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[email protected] mpresley@earthlink.net is offline
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I came across this article about the retail music business and I think it
fits in with some of the recent discussion here.

http://www.prospect-magazine.co.uk/a...ls.php?id=9735

From the article:

There is a story doing the rounds in the US that says a lot about the state
of the music business. It concerns a young rock band who decided to stop
selling their CDs at concerts. Selling CDs has, for many years, been a good
way for an act to reclaim the margin that would otherwise have been
snaffled by a retailer. But it made no sense to this band once they
discovered that by selling CDs for $10 they were cannibalising sales of
their $20 T-shirts...
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BEAR BEAR is offline
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wrote:
I came across this article about the retail music business and I think it
fits in with some of the recent discussion here.

http://www.prospect-magazine.co.uk/a...ls.php?id=9735

From the article:

There is a story doing the rounds in the US that says a lot about the state
of the music business. It concerns a young rock band who decided to stop
selling their CDs at concerts. Selling CDs has, for many years, been a good
way for an act to reclaim the margin that would otherwise have been
snaffled by a retailer. But it made no sense to this band once they
discovered that by selling CDs for $10 they were cannibalising sales of
their $20 T-shirts...


Sounds like, ummm... something less than a "truthful representation"?
Perhaps a story "planted" for the benefit of one of the protagonists in
the endless music biz fighting.

Why? Because you have to ask *what the margin is on each product*!!

They almost certainly make more *margin* (profit) on the CDs of the concert
than they do on the T-shirts!

Spec the costs on both, you might see that the T-shirt is surprisingly expensive,
and costs money to cart around besides.

I strongly suspect that the MOST profit can be had by selling *both*, not one
or the other.

Therefore, my suspicion about the source of the article remains.

_-_-bear
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[email protected] mpresley@earthlink.net is offline
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bear wrote:


Sounds like, ummm... something less than a "truthful representation"?
Perhaps a story "planted" for the benefit of one of the protagonists in
the endless music biz fighting.

Why? Because you have to ask *what the margin is on each product*!!

They almost certainly make more *margin* (profit) on the CDs of the
concert than they do on the T-shirts!

Spec the costs on both, you might see that the T-shirt is surprisingly
expensive, and costs money to cart around besides.


Hard to say since I don't sell either. I did a quick Google and took the
first two companies that came up. 1000 t shirts at $3.43/unit vs 1000 CDs
at $1.44/unit. If the CD sells for $10 while the shirt sells for $20 then
the profit on the shirt (per unit) is twice that of the CD.

Does a stack of shirts cost more to lug around than a stack of CDs? Beats
me.

I guess the idea is that the kid is not going to buy the CD anyway, since
he's already downloaded it (or appropriated the files from a friend).
Better to sell him a t-shirt that he can wear later and as he listens to
the music he's stolen from you.

mp
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jwvm jwvm is offline
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On Aug 8, 7:26 pm, "
wrote:

They almost certainly make more *margin* (profit) on the CDs of the
concert than they do on the T-shirts!


Spec the costs on both, you might see that the T-shirt is surprisingly
expensive, and costs money to cart around besides.


Hard to say since I don't sell either. I did a quick Google and took the
first two companies that came up. 1000 t shirts at $3.43/unit vs 1000 CDs
at $1.44/unit. If the CD sells for $10 while the shirt sells for $20 then
the profit on the shirt (per unit) is twice that of the CD.

Does a stack of shirts cost more to lug around than a stack of CDs? Beats
me.


Actually, its possible to get 1000 CDs made for under $.90/unit
including shipping. I know someone who prints custom shirts and they
are a pain to drag around since they easily get dirty and take up a
good deal of display space compared to a CD. It is also necessary to
carry a variety of sizes. With CDs, one size fits all and the shrink
wrap protects them pretty well unless they are dropped. CDs can also
be placed in nooks and crannies in a car or van without damaging them
so they are more efficient to carry.

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jwvm wrote:


Actually, its possible to get 1000 CDs made for under $.90/unit
including shipping. I know someone who prints custom shirts and they
are a pain to drag around since they easily get dirty and take up a
good deal of display space compared to a CD. It is also necessary to
carry a variety of sizes. With CDs, one size fits all and the shrink
wrap protects them pretty well unless they are dropped. CDs can also
be placed in nooks and crannies in a car or van without damaging them
so they are more efficient to carry.


Actually, generally the CDRs are burned on the spot right after the concert!
So, the cost after the initial amortization of the burning gear is quite
low per CDR. They are selling the show you just saw...

_-_-bear
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