The good times are back for the music industry based on the latest results from the BPI and Entertainment Retailers Association. Geoff Taylor, BPI and BRIT Awards chief executive, has applauded the 2017 performance of labels and artists. While streaming is delivering for the biz, there’s still uncertainty about the future of the physical business. In the latest issue of Music Week, ERA CEO Kim Bayley has words of encouragement – here we quiz her further about the state of the business…
Your figures showed a 42% increase in streaming sales – how do you explain the leap?
Streaming is becoming more mainstream, more people are going into the streaming market, you’ve got things like voice-activated speakers which are giving an older generation a really easy way to get into these services as well. So I think it’s simpler for people and they’re doing more of it. I think it’s a combination of good release schedules plus innovation in technology.
Physical singles sales were up 28% last year – does that show the extent of the vinyl revival?
That’s the Record Store Day effect where there’s quite a large number of 7” and 12” singles that come out as part of that, so I think the vinyl resurgence has a knock-on effect in the singles and albums market.
With CD album sales down almost 10%, are you confident labels will continue to back the format?
I think physical has been really resilient and you can’t just look at CD in isolation. It’s about CD and vinyl combined, and obviously if you’re in that physical market, some people that were buying CD may have switched back to vinyl, some are obviously doing a bit more streaming. I would say that’s a result you would have expected; I don’t think it’s a massive slowdown. It’s also dependent on the type of releases that do really well in any one year. In another year, you may get an act that appeals to a different demographic, which pushes the physical percentage a bit more, so I don’t think it was a bad result overall.
How comfortable are you with the overall physical decline in sales of 3.4%?
The value is down less than the volume, so I think that’s probably quite a healthy place to be in the sense that values per CD or vinyl are holding up quite well. The difficulty facing retail is that they have invested a huge amount of time, energy and money expanding the distribution network and putting music into more outlets. So the number of outlets is at an all-time high but obviously that affects margin and the number of titles in each store – trying to get that balance right is going to be important.
Based on these results, what are your hopes for the year ahead?
My hope is that people don’t get complacent, and they don’t celebrate and think everything is wonderful. I think we are still quite a long way off the peak in terms of the value of the market and what you need to do is capitalise on the growth we’ve had so far, not take the foot off the gas pedal, but continue to innovate, continue to collaborate between retailers and record labels to keep the momentum going.