Customer-Friendly Strategies for Fixing the Music Industry's Woes
By George Colombo, Apr 5, 2004
It's come to this: The music industry's trade association is now regularly and, apparently randomly, dragging its customers into court. Defendants include young teens and their parents, senior citizens, and representatives of every demographic in between.
The industry claims that it's trying to protect its profits from piracy but you don't need to be a marketing expert to understand that any industry that maintains a chronically antagonistic relationship with its customers is never going to be profitable. (Want proof? Look at the dismal performance of the airline industry.)
Of course, piracy is wrong and there's no question about the fact that some individuals abuse digital music technology (although it's curious there doesn't appear to be any obvious relationship between someone's level of abuse and the industry's willingness to take him or her to court). Even granting all of that, however, the industry's steadily declining profitability can be traced to a number of different causes and it's not clear at all that music downloading is the most significant.
If the music industry wants to rejuvenate its performance and repair its relationship with its customers, there are a number of strategies it can pursue that would be far more effective than a legal assault on the very customers it needs to embrace. Here are five customer-friendly prescriptions the industry would do well to consider:
Want to Sell More Music? Then Release More Music. It's instructive to note that the Beatles' entire recording career took place in just a seven year span between 1963 and 1969. Contrast that with the rate at which artists release new music today, a pace that's somewhere between sluggish and downright constipated.
Adding insult to indolence, it's not uncommon for labels to try to foist a "greatest hits" collection on an artist's fans after just one or two original releases. If the public isn't buying much music, perhaps it's because the labels aren't releasing much music the public wants.
Bring Back "Grass Roots" Music. The music business and the broadcast industries are joined at the hip. As a result, the shortcomings of one produce serious problems for the other. Beyond the public policy issues that surround the massive consolidation of the broadcast industry, it's obvious that tightly controlled, corporate-approved play lists have choked off any opportunity for the sort of grass-roots phenomena that used to occur regularly in the music business.
Gary Glitter, a minor star of the 1970's, had his only major hit, Rock & Roll (Part 2), when an industrious and creative disk jockey started playing the "B" side of an otherwise uninspired release. That sort of serendipity could never happen today. Don't the record labels understand that broadcast conglomerates are stifling their industry? (And, by the way, isn't the Internet an ideal prescription for this problem?)
Insist That Radio Stations Identify Songs and Artists on the Air. This is another area in which the practices of the broadcast industry aren't helpful. Until satellite radio becomes ubiquitous with its digital readouts, listeners remain dependant on disk jockeys to announce the names of albums, songs, and artists.
In the music business's explosive past, those sorts of announcements were made regularly, perhaps even too often. But if yesterday's DJs were intrusive, at least customers knew what they were listening to…and what to buy…when they walked into a store. Record labels ought to insist that their songs and artists be identified each time they're played.
Sell Music, Not the Plastic. Over the years, I've bought every Beatles album several times in a variety of different formats: vinyl, cassette, and CD. (Yes, I even bought them on 8-track!) Every time I bought the same album in a new format, I paid the same price as someone who'd never purchased that music before. The industry contends that its pricing is based on the costs associated with artists and their music, not manufacturing costs.
That's a fair point but it's contradicted by the industry's practice of double- and triple-charging when an album is re-released in a new format. A more customer-friendly approach would be to charge repeat customers only for the hard costs of the new medium, not re-charge them for music they've already bought. Instead, the industry gives the appearance of gouging its customers by forcing them to buy the same music over and over again. Taking advantage of customers is always counterproductive in the long term.
Join the Twenty-First Century. The music industry is expending a great deal of effort trying to control the ways in which technology proliferates. Inevitably, that's a losing battle. It puts the industry on the wrong side of history and, more importantly, places it at odds with its customers who are embracing new technologies as quickly as they emerge. An industry that is so closely associated with creativity should be leading the way into the twenty-first century, not desperately clinging to the past.
The formulation for the "big picture" is simple: An industry cannot sustain itself over the long run when it is structurally aligned against its customers. The music industry needs to stop seeing its customers as adversaries and criminals. Instead, it must figure out ways to meet its customers' needs even as those needs change with the advent of new technologies. Then everyone can get back to what we ought to have been doing all along…enjoying the music.
George Colombo is the author of three books, including his most recent, Killer Customer Care: How to Provide Five Star Customer Service That Will Double and Triple Your Profits (Entrepreneur Press, 2003). His checkered past includes a stint doing record promotion in New York. And, of course, he is an inveterate Beatles fan.
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