February 9, 2018
The news story circulated this week that Best Buy will discontinue selling CDs this summer. The reaction of many record stores, including ourselves, was basically "Pfft, what took them so long?" In case you haven't noticed, in recent years they've shrunk their CD section and moved it farther and farther back. You could find a better selection at some truck stops.
But we've seen a lot of talk and confusion about it online, from "the end of an era" to "sad" but also "who buys CDs anymore, anyway?" As Flavor Flav said, "Don't believe the hype."
First of all, Best Buy has been de-emphasizing CDs for years. Ten & fifteen years ago, they used them as a "loss leader" - selling them below cost to get you in the door so they could sell you a high-dollar appliance. With the rise of the digital download came an obvious decline in CD sales, and they found themselves devoting more square footage to the format than made sense. In the last couple of years, their CD selection has been limited to the top 200 new releases, some cheap core catalog, and some even cheaper greatest hits packages. Today, you probably couldn't find even 500 titles there.
It's estimated that Best Buy sells $40 Million in CDs annually. But they have 1026 stores nationwide, so that averages out to less than $40,000 in sales per store in a year, or around $3000 per month. Um, that's really bad! What that tells me is that people have already stopped going to Best Buy for CDs. The decision was already made for them. So there's not really any news here.
The interesting business story behind the curtain is twofold. One, what CDs have represented to Best Buy in recent years is advertising revenue from the record labels. Their weekly sale flyer with pictures of new release CDs and DVDs is a money generator. So by discontinuing CDs, what they're losing isn't sales, but a revenue source.
Two, the record labels have for years been afraid of losing that sales channel. They've been dependent on shipping lots of units to big box stores. However, the handwriting has been on the wall for some time, so I have to assume the labels have made their peace with that eventuality and are prepared.
The whole point of all of this isn't to slam Best Buy. I've actually had pretty good experiences buying electronics from them. But what invariably happens when the media reports an item like this is that the general public totally misconstrues what's going on.
What's going on, as it affects you, is... well, not much.
Except for this - not only are we going to continue to sell CDs, we're actually adding to our CD inventory. We're currently evaluating what's available to us from a wide variety of different distributors and plugging some holes in the catalog here and there. We're also realizing what a great source of inventory there is from import sources. The European record labels have a lot of great titles in print that are out of print in the US, at really great prices.
So stop by over the next couple of months and see for yourself. You'll start finding a lot of CDs that you haven't run across in years. Decades even. And that's all to say nothing of the used CDs. We're still buying them hand-over-fist. If you have collections you don't listen to anymore, bring them to us & we'll make you an offer. (Can't say that about your iTunes collection, can you?)
Ok, you might say, really guys this is all quite well and good, but why should I care? Quite simple. One, CDs on a nice sound system generally sound really good, much better than what you'd stream or download. I know audiophiles who say they sound better than vinyl. Two, once you buy a CD, it's yours. You don't have to worry about the streaming service losing the licensing deal and it disappears, or it's suddenly not in your iTunes library anymore. Or your hard drive crashes. Or you can't find it online at all. You can listen to the CD where you want, when you want, and when you tire of it, you can sell it back.
Three, there will be a CD resurgence one day, you know there will. It might not be as drastic and fantastic as the vinyl resurgence, but I'll bet it'll be stronger than the cassette revival.
Our friends at Zia Records in Las Vegas and Phoenix referenced the Best Buy story online and called out "We will keep selling CDs as long as you keep buying them." Our sentiments exactly.
August 11, 2017
Hey! We have a follow-up for you. Hopefully you read our piece two weeks ago, a response to a Wall St Journal article touting the beginning of the end of vinyl. We took issue with their reporting, and we liked it so much we made it our first blog post.
To recap, the article claims that since vinyl sales are up only 2% in the first half of the year and because some records are mastered off of CD files, that people are fed up with the inferior quality of vinyl and it’s thankfully now in decline, soon to die for good. Wow, what a take, right? We gently debunked that in our own way in our blog, so we’re not going to do it again here.
Apparently, we weren’t the only ones who felt the article needed debunking. In fact, the writer has been accused of making up facts and quotes to support his anti-vinyl position. Michael Fremer at Analog Planet, one of the subjects interviewed by the WSJ writer, blasted the piece as blatant fitting the facts to fit your own narrative, which it obviously was.
What’s great about being in the indie record store business is that we don’t put up with a lot of crap. When someone in the media has something negative to say – which has happened all too many times in the last decade or so – we’re not afraid to get up on our soapbox and occasionally be annoying in response. But it’s so totally worth it.
A couple of years ago, we started having customers ask “what are you going to do when they stop making CDs?” The first couple of times, this struck us as odd but misinformed and totally out of left field. But it kept happening, so something was clearly in the air. “Oh yes,” we were told, “I heard the record companies announced they’re going to close their CD pressing plants.”
“News to us,” we replied, “as well as to everyone we know at the record companies!”
It turns out that someone somewhere in the blogosphere did, in fact, write a piece claiming with certitude that CD pressing plants were officially going to be killed. Somehow this got picked up as fact and got tossed around at various news agencies.
But then an enterprising soul went and tracked back to the original writer of the piece, and pressed him on it. And guess what? The guy admitted making the whole thing up!
So you see what we’re up against here?
What I think we’re running across is inevitably someone’s internal bias unconsciously (or not) influencing his job performance. We all do it, right? Most young journalists’ frame of reference today is the digital download. A good chunk of folks in the 25-35 age range today grew up not having any reason to know record stores existed. But we’ve been witnessing a change in the last several years, that of vinyl re-entering the public consciousness. And it’s a big deal to the youth of today.
So hopefully another 10-15 years hence, young journalists will have grown up listening to vinyl, articles about our industry won’t be so condescending and negative, and we’ll have a little wind behind our sails for a change!
Last thoughts on this – We told you so!
July 28, 2017
Got a minute?
We have something on our mind. It’s about vinyl, vinyl sales, and media criticism.
A decade or so ago when a bunch of record store people got together and dreamed up Record Store Day, it was all about the narrative the media had an autopilot for years – “no one buys CDs anymore, record stores are dead, and good riddance to the old days.” That type of thing was reported so commonly, it became accepted dogma. Except it wasn’t true.
We were able to change the conversation. Not only are record stores alive, they’re important community gathering places and a lot of fun. And once that message started permeating, people started figuring out that vinyl’s pretty darn cool, sales skyrocketed, one thing led to another and here we are today.
Back where we started. The Wall St Journal published a piece this week entitled “Why Vinyl’s Boom is Over”. I’ve seen it referenced on social media several times already, generally with a quip like “See, I knew vinyl was a fad, it’s finally dead, good. Oh, and I’m not a hater.” I have a rule that arguing with a fool = two fools arguing, but it’s really hard not to challenge obvious poor reporting and errant conclusions drawn.
Ok, let’s start with the title. Why did the WSJ report the “Boom is Over”? Because Nielsen (Soundscan) reported vinyl sales up only 2% over the first half of 2017. Now, I can’t not mention that Soundscan doesn’t poll most small indie stores, which has been responsible for a lot of the run-up in new store openings and sales growth, and their data has been a source of skepticism for some over the years as a result. However, how dim do you have to be to read “Boom is Over” and infer that to mean sales are declining? An increase is an increase. I can think of several industries that would be thrilled with a 2% increase. And oftentimes declines in growth are simply reflecting a necessary repositioning of the marketplace and give air to future increases in growth. We see this all the time in the overall economy.
But the article itself wasn’t so much about vinyl, as it was about Gillian Welch and David Rawlings reissuing their 2011 album “Harrow & the Harvest” on vinyl and making sure to use the original analog tapes and quality equipment. We absolutely applaud this effort, and lots of other artists and labels make sure to do the same. It’s true, and it’s a damn shame, that some vinyl pressed today is sourced from the digital tapes. Which totally defeats the purpose, and we generally look at the practice with a healthy amount of disdain. However, in some cases, analog tapes no longer exist or are not in good enough condition, so it can’t be completely avoided.
We can argue it all day, so there’s not much point, but there is no freakin’ way that the slowdown in vinyl’s growth is due to customers growing tired of poor quality vinyl as a result of using digital source material, as the article suggests. It also cites high prices, and that is very likely a factor. There are always multiple factors in constant play, and it’s all too easy to draw an overgeneralized conclusion. Price does matter; we’ve heard it from you, we’ve passed it along to the labels, and the labels are starting to get religion about it. Plus, with more and more pressing plants coming online, we hope the added competition will drive down the cost of manufacturing, which will ultimately trickle down to the consumer. We’ll have to see.
But hold the phone a minute. The Wall St Journal did another article about vinyl on June 29th, wherein they say “Vinyl is experiencing a renaissance as younger music lovers embrace the perceived warmer, more vivid sound —and the more tactile connection to music than digital downloads offer.” Not even a month before the Gillian Welch article.
So I’m confused. Is vinyl experiencing a renaissance, or is the vinyl boom over? I don’t think it can really be both.
But anyway. Who really reads between the lines? Most people are inclined to see the headline and assume the worst if there’s any negative at all. “Oh, the boom is over, I knew it was too good to be true. It was a fad after all, just like Beanie Babies and the Shamwow.”
Ok, hold that thought. Let’s move over to another respected financial publication, Forbes. They reported in January that 2017 vinyl sales are projected to reach 40 million, with sales hitting 1 billion for the first time this millennium, and we will see a seventh consecutive year of double-digit sales growth. Regardless of whether this comes to pass, would you agree that if we’re even in the ballpark of $1B in sales, that’s way beyond the level fads generally reach? It’s all in how you report it, isnt’ it?
Vinyl is no more a fad than CDs were – their heyday lasted just a short 20 years or so – or the digital download, sales of which are declining by double digits today after surpassing physical sales for the first time just 5 years ago. We’ll be the first to agree that the high-flying days of the 80s and 90s, when billions of albums and CDs were sold annually, are gone for good. Ain’t coming back. But vinyl has carved out a niche today that isn’t going anywhere anytime soon.
Oh, and by the way, don’t forget about the CD. Sales have been declining for years, it’s true, but in 2016 they still generated 104.8 million unit sales. Bet you didn’t realize CD sales are still way out ahead of vinyl! How can that be, all the press, love and attention vinyl gets? My customers are always surprised when I tell them CDs still outsell LPs for us.
Again, that’s what happens when you control the narrative. How easily we are manipulated by the headlines we read! Journalists tasked with reporting the story often aren’t careful enough to make sure you’re not going to leap to unintended conclusions. It’s entertainment, it’s a fluff piece, and we’re just going to report something different next month anyway, so who cares?
That really wouldn’t get my goat so much if there weren’t immediately faceless people out of the woodwork who call out “See, what did I tell you! It was a fraud all along.”
Anyway, believe what you want to believe. But we’re not going anywhere. The industry changes as it always has, and we’ll continue to adapt to it. But we have never gotten out of the vinyl business, even during the 90s and 00s, and expect to stay in it as long as we’re here. And we’re in the process of renewing our lease, so that should tell you something.