Before you can do this to the best of your abilities you need to know what you have available, and how much of it is in stock. Running out of something during your holiday sale will cause headaches for everyone, and that goes double if you run out of something because you forgot to check your inventory prior to launching your sale. The back and forth required to straighten out orders that cannot be fulfilled may cause you to lose future sales, as well as those you are forced to cancel. Prevent this mess from ever happening and do inventory first. Do it twice, in fact, and ask someone else to check your work.
Promote your entire sale, as well as individual items.
You want people to use your discounts to buy more than they usually would, but often those attempting to promote a store-wide sale forget the impact that promoting key items one at a time can have on consumers. You should still mention store-wide discounts, of course, but you should also make room to highlight individual items. If you’re offering 25% off everything online, you should promote the sale as how it impacts items like shirts or vinyl. Create images for Instagram and other networks that highlight how the discount impacts the cost of single items, that way people can more easily understand what a great deal you are giving them. Likewise, you can use Twitter to promote various items and their price after discounts throughout the holiday weekend.
Speaking of promotion, think about paying for it.
I’m about to say something most artists hate to hear: Paying for promoted posts on Facebook and Twitter can have a positive impact on your reach, as well as your overall sales. It would be wonderful if this were not the case, and that those who could not afford paid promotion on social networks saw their sales work just as well, but years of research has made it clear that is not the case. Thankfully, the cost of entry into paid promotions is low. For as little as five dollars you can have a guaranteed reach to hundreds, if not thousands of people who have previously enjoyed your music enough to give you a Like/Follow online. Whether or not they take advantage of the message being conveyed will depend on how you choose to present yourself, but at least you know your efforts are reaching those who are most likely to jump on them.
Create specific Twitter search streams for particular items you sell.
This one is a bit more time-consuming than other tips, but it can help you bring in a lot of new consumers who may have otherwise not checked your store. There are numerous tools that allow you to create and save Twitter search streams. Find one you like and use it to track people tweeting about shopping/looking for things like ‘new vinyl’ or ‘cool band t-shirts.’ It’s likely these people already have an artist or genre in mind when they send these messages, but you can still reply with links to your store and music. If they don’t respond, oh well. If they do, you’ve got a potential new consumer/fan.
Make the most of SEO
We’ve talked about this before, but keywords are becoming increasingly important when it comes to how people find your content online. Use a tool such as the Google Keyword tool to better understand how your customers are searching, then modify your own store to reflect what you have learned. It is important to know which keywords are mostly used during the holidays, such as ‘sales,’ ‘top gifts,’ ‘cyber Monday,’ and ‘black Friday.’
Make sure everything is working before promoting your sale.
This one may seem obvious, but every year there are a handful of musicians who see their site, or at least parts of their site, crash amidst the sudden upswing in view brought on by the holiday shopping season. Before you push your sale live, make sure every item on your store is properly listed and that every sale is working correctly. If there is a code word needed, make sure you test it out prior to sharing it online.
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We have plans to share additional merchandising tips for bands in the weeks ahead. If you have an idea for a column, or if you have a question about merchandising and branding that you want us to answer, please email james@haulix.com and share your thoughts. We look forward to hearing from you.
