UMG To Experiment With Lower CD Prices
March 18, 2010 at 4:28 PM (PT)
The UNIVERSAL MUSIC GROUP is about to cut CD prices to $10 or less in an experiment to see if that would re-ignite consumers interest in CDs. The NEW YORK TIMES reports that the trial, which is expected to launch in the ne few months and last through the end of the year, will include a random sample of the label’s new releases and involve most of the country’s major retailers.
Deluxe versions of albums, which have extras songs or features, will continue to sell at its current price.
UMG distribution chief JIM URIE told the TIMES that CD sales had doubled at stores involved in a much more limited test of the pricing strategy. "It seems pretty obvious to us that a dedicated fan will gladly pay for extra content, for deluxe versions," he said. "But the casual fan isn’t willing to pay $15 dollars for a regular CD."
HASTINGS ENTERTAINMENT CEO JOHN H. MARMADUKE preicted that the lower prices should increase sales volume by 30% or more. "I think that $10 and below is the magic price," he said. "Lower prices are something that consumers and retailers have been asking for years."