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Sampling Online And Off
October 22, 2010
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"It is the recommendation of the research team that online music retailers strongly consider using sampling to boost conversion rates -- especially in situations where mixed online reviews have the potential to create uncertainty in the mind of a prospective buyer."
-- From the report 'Does sampling influence customers in online retailing of digital music?'A whole lot has said about the pros and cons of online music retailers allowing or offering sampling to increase sales, so I thought I'd summarize here some of the findings in the above report I quoted from. ( http://tiny.cc/nqvix36yfm )
A) Sampling increases customer conversion rates by as much as 14%.
B) Sampling can have twice as much positive impact on conversion rates as reviews.
C) Sampling substantially mitigates the negative impact of mixed reviews.
From the report, "Conversion rates -- the percentage of customers who go from looking at a product to buying a product -- are critical for success in online retailing. It doesn't matter how many shoppers you bring to your site if you can't induce them to make a purchase. On the other hand, if you can convert a high percentage of site visitors, you can drive higher revenue with less traffic. In fact, some researchers have concluded that a 1% increase in conversion rates can result in a 50% increase in revenue."
And more: "Amazon, iTunes, America Online, and FullAudio all offer free legal sample downloads (typically 30 seconds in length) that are of the same quality as their actual products. Challenges associated with sampling include selecting the right portion of the music file to sample and the cost of maintaining and delivering sample files. Given these two choices for addressing customer uncertainty, the question facing online music retailers is whether it is better for their business to use one or the other -- or both."
I don't think anybody dealing in the marketing of digital music would be surprised by this information. It just reinforces the fact that "tasting" what you might buy, before you actually fork over your money, is the smart way to go. (That's why every food company in the world has people giving free samples away at your local grocery store -- Costco, etc.)
In the golden days of brick-and-mortar music retailers, you couldn't walk in to any store and not hear music playing all the time. I can't remember all the times I was in Tower Records on Sunset in West Hollywood when something I heard being played caught my ears, I found out what it was, and in most cases, took it home if it piqued my interest. If it "tasted" good in the store, I couldn't wait to get it home.
That's what a lot of the new vinyl stores, which are opening up in a new city every day, are doing again today. They're creating an environment filled with music so their customers are constantly sampling unconsciously. They know that "the longer they play (the music), the longer the stay (the customers)" ... and hence a better chance of getting them to buy something.
Of course, the greatest sampling device ever created was the Internet. More people have the chance to listen to more music (new and old) online than anywhere else. A lot of people blame the Internet for the decline in physical CD sales because it has enabled people all over the globe to do exactly that.
But those same people have purchased 10 million Lady GaGa albums, 10 million Taylor Swift albums, almost three million of Eminem 'Recovery', two million-plus of Lady Antebellum. Millions of Justin Bieber albums. And so on and so on and scooby-dooby-dooby.
Maybe the Internet and "sampling" added to those sales.
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THE 'A-SIDE' - TRACK 2
THE LEE ABRAMS THING
If you haven't read any of the media hoopla about Lee Abrams leaving The Tribune Company, or if you don't know who Lee is, then just go directly to the next piece in the newsletter.
I must admit I was not surprised to read about the clash in corporate cultures between the old Tribune regime and the team Randy Michael's assembled, which included Lee Abrams. I believed strongly there was just no way any rock'n'roll culture and progressive thinking about new media would ever go over in an environment where once upon a time, print journalists and their mastheads were considered the media elite. Forget the fact that the corporate and internal management thinking at almost all these once great companies is mostly outdated, and that newspaper circulation (like network TV news ratings) is declining year over year. Even the New York Times can't stop their declining profits and circulation.
Of course, new thinking and new vision is needed at all these companies, but it sure looks like most newspaper corporations are sadly disconnected from the people they need to reach via circulation to stay in business. In many cases, the lack of forward thinking at newspapers parallels in many ways the same lack of vision the record labels had when the Internet became the media of choice. Oh yeah, and all the problems with declining circulation (and declining physical CD sales) can't be blamed on the Internet alone.
There's a myriad of reasons for both ... and too long to elaborate here.
Lee will go on to his next challenge and bring the same enthusiasm for new media with him wherever he goes.
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THE 'A-SIDE' - TRACK 3
BASIC CABLE IS CHANGING TV AND THE WAY ITS MADE
As the big four major TV nets struggle with declining viewership, hidden in the higher reaches of the TV remote, prime-time cable series like "Drop Dead Diva," "Army Wives" and "Sons of Anarchy" are reinventing the way TV is made. For years, the few original scripted shows on basic cable were considered the industry's minor leagues. Now, as the media landscape changes and viewers flock to shows they like wherever they air, the basic cable universe keeps expanding, attracting better talent and growing in vibrancy.
This proves yet again that traditional network thinking is driving people to cable. Summer reruns and bad shows? Nope, the audience goes to cable. Reruns of Leno, Letterman every night? No way, I'll go to cable.
Once the province of reruns and sports, basic-cable networks will spend an estimated $23 billion on 1,462 original programs (including reality shows and specials), compared with $14 billion on 863 shows in 2005, research firm SNL Kagan reports. With no expensive pilots, few Hollywood sound stages (they often shoot in regional locations), no affiliated local stations to placate and very little corporate feedback, these shows operate in a parallel universe. They're a safe haven for those weary of the broadcast model, which hasn't changed much since the 1960s. Read about it all here: http://tiny.cc/ha07z
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THE 'A-SIDE' - TRACK 4
APPLE REPORTS ALL-TIME HIGH EARNINGS
Buoyed by the near-doubling of its iPhone sales from a year ago, Apple on Monday reported record revenue and a 70% jump in fiscal fourth-quarter earnings.
Read about it here: http://tiny.cc/mq5vs
And Now For Some News ...
Profile Of A Great Songwriter: Diane Warren
WALL STREET JOURNALA terrific article about one of the most successful songwriters of our time (and one of the nicest people in the entire music industry), Diane Warren.
Read more about it by clicking here.
Hollywood Studios Once Owned Part Of Netflix; They Sold It Way Too Soon
THE WRAPYup, you read that headline right. It isn't only record labels that make mistakes when it comes to paying attention to new media.
Once upon a time the major Hollywood studios all had a piece of Netflix.
The other major studios followed, but all of them unloaded their shares a year after the IPO.
Read more about it by clicking here.
20 Banned Album Covers
BILLBOARDLady GaGa might have gotten a lot of media coverage about the meat dress she wore at the MTV Awards, but when it comes to meat, The Beatles beat her to the punch.
Back in June, 1966, The Beatles released the 'Yesterday & Today' album with the now infamous "butcher block" cover with cuts of meat and cut-up baby dolls. It was quickly removed from the marketplace and replaced with a boring generic shot of the Beatles. (If Capitol re-released the original cover today, the press would probably say The Beatles were photo-shopped to capitalize on what Lady GaGa did!)
Here are 20 covers that were banned and replaced at retail right-quick: Poison, David Bowie, U2, Guns'n'Roses, Bon Jovi, Blind Faith, The Black Crowes and Jimi Hendrix, were just some of the artists who had to switch covers to satisfy record retailers.
Read more about it by clicking here.
SoundCloud Ready To Stream Music
MEDIA MEMOAs if the streaming music space wasn't crowded enough, another startup named SoundCloud is about to secure "significant" backing. Media Memo reports that Index Ventures and Union Square Ventures will lead a round for the Berlin-based streaming music service. Sources tell MediaMemo that VCs have been competing "fiercely" to get in on the three-year-old company, which has already raised $3.3 million from Doughty Hanson Technology Ventures. Why, when, as MediaMemo notes, "online music has been a black hole for investors for a very long time."
For one, SoundCloud isn't dependent on deals with the major music labels. Rather, it encourages professional and amateur musicians to share their own music with each other and with the public via cloud-based files. Presently, the service is offered free to most users, while it charges up to $700 a year to those who more storage and premium features.
Read more about it by clicking here.
ReverbNation Buys SoundAround
BUSINESS WIREReverbNation, the provider of an online marketing and promotion platform, announced on Tuesday that it has acquired Sound Around, a mobile application developer focused on musicians.
The acquisition will enable ReverbNation to extend its comprehensive set of tools for bands and musicians to include the creation of mobile applications for its user base. Details of the transaction are not being released.
Read more about it by clicking here.
Apple Wants To Kill The Web?
THE UK REGISTERWith only a touch of sarcasm, Mozilla exec Mike Beltzner is accusing Apple and Steve Jobs of conspiring to render the Web obsolete. "I wonder when Apple will stop shipping Safari," Mozilla's director of Firefox development tweeted this week, following Apple's "Back to the Mac" event. "It's obvious already from today's keynote that they're looking to bypass the web." What's motivating Beltzner's attack?
Read more about it by clicking here.
The New MacBook Air
CNETCNET reviews the new 11 and 13-inch MacBook Air models.
Read more about it by clicking here.
ATTENTION MUSIC PUBLISHERS : Claim Your Royalties Today!
If you are a music publisher who owned or administered musical works between 2007 and 2008, you may be entitled to receive royalties under Group II of the NMPA Late Fee Program, a program to distribute pending and unmatched funds owed to publishers by major record labels.
To learn more go to www.NMPAlatefeesettlement.com or call 1-866-249-8110
MAD MEN AUDIENCE GROWS.
This past season of AMC's "Mad Men" was the highest-rated to date, and ratings increasing over 25% from last year.
GOING MOBILE:
AT&T activated more than 8 million smartphones during the third quarter of 2010, including 5.2 million Apple iPhones -- a quarterly record for the company.
JACKSON ALBUM DELAYED:
The collection of unreleased Michael Jackson songs that was originally set for November is now "in limbo," as the co-executors of the Jackson estate and producers brought on for the project continue to work on demos Jackson recorded in 2007. The compilation will reportedly feature outtakes from Jackson's "Invincible" album and not his earlier releases.
APPLE HAS ANOTHER GREAT YEAR:
Apple ended its fiscal year with revenues of $20 billion and profits of $4.31 billion, a 70% boost over last year, and a record for a single company. Apple revealed that iPhone sales nearly doubled year-over-year, to 14.1 million over the latest three-month stretch.
WE ARE MORE WIRED THAN EVER:
The International Telecommunications Union (ITU) predicts that by the end of the year, 2 billion people will be online, an increase of 600 million in just the past year and double the number of only five years ago. The total number of mobile text messages sent globally is set to top 6.1 trillion. (Much text ado about nothing.)
PUMPKIN NEWS:
Billy Corgan and his Smashing Pumpkins will release "Teargarden by Kaleidyscore Vol.II: The Solstice Bare," the second EP in Corgan's planned 44-song, 11-EP project, on November 23rd. The limited edition CD and 12" vinyl will feature "The Fellowship," "Freak," "Tom Tom" and "Spangled," plus the unreleased B-side "Cottonwood Symphony."
BETTER THAN THE STOCK MARKET FOR SURE:
A copy of the White Stripes' 1998 7" single for "Lafayette Blues," one of only 15 copies with a hand-painted cover by Jack White and Italy Records head Dave Buick, was recently sold for $18,000. The single originally sold for only $6 when they were sold at the Stripes' concert at Detroit's Gold Dollar in 1998.
HACKERS SAY KISS THIS TO SIMMONS:
Gene Simmons' outspoken comments about punishing illegal downloaders have made him the target of a hacker or hackers who took over Simmons' official website this past week.
KEITH A PIRATE AGAIN:
Keith Richards will once again cameo as Captain Teague, the father of Johnny Depp's Captain Jack Sparrow, in 'Pirates of the Caribbean: On Stranger Tides', which is scheduled to hit theaters next May.
REM COLLAPSES:
R.E.M. have decided to call their 15th studio album "Collapse Into Now."
U2 GETS MOUSE:
U2 are recording a new album with Danger Mouse, and they plan on releasing early next year.
C'EST LA VIE:
Transportation concerns stemming from a refinery worker's strike in France have forced Lady Gaga to postpone two concerts from this weekend. The shows will now happen in December.
SURPRISE, SURPRISE:
Last week, Yoko Ono, in an interview in in England's Daily Mail newspaper, said that Paul McCartney and his wife Linda. at one time, helped talk to her about John and their reconciling. She also says that Paul actually flew to Los Angeles to talk to John about how to get Yoko back. You can read what she said here: http://tiny.cc/5al46
STARBUCKS YAHOO:
No, that's not a new drink. Starbucks on Wednesday announced the launch of its Starbucks Digital Network, a joint venture with Yahoo that will offer news, entertainment and lifestyle content for free exclusively in Starbucks stores.
The Music Industry Past, Present & Future, And The Internet I answer questions on EconTalk
I did an interview about the industry and the Internet at EconTalk with host Russ Roberts. Russ is also a professor of economics at George Mason University, blogs at Cafe Hayek, and has written three novels that teach economics. He's also the co-creator of the Keynes-Hayek rap video. (And if your understanding of the economic meltdown that occurred needs to be enlightened, this video will do it)
In the interview we talk about the evolution of the music industry, the impact of the digital revolution, and I give my reasons for believing in the virtues and potential of the Internet in enhancing the music industry. I point out, as I have many times here in the newsletter, that the internet allows numerous artists to make money from their music and it can enhance revenues from live performances by expanding an artist's base. We also discuss the challenges facing record companies and I suggest that the full potential of the Internet as a distribution channel has yet to be fully exploited. There's a lot of ground covered, but based on the comments already posted of those who have tuned in, they've enjoyed it.
Read more about it by clicking here.
Quotes of the week
"I'm a parent. I have daughters. I don't cuss. I mean, how would I really sound ... walking around my house [saying] 'B---h, pick this up,' you know what I mean?"
-- Eminem, on watching his language at home, to 60 Minutes. Well gee, Em, sure we know what you mean. You'd sound just like yourself on many of the tracks on your albums."I don't have the best body in the world, but I know for a fact that I have a really good voice."
-- Ke$ha, responding to critics who doubt her singing talent, to Seventeen magazine. The follow-up question: With or without the use of Auto-Tune?
The B-Side - 'Blips'
THE ONION (www.theonion.com) STORY OF THE WEEK:
Bored Entertainment Media Decides To Go After Ray Liotta With All They've Got
HOLLYWOOD, CA-Citing a general feeling of boredom, as well as a lack of anything better to do, members of the celebrity news media announced this week that they have decided to put all other stories on hold and use every resource at their disposal to go after veteran film and television actor Ray Liotta.
"It's been kind of a slow month, so we figured, 'Hey, how about we harass the ever-loving shit out of Ray Liotta for a while?'" Star magazine editor-in-chief Candace Trunzo told reporters at a press conference Monday. "So that's exactly what my publication and every other celebrity news organization in the country is going to do. We're going to pin this son of a bitch down, pop 3,000 flashbulbs right in his eyeballs, and make every waking moment of his life a living hell."
Read the rest here and laugh: Click Here.
The Blogs
Check out Jerry Del Colliano's (the founder of INSIDE RADIO) daily blog, by clicking here: http://www.insidemusicmedia.blogspot.comWebsite
Check out attorney Ray Beckerman's website at: http://recordingindustryvspeople.blogspot.com where he prints news about the RIAA's ongoing activities
Smart Marketing Consulting Services
Smart Marketing Consulting Services has been in business sixteen years, and consults clients in the music, entertainment, attraction, media, and technology industry on branding, marketing, online exploitation, maximizing new media, and more.
"And the beat goes on, the beat goes on ... drums keep poundin' rhythm to the brain."
"Work is life, you know, and without it, there's nothing but fear and insecurity." -- John Lennon
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