Brief

Brick-and-mortar record stores stage revival

Dive Brief:

  • Brick-and-mortar records stores are not only surviving the digital music era, but finding growth opportunities to open many new stores nationwide, according to the Associated Press. The industry on Saturday celebrates its 10th annual “Record Store Day,” in which stores across the country hold music events and special releases.

  • After nearly 50 years in business, record store chain Tower Records shuttered in 2006, and the number of independent record stores dwindled to some 2,000 in the U.S. But in the past five years their numbers have grown again to about 2,400, Wes Lowe, an executive at wholesale CD, DVD and vinyl record distributor Alliance Entertainment Corp., told the AP.

  • Many of the stores are in smaller towns, and much of the business is driven by a resurgence of vinyl record sales, according to the report. Vinyl album sales have risen from annual sales of fewer than one million in 2005 to more than 13 million last year, according to Nielsen Music research cited by the AP.

Dive Insight:

The endurance of independent record stores is akin to the survival of independent bookstores, which have similarly survived two decades of disruption from Amazon. Their numbers, too, have increased in recent years; both bookstores and record stores have found ways to compete by hosting local events at stores and positioning store staff as helpful experts. Bookstores and record stores also benefit from the surprisingly successful and enduring “buy local” movement.

Indeed, some of those muscles were first tested by big-box retail, which well before the digital streaming era forced smaller stores to become stronger and more efficient, says Chris Brown, chief financial officer at New England record store chain Bull Moose. As the executive in charge of marketing, Brown was also one of the retail store employees who 10 years ago conceived of “Record Store Day” as an opportunity to demonstrate the value of brick-and-mortar stores as places to gather and shop. (Brown is also CFO at “lean retail” firm Fieldstack, which has made a business of algorithm-based commerce solutions first conceived at Bull Moose.) 

“The press was predicting doom and record executives were gloomy, but that wasn't our reality,” Brown told Retail Dive. “Independent stores resilient enough to survive big-box competition in the 1990s used those efficiencies to take advantage of the chaotic 2000s.”

Independent record stores had to find ways to persuade not only their customers to continue to shop there, but also the industry, like the distributors of music recordings on discs of all media, to take them seriously as retail players. Like bookstores, record stores have had to become more efficient — and wiser — when it comes to inventory, supply chain management and customer service.

“Our customers needed to know that we would always be there for them,” Brown said. “We also showed the music industry that indies worked business magic. Dealing with us had previously been like herding feral cats. Now we had a seat at the table.”

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