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Don't eat your children

Filed in archive Marketing by Marc on March 9, 2006

Don't eat your children
Record labels continue to experiment with release timing by distribution channel. The industry continues to use radio as promotion to build later CD sales. So where does digital fit?

It depends on what child you're trying to save. Do you release the digital single with radio? This approach lets your youngest and most promising digital child thrive and fights back the big bad P2P wolves. But it may cannibalize CD sales.

Or do you wait to release digital with the album to maximize CD sales? This strategy saves your chubbylinks oldest child. But it neglects the digital baby and invites higher P2P downloads.

This New York Times article covers a case of the later. Here is an excerpt:

As blockbuster hits go, the R&B smash "So Sick" is hardly new territory for the 23-year-old singer known as Ne-Yo. Before crooning the song on his own album, he was a co-writer on the 2004 chart-buster "Let Me Love You" for the singer Mario.

But there's one big difference: even though fans could hear "So Sick" on the radio for the last two months, they couldn't buy it at popular online services like iTunes or Rhapsody, or anywhere else for that matter. Breaking from the music industry's current custom, the singer's label - Island Def Jam - decided not to sell "So Sick" as an individual song before Ne-Yo's album hit stores last week. Label executives worried that releasing the track too early might cut into sales of the full CD - a fear that figures heavily in the music world's lumbering entry into the digital marketplace.

The results of fans' pent-up demand for Ne-Yo are now clear: his CD "In My Own Words," burst onto the national album chart yesterday at No. 1, with sales of more than 301,000 copies, easily ranking as the biggest debut of the year so far. And just as eye-popping: the digital single of "So Sick" sold almost 120,000 copies in its first week, according to Nielsen SoundScan.

There is still plenty of debate over the effect of holding off on sales of the digital single; many also note that Island Def Jam offered a discount to retailers who stocked the album, allowing it to sell at stores like Target for $7.98 last week.

But if the industry determines that restricting digital sales pays off with bigger album sales, fans may soon find the instant gratification of snapping up new songs online becoming a little less instant.

No one is talking about a wholesale shift away from the now-common practice of selling singles online ahead of new albums.

But even before Ne-Yo's big debut, some music executives fretted that they were offering too many songs too early, particularly from pop and R&B acts.






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