Streaming Leads to Three Times More Sales Than Radio, Study Finds…

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Taylor Swift is all over FM radio.  But should she be?

Not according to the Country Music Association (CMA), who found that people who discover music while streaming are three times more likely to buy that music than traditional AM/FM radio listeners.  The study focused on listeners over the age of 18 across a range of streaming services, including Spotify, YouTube, and Pandora.

But daddy, what’s a ‘music purchase’?  Welcome to the future of the music business — you know, the one you’re living in right now.  Perhaps music analyst Mark Mulligan captured the tectonic shift best when he noted that discovery and acquisition have now become the same thing.  So, for example, when someone discovers something on YouTube, that music has already effectively been acquired.  More and more, that person doesn’t want to download anything, doesn’t need to hold anything physical, and most importantly, doesn’t need to pay anything.

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Enter Taylor critics like Dave Grohl, who argue that getting people to listen to — and engage — is the most difficult challenge.  In that light, the study also found that half of those who discovered music they liked through streaming did further research on that music, including Googling the artist and searching for lyrics.

By extremely stark contrast, just 17% of AM/FM listeners did the same.

 

Written while listening to Walk the Moon.

42 Responses

  1. Anonymous

    “But daddy, what’s a ‘music purchase’?”

    Funny question. Millions of kids buy music — just look at Swift, Cyrus, etc.

    A lot of middle-aged people still like streaming though, but they’ll come around when their favorite artists disappear from Spotify…

    Reply
    • jw

      You are so fucking out of touch.

      What are you basing any of this on except for willful ignorance?

      Reply
    • GGG

      Your other go-to messiah, Beyonce, has her extended edition LP up on Spotify now. Uh oh.

      Reply
      • Anonymous

        I think you missed my little crash course in windowing. Here it is again — you may want to pay special attention to the last paragraph:

        “Most acts sell most of their music during the first weeks and months after release.

        Now, if you give your songs away during this critical period, you will suffer a certain amount of cannibalization (people don’t buy your music because they can get it for free without breaking any laws). Nobody knows the exact ratio, but you would lose money even if it were as low as 1 to 100 (it takes 100-140 Spotify streams to balance the loss of 1 sold song). And nobody claims it’s that low.

        So a lot of smart people thought about this for a while and the smartest among them — people like Adele, Coldplay, Black Keys, Taylor Swift, Beyoncé and their teams — realized that windowing was the way to go:

        Windowing comes in all shapes and sizes, but it generally means that you keep your property away from Spotify, or similar services, during the most critical period in the lifespan of a record — and that you make it available on these services as soon as sales begin to drop.

        Reply
          • Anonymous

            “I had no idea windowing existed”

            No, you made that clear in your Beyoncé comment.

          • GGG

            I like how your argument, every day, day in day out, is “Yes! Artists should stay off Spotify altogether! It’s the devil! The Black Keys are off, Taylor Swift is off, blah blah blah!” And then as soon as someone points out that you’re wrong, you paste the same douchey windowing comment.

            That’s why you’re a tool.

        • Anonymous

          Your opinion – which you provided exactly no evidence to support – is directly contradicted by the results of the survey mentioned in this article, which would indicate streaming customers are MORE likely to purchase music not less

          How can you (and Paul, who did the exact same thing) be this willfully ignorant? It hurts my soul to see people being this fucking stupid, pls stop

          Reply
    • Streaming = Piracy

      isn’t it funny how the same arguments used to justify streaming are the same arguments used to justify piracy… it’s promotion, increases sales, etc – begs the obvious question if streaming is responsible for so much more sales, why are sales dropping… time for the adults to wake up, no half baked, propaganda financed “survey” can out run math…

      http://thetrichordist.com/2014/10/09/who-will-be-the-first-fired-label-execs-over-spotify-cannibalization/

      let the heads roll…

      Reply
  2. Irving Mindreader

    For fuck sake, have we lost all capacity to discern between correlation and causation now? This ‘study’ compares behaviors between disparate consumers, as if ‘professional truck drivers buy more tires’ were a revelation.

    Newsflash: Engaged consumers (e.g. streaming vs terrestrial radio) are more engaged consumers. In related news, water is wet.

    Move along people. Nothing to see here.

    Reply
    • People Against the Worship of Taylor Swift

      Digital Spy: What do you think of Taylor Swift’s decision to pull her music from Spotify?

      Dave Grohl: “Me personally? I don’t fucking care. That’s just me, because I’m playing two nights at Wembley next summer.

      I want people to hear our music, I don’t care if you pay $1 or fucking $20 for it, just listen to the fucking song.

      Reply
      • Name2

        Uh, yeah. I can read the article myself.

        The question is: Does “I don’t care” make him a Taylor Swift critic?

        Reply
        • GGG

          It’s barely critical, if at all.

          DMN has just adopted Taylor Swift as their lord and savior now.

          Reply
          • Anonymous

            which is frightening, she looks and acts like a 12 year old….

            thieves…

  3. Anonymous

    “More and more, that person doesn’t want to download anything, doesn’t need to hold anything physical, and most importantly, doesn’t need to pay anything.”

    Apparently, streaming customers *do* want to download & buy physical formats, because statistics show they’re about 5 times more likely to do it than a terrestrial radio listeners. But who needs statistics when you can just pull opinions out of your ass am I right?

    Great article

    Reply
    • GGG

      Ehh, as much as I’d love to use this data I agree with you to an extent. But also, YT and even Pandora are far more popular than Spotify. In other words, PLENTY of non-overly-engaged users use those two services, so there’s still a tiny bit of correlation here I’m sure. It’s not like they just asked Spotify subscribers, who are probably far more active in music consumption.

      Reply
  4. Name2

    Taylor Swift is all over FM radio. But should she be?

    You know what would help answer this question? A grasp of raw numbers of radio listeners and raw number of users of those named services.

    Maybe 7.5% of radio listeners IS a better deal than 25% of streamers.

    Denominators: How do they fuckin’ work?

    Reply
  5. Casey

    “Taylor Swift is all over FM radio. But should she be?”

    Sure. Why not? A major artist like her has nothing to lose from being on FM radio. FM radio played a key role in her success.

    Reply
  6. TruthSeeker

    Holy Sh|tballs, you’re dumb, Paul.

    First:
    Irving Mindreader – For fuck sake, have we lost all capacity to discern between correlation and causation now? This ‘study’ compares behaviors between disparate consumers, as if ‘professional truck drivers buy more tires’ were a revelation.

    Newsflash: Engaged consumers (e.g. streaming vs terrestrial radio) are more engaged consumers. In related news, water is wet.

    Move along people. Nothing to see here.”

    Second:
    “…three times more likely to buy that music than traditional AM/FM radio listeners.”

    Followed by:

    “But daddy, what’s a ‘music purchase’?”

    Um, it’s BUYING the music (not “acquiring an experience” through YouTube), you JUST said that, you absolute moron….

    Reply
  7. A

    What I did not like about the article are the bar charts, because they put things in an absolutely wrong perspective. the second chart compares 50% to 17%. But since the chart starts at 10% it looks as if the percentage of Spotify users is 4-5 higher than the radio users, whilst it is just 3x if you compare the real numbers (and use a chart that starts at 0%). For people who have no idea about maths this could be very confusing.

    Reply
  8. derby

    Does anyone on this site listen to Taylor Swift? It’s absolute middling pop music with about zero staying power. I don’t begrudge her millions of fans and their passion for her music, but aren’t we talking about mostly young girls – young girls who in a few years will move on to better, much better, music?

    All this harrumphing over Taylor Swift. I just wish it were a different artist in the middle of this discussion.

    Reply
    • Q

      That’s so amusing. She is a manufactured pop/country singer (like so many before her) which will be considered obsolete in about 5 years (just because she is a woman in the pop genre, just ask Britney, I don’t like that but that is the reality for most of the female pop singers).

      Some people here are against streaming and taking her as their savior, but the reality is that music is perceived as cheap by the consumers because of musicians that cannot perform live and whose studio recordings surely use tons of auto tune.

      Why should I go out and buy the album of someone that cheats to sound nice on their songs? IMO that is also a great factor in the decline on music sales.

      Reply
  9. JAIO

    Poll: how many of us arguing have children or grandchildren? Do you watch their behavior? Do you follow the behaviors of their friends? Are you interested in what a 14-18 yrs listens to or how? How bout your college aged 18-24 yr? Guaranteed the post-college set buying behavior historically has dropped to the lowest among nearly all demographics. 25-44 is not a prime buying audience. Both the recorded music sales, and the number of live music events they attend, drops off significantly. 45-64 is a very viable physical product market (hence the bump in AARP pushing such).

    Radio is predominately a 25-54 play. The really big play is moms with kids in the 10-16 range. They don’t buy music as a general observation. What music they access is on the car radio. Terrestrial FM radio is still the dominant music acquisition method in automobiles. Next to that is iTunes. If anyone in the family is on the cutting edge of new tech, it’s the kids themselves… especially 12-14 yr olds who are discovering the “world” for the first time. What are your 14 yr old boys listening to? How are they accessing it? How bout the tween 11-13 yr old girls, and their mom’s? If mom is 38, she may listen to NPR, but more likely is listening to the current Adult Contemporary, or Modern Country station. She may buy a physical cd at Target or Walmart, but is now of the age when going to a record store is a memory from college 14 year ago, and iTunes is now her primary point of purchase.

    Taylor Swift’s visage in pop culture is extraordinarily large. Every move is carefully calculated based on risk assessment. Whatever she does is scrutinized with our microscopic criticism. But I think it’s more important to look at the broader trends and question a few things.

    If who we’re talking about is the act that can sell a couple thousand cds at clubs and summer events, what is the impact of using Spotify? That act is not going to make any money from using them, or Soundcloud, or Bandcamp etc. We’ve all been made painfully aware of that “fact.” So the benefit of using Spotify, etc, is the benefit of blind discovery: if people don’t know what they don’t know, they cannot find you, right? So blind discovery is the hope of any of us who put stuff up online.

    Think about how we adults actually “discover” music. The most common customer discovers music accidentally. Radio, family, friends, associates, happen change experiences … Pandora, iTunes radio …

    When we consider the debate based on TS, we have to make a different set of assumptions, based on her socially wide popularity. The same goes for Dave Grohl. They’re superstars. People pay attention. We are not, and only a few thousand may pay attention to us.

    Reply
  10. Willis

    Sure it does.

    84% of all stats are only correct 27% of the time, according to 60% of analysts.

    Reply
  11. Philljsmith

    The fact is that Radio is filtered by music directors and music programmers and streaming services are not, yes there are playlists etc but Radio adds about 8 new songs to rotation a week which is a lot less then streaming services, and with Taylor Swift being a powerhouse in the industry and pop culture she’s almost guaranteed to be added to heavy rotation (8-10 times a day).

    Taylor Swift pulling her music from Spotify was a good idea for her because she’s already surpassed “critical mass” in terms of marketing, getting lost in a pool of every day artists doesn’t make sense for her, yes it would help everyone else on the service but not her or anyone else playing in her league.

    Streaming is the future for the upcoming generations but radio at the moment is still king, streaming listeners may be three times more likely to buy then radio listeners but artists still have to be found in a pool of so much music. This will change of course, as playlists and people that manage them will become more and more important, the job of the Radio tracker will expand to include relationships with online music curators and playlist managers and not just radio music directors and music programmers, radio will of course have it’s place with personalities providing local gossip and news but it won’t be as important as it is now. But before any of that happens, above all else, streaming needs distribution, because at the end of the day that’s what radio is, distribution, until streaming services are seamlessly integrated into the car the way radio is then streaming will never take over radio.

    Reply
    • Anonymous

      “Streaming is the future for the upcoming generations”

      No, facts show that the model failed:

      1) Artists leave.
      2) Millions of kids buy records because it’s the only legitimate way to get the music they love. Audio-only streaming services are museums today and teenagers don’t want last week’s hit.
      3) Audio-only streaming services lose money 24/7.

      Time to move on.

      Reply
      • GGG

        A model failing (whether I agree or not) and ‘streaming’ failing are not the same thing.

        You really see streaming as dead, while literally every other industry that exists in any small way digitally moves in some degree to cloud storage? I mean, if this is the case then you lose any tiny credibility you had to begin with.

        Reply
  12. JeffreyBarkin

    It’s important to appreciate that this U.S. “Research” features only a sample of 1,600 18+ Adults during an eight (8) day period in mid-July. The study reveals that terrestrial radio is still the NUMBER ONE source for music discovery; AM/FM Radio had 43% share…http://buff.ly/1vZy0i9

    It should also be noted that the major labels, who have equity in most streaming services, and the radio broadcast industry, are both well represented on the CMA Board. This “Research Report’s” release could not have been better timed, less than two weeks following Taylor Swift’s recent media missive against unpaid music streaming broadcast performance.

    Streaming needs to pay better, too; as music creators and performers should be financially rewarded for their work. The digital distributors and broadcasters make billions through ad revenues off the backs of the creative performers we enjoy. Shouldn’t we collectively strive to make the future of the music industry more financially attractive and viable? Do we want to promote an industry dictated by broadcasters with reality shows selecting “winners” covering others? For every struggling artist still striving, how many have already have quit or packed it in because the survival picture is so bleak? Should it be this bleak, is the REAL point? Can’t there be better compensation royalties and mechanisms?

    In a related situation… it’s a SHAME that terrestrial radio in the U.S. pays NO artist performance royalties; unlike all other democracies on the planet.

    In the same month, Spotify announces losses in the millions [while its UTorrent co-founder CEO enjoys an estimated personal wealth of over $200 Million]; YouTube has refused to properly pay performance royalties on its music broadcasts [or to remove requested owners’ content (Irving Azoff), despite litigation threats]; while the Chairman of the Music Business Association (formerly NARM) is YouTube’s music product manager [Fred Beteille] with its Mission “to advance and promote music commerce”.

    What a WONDERFUL WORLD…!!!

    Reply

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