Shrinking Physical Space Boosts Independent Digital Sales

Independent artists are experiencing elevated digital album sales levels, thanks in part to shrinking physical retail inventory.

Just recently, The Shins (Sub Pop) scored a second-place finish on the US-based album charts, a result that included strong digital album sales.  Overall album sales for the group totaled 119,000, of which 35,000 were digital.  Those percentages are increasingly common for independent artists, and shrinking floor space at big box retailers will further the trend.  “A lot of physical accounts will not take the records,” Nettwerk chief Terry McBride told Digital Music News during an executive forum in Park City, Utah on Tuesday. “A Wal-Mart or a Target won’t bring more than a thousand titles,” McBride continued, while noting that “retail footprint is going away”.

That echoes sentiments expressed last week by Yahoo Music chief David Goldberg, who pointed to a similar effect at mega-retailers.  “Once CDs stop drawing people in, there’s less reason for stores to keep large collections on their floor,” Goldberg said during a digital music conference in Los Angeles last week.  Other events, like the disappearance of Tower Records, will exacerbate the situation.  Elsewhere, smaller stores are also feeling the squeeze, and fewer mom-and-pops means less opportunity to sell discs.  The result, according to McBride, is heavier traffic online for less-than-blockbuster content.  “Kids can’t find the record, so they go online,” the manager said, while pointing to subsequent jump in both legal and illegal transactions.  Ironically, that could cause independent artists to further deemphasize physical retail campaigns, a trend that will continue to boost digital sales percentages.