March 23, 2016 |Music Notes Blog
Vinyl (Still) Rocks \m/
Now that our 2015 sales numbers are out, there is one category that continues to befuddle even the most astute industry observers: vinyl (in a good way, of course). So if you’re one of these observers or a casual music fan doing some research on this waxy format (or both), we thought we’d offer up a few of our own observations about vinyl to help inform the numbers.
First off, to be sure, vinyl remains a niche, but it’s not insignificant. It continues to be a major bright spot for the industry. Revenues from vinyl albums were $416 million in 2015 – the last year they were that high was 1988! Think tube socks, Nintendo game systems, ‘Coming to America’, George Michael, Tiffany, and so many other priceless gems.
Another interesting factoid? For the second year in a row, vinyl revenues are higher than the revenues the industry receives from the billions of streams on ad-supported, on-demand services like YouTube, free Spotify, and others.
Our CEO has offered up some reasons behind this trend here, but let’s keep our focus on vinyl. Vinyl albums were just 6% of the overall retail music market (by value) in 2015. Small, but not insignificant. And as a percentage of physical revenues, that number shoots to 21%.
Looking at the top-selling vinyl albums in 2015, it’s clear that vinyl sales come in all flavors, from classic rock to the newest pop hits. The best-sellers included pop sensations like Adele and Taylor Swift to classics like Pink Floyd, The Beatles, and Miles Davis, and even alternative crooners like Sufjan Stevens and the group Arctic Monkeys. This wide variety of genres speaks to the diversity of vinyl buyers and helped fuel the strong sales numbers we see today.
So what’s behind the numbers? Many people ask us why vinyl is having such a resurgence. It’s tough to pinpoint just one reason. Vinyl fans, like all music fans, come in all shapes and sizes. We know that for some, owning vinyl is a way to connect with their favorite music and artists in a more direct and tangible way than digital media. Why NOT pick up a vinyl album at the merch booth at your favorite band’s concert – you love the music! Plus it’s a cool collector’s item that music enthusiasts want to own. Record labels are always looking for ways to connect fans with music, whether through cutting edge technology or classic, vintage formats like the vinyl record, and do their best to keep stores like Urban Outfitters and others fully stocked. Further, some audiophiles love the way vinyl sounds, and prefer it over digital formats – where else can you hear the classic warmth of a record playing on a turntable? Sometimes it’s just the best way, depending on your mood. But for others, part of the appeal are the digital codes available on some vinyl albums so you can also have it for your digital collection. A clever two-birds-with-one-stone marketing technique that’s convenient for fans. And similar to the Case Logic collection of CDs in the ‘90s that you showed off to your friends, a large collection of vinyl albums can say a lot about a person’s identity and passion for music.
What’s also interesting to us is that the resurgence of vinyl runs counter to general industry trends, which have been weighted more toward the growth in streaming and digital formats and away from ownership. The vinyl boom bucks that trend.
Finally, it’s worth noting that this year’s Record Store Day, which the industry has promoted and has always been a wildly successful day celebrating the vinyl format, is Saturday, April 16th. There are so many cool promotions around this day, not to mention in-store concerts at both big shops and mom and pop record stores throughout the country. It’s worth checking out! We’d note that this year’s Record Store Day ambassadors are Metallica, which makes sense – historically, a lot of vinyl purchasers tend to skew heavily toward rock and alternative music. So yeah, we’ll say it – VINYL ROCKS. Enjoy!
Josh Friedlander, SVP, Strategic Data Analysis
Cara Duckworth Weiblinger, VP, Communications