Posted by: Jon Fine on August 29, 2007
Just saw this post on coolfer.com where proprietor Glenn Peoples has been slicing and dicing SoundScan data in all manner of ways in an effort to further parse music sales trends.
Yes, said trends are bad. But one interesting thing he’s found relates to the withering of the mid-list titles—what he calls “the mid-tail”—as evidenced his analysis of the sales of the #200 album on Billboard’s Top 200 chart.
Writes Glenn (emphasis added:
To see the demise of the middle tail, one can look at the unit sales for the 200th best-selling album over the last three years. At this time in 2004, the 200th album was selling a bit over or a bit under 6,000 units. Two years ago, the 200th album was doing well over 5,000 units on a consistent basis. One year ago, a typical 200th album was doing about 4,500. This year, the 200th album often sells fewer than 4,000 units.
The downward-sloping trend line tells the story. A three-year decrease of 6,600 to 4,350 represents a compounded annual rate of decline of just over 13%. (I took those numbers from the trend line on the graph.) In other words, the middle tail’s rate of decline looks to be higher than that of total album sales. (Total album sales are down 15% this year and dropped 5% and 9% in 2006 and 2005, respectively.)
If the hits are not selling well, and the middle tail titles are hurting as well, I would have to come to the conclusion that the sales at the far end of the tail are the only ones faring (relatively) well. Middle tail titles are struggling to reach mid-level hit status while lesser known and older catalog titles enjoy the benefits of digital and online distribution.
I am going to have a hard time expressing this next thought so bear with me … This hollowing-out of the lesser-tiers of the industry is related to something I wrote about some time ago: the days of the critically-reviled, second-tier rock band—think Foghat, Grand Funk Railroad—that thrived in the shadow of top-tier acts like the Rolling Stones or Led Zeppelin, that notched platinum record after platinum record and sold-out-show after sold-out show, well, there’s not current analog for them in today’s market. The (few) acts that reliably go platinum are big stars—the journeymen of the biz can’t hope to come close to those kind of sales.
That metaphor, that hollowing-out of the middle, echoes what’s happening in Glenn’s post about the mid-list.
Meanwhile, in an email exchange in which he answered a key question about the peaks on his graph—more on them later—Glenn expounded a bit more about the shape of the yearly sales declines:
What I have found interesting is how sales level off at a lower level each january. Christmas brings lower album sales, I assume through higher ipod ownership. From jan to nov, sales are pretty level. Then after christmas, they level off at a lower level.
The question I asked him concerned the three peaks in his chart, which goes back to 2004. Simple answer: Those peaks are the holiday season.
Glenn also has up this follow-up post further plumbing his mid-tail thesis.
I’ll have more to say about music sales trends in my next column for BusinessWeek, and said column stems more or less stems entirely from a conversation I had with Glenn earlier this summer. Thanks, Glenn.