music stores

here's an interesting look inside the music store industry written by one of the co-founders of Newbury Comics.

i've known for a while that the brick & mortal (talk about your freudian slip...mortar is what i meant) stores were under increasing pressure to increase sales. and you see that with Newbury Comics where when i moved out here 8 years ago (fuck that's a long time...) there was much less emphasis on DVDs or toys, but those are far more common in the stores now.

i still believe that the RIAA is wrong about the "decline in sales" that they talk about. yes, there is a decline in sales on SINGLES. you know those CD5's you'd get? for the old timers, a 7" 45rpm record that needed a plastic insert? that's what has been on the decline over the last few years. actual CD sales are pretty steady these days (tho when they were first flying this flag, it was on the increase). sure file sharing (Napster, Bearshare, and the like) helped create the decline in sales of SINGLES, but like most people, i used those services to see if i liked something and if i did, i'd buy the CD. that pretty much still holds true, which is why CD sales aren't as affected by this leveling off. what's affecting these retailers is the overhead. 50,000 sq/ft is fucking HUGE. and i think that's where Newbury Comics is managing to keep pace with the larger chains, because they have smaller spaces, carry a more specialized stock, and have lower prices. is it any wonder that it cost you $18 for a CD at a store in the mall? i'm sure mall rent ain't cheap. nevermind Newbury Street.

i'm digressing. i'm still sad that they closed the store near where i live now, but i understand why. i'm sure that when i entered the Black Period of my life, my income that they had grown to depend on vanished, so they were forced to close the store. i still like going to their stores, and i figure i've been to at least 2/3 of them, and bought at least something at most of those. these days i don't go as often, but more because a lot of what i want i either have, have replaced, or are no longer interested in. plus there's this impending purchase in the next year that's going to pretty much kill any real chance of spending money at their stores.

anyways, i spose i should copy the thing in here because it will eventually go away. so here it is in case the link dies as links are wont to do. it's a good read anyways, and it's a pretty funny tale about them and Tower Records.

A Message From Mike

Thoughts on Tower Records and Virgin Records Closing

The end of '06 is truly the end of an era for music retailing in New England. Whatever one's view is of brick and mortar retailing, napster, ipods, wal-mart, target, best buy, customer service, or even if you just have fond memories, the landscape will never be the same.

VIRGIN

Virgin Records has announced the closing of their massive backbay store on November 4th. This was somewhat expected, but not so soon. The store never really resonated with mainstream music customers, the way the original backbay Tower store did in the same location, many years ago. Virgin is an awesome brand. Richard Branson is one of the few folks I really, really look up to in retail. I have a picture of him and I on my office wall....

I remember visiting one of the original Virgin Megastores on Oxford Street in London in 1979-1980. The had a separate comic book room! They sold shrunk wrapped T-shirts, they had poster displays, they even had a snack bar. But most importantly they had a MASSIVE assortment of LP's. Huge racks as you walked in, with HUNDREDS of the same title in a rack. Branson knew how to make a statement. Truly impressive. Newbury Comics followed in Virgin's steps in a small way.

But times have changed. It's very hard for any entity to pay Newbury Street rents for 50,000 square feet of mainly just CD's and DVD's. So Virgin is closing in Boston. And with that closing goes dozens and dozens of jobs. Jobs of people who are passionate about music and film. The web isn't up to full speed yet, so there will be a large practical loss of accessibility of a lot of culture for a time...

TOWER

I first spoke with Russ Solomon, Tower Record's founder, when I was writing an editorial piece in Boston Rock Magazine in the early 80's. The New York Village Tower had just opened and had set the record world abuzz with it's massive assortment. Outside of London, nobody had ever seen anything like it!

Russ was charming and wise. A true visionary, who took a record rack in the back of his father's store all the way to a global brand. He was listed in Forbes Magazine as one of the richest people in America. He always has a sharp sparkle in his eye, and is a keen listener and observer. Has a completely understated "hippie" type class about him. We KNEW Tower was coming to Boston soon. And they came.

The day Tower opened in Backbay, our sales in Harvard Square dropped 25%. But Newbury Street instantly became THE place to shop for music. So we did okay. Tower brought excitement and media attention to specialty music retailing. They embraced media more than computers. We always respected the Tower folks and had a lot of fun competing against each other. We used to leaflet the hell out of 'em with coupons. They finally put up a sign that said "we accept all competitors coupons". Since their pricing was always a bit higher, they could get away with it.

But then one day we got this great idea to offer $5 off all CLASSICAL CD's. We only had a few bins of them at the time. They had a whole floor! About 3 weeks later we received a shipment from them that was a box full of THOUSANDS of our classical coupons, with a note that said "you win". They took the coupon signs down. When we renovated and expanded the store, they sent us some pizzas. Truly great people at Tower! The lifer's loved the company. And the company tried its best to take care of 'em. Kinda like Newbury....

The BANKRUPTCY

Tower's 2nd Bankruptcy is a complete disaster for the music retail industry. The ENTIRE chain is liquidating. That's insane! Unfortunately the high bidder at the bankruptcy auction was a liquidation company. So EVERY store is closing. Usually in a bankruptcy, some of the best stores are saved, or at least rolled into a competitor. Apparently not this time. Another company in auctioning off the real estate/leases so it is unlikely anyone will be able to put anything resembling the chain back together again. The toll will be very heavy on their staff, small labels, small distributors, and musicians who could always count on Tower to be open to their records. Tower always had its flaws, but this truly sucks. It's a bad outcome for way too many.

NEWBURY COMICS

We are still doing okay, but things remain challenging for us. Our sales continue to decline modestly. The closures of key competitors will not give us too much of a lift. The loss of small labels will hurt us. The mass merchants like Wal-Mart, Best Buy and Target are the ones who are taking away the most business. When HMV left Harvard Square, we barely felt it. Radio still largely sucks. We have gotten a lot more aggressive with our suppliers, and they have largely been very, very supportive of us. We have reduced shelf prices on about 3,000 titles in the past 3 months, and will be reducing prices on another 2-3,000 more CD's and DVD's as we continue to negotiate better trading terms with record labels and studios.

If you want to see specialty music retail survive, please continue to shop us!

cheers, mike dreese

co-founder - newbury comics

p.s. any comments can be directed to mike@newburycomics.com
(please do not reply to the address this was sent from, as i won't get it)