Don't let it get away!
Keep track of the stocks that matter to you.
Help yourself with the Fool's FREE and easy new watchlist service today.
The popularity of free digital music has an ever-strengthening hold on the music industry, and album sales are suffering as a result . Looking at the colossal amount of units sold by a handful of lucky musicians, however, you’d never know anything was amiss.
Some artists are getting creative in order to get people buying their albums -- like, oh, Beyonce, for instance. As the entire world knows by now, she took to iTunes last week to unveil her latest “visual album” on Friday the 13th. Without any prior marketing campaign, Beyonce’s self-titled album is already seeing massive sales. All that hoopla around an album is incredibly rare, of course, and it leads one to wonder: is a gimmick the most effective tactic for an album to make money?
All hail Queen Bey
After simultaneously announcing and releasing her new album on Friday, Beyonce caused nothing short of a social media frenzy. Hysterical posts from fans proved to be just as effective as any kind of promotional ads or appearances -- the album sold over 550,000 copies in just two days .
What’s helping sales even further is the fact that on iTunes (the exclusive outlet for buying the album until Dec. 20), users only have the option to buy the album in its entirety, for $15.99, instead of purchasing individual songs.
In an interview with NPR, Jason King, a professor at the NYU Clive Davis Institute of Recorded Music, explained that this example of “anti-marketing ” is “very much in line with what's happening right now in marketing, which is this idea of marketing without marketing, or anti-marketing, where you appear to be just delivering your product directly to the consumer… like a direct gift.” As it turns out, not even Rob Stringer, the chief of Columbia Records -- which has signed Beyonce -- knew about plans for a secret album. Just days earlier, Stringer had been quoted by Hits Daily Double as not expecting her next album until 2014.
Anti-marketing has clearly paid off for Beyonce, but one wonders how the album would have performed without this extreme kind of non-publicizing. In 2011, her last album, “4” only sold 310,000 copies within the first week, a sharp drop from the 482,000 sold of the previous album, 2008’s “I Am… Sasha Fierce.” After the dust settles on Beyonce’s latest selling mania, she might have to work even harder to come up with an inventive promotional strategy (or pointed lack thereof), just to keep up that momentum.
Lady Gaga and the Amazon
Beyonce’s not the only artist to have used an unusual stunt to sell a lot of records. In 2011, Lady Gaga (who coincidentally partnered with Beyonce on the 2010 mega hit, “Telephone”) released her hugely anticipated sophomore album, “Born This Way.” Second albums notoriously see a slump in sales, and to avoid that, Gaga did what she does best -- got creative.
During its first week, the entire “Born This Way” album was sold on Amazon.com for just $0.99. This, of course, led to astronomical unit sales -- “Born This Way” sold 1.1 million copies within its first week, making Gaga’s sophomore effort a resounding hit (and shutting down Amazon’s servers in the process). That kind of epic promotional effort might have looked great for Gaga, but Amazon reportedly took quite the hit for it -- according to Billboard Magazine’s calculations , the e-commerce giant lost $7.40 for every $0.99 version of “Born This Way” purchased. Multiply that by 1.1 million and it starts to look a little sticky.
Gaga and her team outsmarted the ever-weakening record industry (at least in terms of units) that time around, but fast forward to November 2013. Her third album, “ARTPOP,” once again landed at No. 1 on the Billboard top 100 during its first week, but only sold 258,000 units, after being promoted in a completely conventional way (perhaps unusual since we’re talking about Lady Gaga). While still technically a No. 1 hit, those lackluster sales will reportedly lead to a loss of $25 million at Interscope Records due to promotional costs. The low numbers have also led to rumors that job cuts could be on the way at the record label.
When the Adele effect flops
One artist who seems miraculously immune to declining record sales is Adele. The British singer's most recent album “21” was such a mega-hit that it was hailed by news sources as solely responsible for boosting overall record sales in 2011 by 1%, the first year of increase since 2004 (also known as “the Adele effect”). With that kind of success in this age of music, you’d think Adele could only accomplish it by unicycling around the country setting fire to the rain, but the monster sales were attributed completely to her autobiographical, universally relatable songs of heartache, and her incredible voice.
Turns out, that’s not something that can be faked, or even replicated. Following in Adele’s lead, Britney Spears just released “Britney Jean,” describing it as her “most personal album yet” with several songs supposedly written about the painful demise of her own relationship. Emotional vulnerability did not lead to high sales for Spears -- “Britney Jean” only sold 107,000 copies within its first week, the worst performance of any Britney album ever.
While the record label that signed Britney, RCA, had the second highest market share of the record industry (12.2%) last year, these numbers still aren’t good to see. For reference, Britney has sold fewer copies of this album in its first week than her very first, when relatively no one knew who she was. Columbia, which houses both Adele and Beyonce, held 9.7% market share as of last year, but after the Beyonce obliteration, those rankings could change.
Has Beyonce conquered the record industry?
Of course not. Whenever she releases her next album (and yes, that’s like talking about the would-be next president immediately after someone has been elected), she will have to face the same struggles as Lady Gaga and Britney before her, in trying to get consumers to pay attention and shell out money.
Creativity and gimmicks may be more important than ever in getting a record to sell, but for consumers, it’s fun to watch artists work at outwitting the system. However, it does suggest that the record companies themselves need to become more aware of effective marketing tactics in the digital age. After all, if artists like Beyonce have more success promoting the album themselves (or consciously refusing to promote it), her self-sufficient success could minimize the point of being on a record label at all.
Time to make money
Millions of Americans have waited on the sidelines since the market meltdown in 2008 and 2009, too scared to invest and put their money at further risk. Yet those who've stayed out of the market have missed out on huge gains and put their financial futures in jeopardy. In our brand-new special report, "Your Essential Guide to Start Investing Today," The Motley Fool's personal-finance experts show you why investing is so important and what you need to do to get started. Click here to get your copy today -- it's absolutely free.