News

We've heard the sad tales from the record labels and distributors about their ever-weakening music sales, but there are other players in the market who are also feeling the pinch: retailers.

In an effort to understand what is going on and to seek out solutions, the National Association of Recording Merchandisers (NARM) organized the first-ever Music Retailing Summit in Chicago last month. NARM's Pamela Horovitz explains, "We organized this summit with two goals in mind: First, to give distributors and suppliers a better understanding of the retail point of view on the issues of the day and, second, to engender the kind of communication that will allow the entire industry to work toward realistic partnered solutions."

NARM reports that more than 100 key executives from the retail, wholesale, distribution, and record label sectors attended the event. During the conference, four key objectives were developed, designed to "return the music industry to positive growth trends." These consisted of a commitment to the re-introduction of singles into the marketplace, more inclusion of retailers and wholesalers in the growing digital distribution segment of the business, new value propositions for consumers, and additional consumer research.

To get their message across in a series of six separate meetings, members of the NARM Retailers Advisory Council delivered presentations to representatives from Warner Music Group, Sony Music, EMI Recorded Music, Universal Music Group, and Bertelsmann Music Group, as well as representatives from independent distributors Allegro, Ryko Distribution, Navarre, and Koch Entertainment.

Horowitz says the overall theme of the summit was "Change is all around us, and we must change," with specific topics addressing the changes in marketplace dynamics as they relate to the consumer, CD burning and "copy management," the digital distribution of music, re-establishing singles in the marketplace, and "how to drive out costs and add value to music for the consumer."

NARM's David Schlang stated, "With the industry facing perhaps a watershed moment in its history, retailers wanted to emphasize how essential it is for all segments of the industry to be on the same page, so efforts and focus are positive and productive. Our next step will be extensive follow-up and on-going dialogue with participants to ensure that we as an industry do not go back to business as usual, but implement these objectives into reality."