A Proposal for Independent Record Stores and Labels
by Phonopolis
Having recently opened an independent record store, I’ve quickly become acquainted with the challenges that face small stores like mine, and the independent record industry in general. Although I would by no means describe these challenges as insurmountable, I do think they warrant a discussion of the way we do business.
As many of you know, for the last year or so, many independent record labels have been including a code with their vinyl releases that enables the buyer to download the record in mp3 format. Firstly, I think this is a great initiative, and is exactly the kind of creative thinking that indie labels need to be doing in this new environment. It gives many consumers the best of both worlds; an often beautiful (depending on the packaging), physical representation of the music (the record), but also the convenience of having that same music on their iPod/mp3 player. I’ve seen it go both ways, I have customers who’ll only buy vinyl if a code is included, I also have customers without iPods on whom the initiative is lost. For a brief time I was considering buying back mp3 codes from these customers and selling them again; an idea that was quickly abandoned due to obvious ethical problems - not being fair to artists or labels. But the idea got me thinking.
I think there should be serious thought given to the idea of selling mp3 codes in independent record stores. I know the idea might at first seem caught up in the hype of mp3s, but I think there would be a lot of benefits for stores, labels and consumers. Before I get into these benefits, I’ll first talk a little about the kind of system I’ve envisioned. Stores would stock a larger number of codes than they would CDs (they would of course still stock CDs). They would not immediately pay for these codes, however. The lack of immediate cost, and small amount of space that these codes would take would allow small record stores to carry a wider selection of stock and larger numbers of individual titles. The stores would validate the mp3 codes at the point of sale. During the validation process (which would be on a distributor or label website), the store would pay for the product.
For the stores, they could carry a wider selection in a smaller amount of space. Having a larger number of codes for each individual title, they would hopefully avoid running out of ‘indie hits’ after an especially good Pitchfork review. I think every store in the country experience this with the unexpected success of Vampire Weekend. No store could have predicted the demand for that record, distributors quickly ran out, and it took a couple of weeks to get the record back in. By the time record stores did manage to restock it, many music buyers had already flocked to iTunes or emusic.
For consumers, there are benefits to going to a record store, the first of which is getting away from your computer, getting out of the house, and talking with someone who is knowledgeable and enthusiastic about music. Browsing record/CD covers/artwork can lead you to discover new music. To be honest I haven’t downloaded a lot a music, so I don’t completely know how it works, but I assume that you’re not able to listen to the full record before you buy it. Record stores would have listening copies or opened CDs, so buyers would have a better idea about what they’re buying. I had a very honest customer inform me after listening to a CD that he was then going to go home and download it, and I’m sure many more less honest customers have done the same. There are other possible benefits, perhaps labels could print extra copies of the CD booklet that could be included with sale of the code.
I’m not sure how distributors would fit into the whole system. Something would have to be done about the obvious discrepancy with mp3 download sites not having to deal with distributors, and therefore not having to pay a middle man. It’s obvious that a lot would have to be worked out, and some questions remain. Is this something that would interest consumers? I’d really like to hear from people on this.
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Published on: April 9th, 2008
Terms Used: mp3, Phonelopie, phonopolis, record store, vinyl
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i really like it, i think - so you imagine sites would issue catalogues of their available downloads to stores, and i guess give store owners lists of purchase codes, and the code would give them access to purchase at a special store price?
Posted on April 9th, 2008 at 4:08 pm [permalink]
yeah i’d be worried that it would lead to the elimination of point of sales…like couldn’t people order the codes online more easily if they’re gonna download them there anyway? but i think you’re right that people want to browse through records at a real shop and use listening booths before they buy. hm.
i like the idea of having a real product (maybe a print or a booklet) that would come with the mp3 code if you bought it at a record shop. so you wouldn’t need to buy the cd, vinyl, cassette to get the code, but you’d still have incentive to shop locally. does it make sense to hang onto the idea of exchanging a physical product when we’re talking about digital downloads? i’m not sure.
Posted on April 9th, 2008 at 4:24 pm [permalink]
Yeah, I agree that a booklet or something physical to accompany the download would definitely make it more desirable for people. I don’t know if I completely understand what you mean about ‘the elimination of point of sales’…
Posted on April 9th, 2008 at 4:59 pm [permalink]
sorry, i just mean that people wouldn’t have to go to stores (or “point of sales”) to get the mp3 codes if they could get them online. but i guess if independent labels want to support record stores they wouldn’t make the codes available directly (or even though a distributor).
Posted on April 9th, 2008 at 5:49 pm [permalink]
Great post and great idea. I never had a collector mentality to cds - I’ve moved a million times, so first I ditched the cases in favour of CD books, and ended up losing the cd book altogether. Almost everything was on my computer anyways, so I was just as happy to lose the extra bulk. Last christmas, I emailed my best friend a mix rather than burning a CD (I knew he would only have ripped it before listening to it anyways). All this to say, CDs are a thing of the past.
These days I only buy CDs as a gesture to support artists and I only buy them at shows. Having the CD as an object is just annoying. Naturally, it becomes tempting to just download music for free if you aren’t interested in owning an actual cd. I’m still a little wary of paying for stuff online (call me old fashioned) and I think your solution is a good one. I love the idea of the code coming with a booklet or a poster, or a t-shirt, or something to make the purchase more fun.
Posted on April 9th, 2008 at 10:25 pm [permalink]
hey, i just found this video from hotkid about releasing their ep by screenprinting posters with download codes:
Posted on April 27th, 2008 at 1:53 am [permalink]
Sony BMG has tried something similar to this, which is selling album cards. Each album card allows you to download the album in MP3 format, along with a PDF of the album booklet and lyrics, directly from the MusicPass website. You also get bonus materials ranging from artist videos, making-ofs, and additional downloads from the Sony BMG catalogue. These cards are currently selling in non-music oulets like Pharmaprix (that was the idea, taking it out of the music retailer) But there would be nothing stopping from selling these in record shops or anywhere else for that matter.
I’m not sure if the stores pay for the album cards before a transaction is made. Traditionally in the music industry, the stores have taken the least amount of risk, meaning that even with CDs, they don’t pay for what they don’t sell, they just return it.
I agree with Tessa though in that that if you’re cool with getting your music in MP3 format, and cool with purchasing those MP3s, maybe you’re more like Alanah and you’re not going to go to a record shop to buy CDs, you just want the music and you’ll just get it online.
In terms of listening before you buy, I think this is pretty much fulfilled by the internet (file sharing, online streaming sites), you don’t need music store listening posts (and their lineups) for that anymore.
But you’re suggesting that people also want that community, that knowledgeable record store clerk that you just don’t find when shopping on iTunes. Perhaps it’s an opportunity for an innovative online retailer to offer access to a community of “clerks” who are available to chat with you online about the lastest releases and must-have classics.
Selling download codes at record shops seems like a great fit though, good idea.
Posted on April 29th, 2008 at 12:33 pm [permalink]