In comparison with last year’s holiday season, recorded music sales revenue has decreased markedly. According to Nielsen SoundScan, volume sales of 1) albums (physical and digital) and 2) physical and digital albums plus track-equivalent albums (any ten digital tracks make another album) are down respectively by 17 and 13 percent.(1) SoundScan’s data, moreover, suggests poorer percentage growth performance for the holiday season than the entire 2007—which is alarming. Much less value was therefore earned by the business.
It is curious that Nielsen SoundScan summarizes the data as an overall 6.6% increase in total music sales compared to last year’s season (the holiday season starts the day after Thanksgiving and finishes at New Year’s Day.) (2) The figure takes into account videos, singles, digital tracks, digital albums, and physical albums. It is misleading, however, because SoundScan counts a single transaction as a unit sale, regardless of it being an album or a single track. As the market has shifted to single-track buying, there are simply more transactions registered!
Clearly, single-track sales have increased by 38%. (3) This data reflects change in the way music is being bought and sold, and its effect on the holiday season, but also alludes to the fact that there was a lack of new content for the consumer to buy. Further examining album sales this season, SoundScan provides data that shows chains, independent stores, and mass merchants all found a significant decrease in sales this season compared to last. Chains were hit hardest with a decrease of 31%. The “Non-Traditional” category, however, experienced a 15% increase in comparison.(4) Nielsen SoundScan’s “Non-Traditional” category includes digital downloads, Internet, concert venue, and mail order sales.(5)
To better understand why album sales were down and why non-traditional stores saw increases in sales, one needs to look at what was being released during the holiday season. The holiday season in 2006 saw 12 new releases during that time. Out of the 6 weeks of that holiday season, there was at least one album being released each week. In the holiday season of 2007, there were no new releases until the 5th week release of Mary J. Blige’s “Growing Pains.”(6) With only one new release, perhaps there was less incentive for the music consumer to buy from brick and mortar stores.
The top selling album of the 2007 holiday season was Josh Groban’s “Noel,” selling over 3 million copies. Groban’s “Noel” is also the first Christmas album to occupy the number one spot for five consecutive weeks.(7) Alicia Keys’ “As I Am” came in second place, selling 1.8 million copies. The Eagle’s independently released, Wal-Mart and website only comeback album, “Long Road out of Eden”, ranked at number 3, selling 1.3 million copies. The “NOW! That’s What I Call Music, Vol. 26” compilation came in at number 4. The only new release of the season, the previously mentioned Mary J. Blige album, “Growing Pains,” was ranked at number 7.(8)
The lack of new product, the shift towards digital downloads, and the rise in gift items such as iPods and laptop computers were all contributing factors in music sales changes from the 2006 holiday season. Because of changing consumer behavior, future holiday sales analysis may rely more heavily on measurements other than the traditional total sales figure.
Carlton W. Washington II
1 “Nielsen Music Flash: A Monthly Review (Holiday Season 11/19/07 to 12/30/07)” Nielsen SoundScan Pg. 1
5 “Nielsen SoundScan to Report Digital Download Music Sales”
6 “Nielsen Music Flash: A Monthly Review (Holiday Season 11/19/07 to 12/30/07)” Nielsen SoundScan Pg. 2
7 “Variety: Groban’s disc sells well despite industry slump”
8 “Nielsen Music Flash: A Monthly Review (Holiday Season 11/19/07 to 12/30/07)” Nielsen SoundScan Pg. 3