Part 5: The Recording Industry

Chapter 17

Start Thinking. . . How are the music charts (Top 100, Billboard

200, etc.) compiled? Who compiles this information?In what ways does market research impact

the music industry?

Chapter GoalsBecome knowledgeable about record market

research and how this research is used.Learn about the record charts—how they are

compiled and their impact.Identify record market segments through

analysis of stylistic preferences and the science of demographics.

Understanding the ConsumerIn previous decades

song + artist = music salesradio stations = label’s most relevant

“customer”Technology changed old ways

market research became more sophisticatednew distribution technologies

Music consumer research categories:1.sales surveys measuring unit sales2.consumer attitude research reports3.custom research

Research TopicsThe ChartsLists of most popular musicBillboard publishes most quoted chartsMost music categories

have their own chart

Research TopicsDemographicsCharacteristics of consumers = yardstick for

analyzing the marketplaceEnables efficient targeting of music buyers

mind-shift from traditional mass-market approach

Trick is to understand consumers and their behaviorminimizes marketing and distribution waste

Research TopicsDemographics

Research TopicsRecord CategorizationPrimary genre initially assumedCrossover recordingsPublic does not care about categorizationNew categories find new markets to exploit

Research TopicsRecord Categorization

Research TopicsStylistic PreferencesMusic in a state of constant development and

changeArtists need to transcend trendsSome trends are absorbed into culture

rap

Research TopicsChanging Research TopicsChartsDemographicsStylistic preferencesMusic consumption in new mediaCollege studentsPrice versus value

Data SourcesNielsen’s Broadcast Data SystemMonitors broadcasts Recognizes songs and commercialsDetects actual airplayPrevents false airplay reports

although not beyond manipulation

Data SourcesMediabase 24/7Logs airplayRanks music popularityProvides subscribers with analytic tools to

understand dataProvides other programming elementswww.ratethemusic.com

Data SourcesMediaguideCatalogs music on commercial, non-

commercial, and Internet radioVerifies that radio commercials actually runGenerates charts ranking music popularityASCAP uses Mediaguide to more accurately

apportion royalties

Data SourcesMusic XrayQuantitatively analyzes new recordings

evaluate marketplace appealpoints out possible tweaks to improve sales

potentialProduces numerical snapshot comparing new

songs to past hits

Data SourcesNPD GroupProvides consumer information on industries

within media/entertainmentPays attention to consumer activity at POSInterviews customers to discover attitudes

Data SourcesRingScanA Nielsen serviceCompiles mobile ringtone sales data

Data SourcesSoundScanOwned by NielsenTabulates unit sales of recorded music

physical products and downloadsSales tabulations offered on a subscription basisOld system before SoundScan:

sales figures estimated and returns not accounted for

certain genres ignored in sales listssubject to manipulation

Data SourcesWeb-Based ResearchDigital realm = fertile ground to stealthily

track consumer activityConsumers operate over 1 billion Internet

devices globallyAudience tracking firms set up big consumer

samples

For Further Thought. . . How has SoundScan changed the accuracy of

reporting of unit sales of recorded music?Name six topics of music industry research.How can an understanding of consumer

demographics improve the marketing of music?