Thursday, November 15, 2018

How Millennials Are Changing The Music Industry | Music Think Tank

Millennials love music. We listen to 75 percent more music than Baby Boomers. What does the constant stream of music into millennial brains tell us about this generation’s relationship with the music industry?
 
When it comes down to it, millennials are completely altering the industry as we know it because of the quantity of music we consume and the technology we use to consume it. Millennials are consciously changing the industry as insiders, and we’re intentionally and unintentionally changing it as consumers. 

Millennials Are Disrupting Business as Usual

 

The music industry is a business that relies entirely on people’s shifting tastes and their use of ever-evolving technology. You can sum up the millennial generation’s impact on business in one word: values. Record labels sprout up quicker than ever because millennials will change jobs to find an employer that reflects their values, even if the new employer pays less. This explains the proliferation of tight-knit indie labels, where people come first.
Millennials are searching for purpose and asking the business world to put people before profits. In fact, in a survey of millennials, 67 percent said respectful treatment of employees is the number one factor when it comes to being satisfied with workplace culture.  
When it comes to values, many millennials are looking for businesses to put diversity and inclusion at the forefront. We are a social generation, a sharing generation, which makes sense because we were raised to value equality and sharing. In that sense, we don’t place a huge priority on possessions. We’d rather share experiences. This is a generation that loves experiences and prizes them over possessions. 
Furthermore, millennials are tech-savvy to the extent that it’s speeding up the level of technological innovation we’re seeing from companies. We view tech as a means to an end, the end being new experiences. This even effects where we live and move. Of the top cities for young professionals, San Francisco and Seattle are tech hubs where millennials are finding jobs, through which they can influence the technological landscape and be creative.  

The music industry is a prime example  

 

Millennials are walking a line with the music industry the likes of which the world has never seen: the line between destruction and creation. Keep these factors in mind: millennials value people and experiences, and we are open to changing the world with new tech.
Back when millennials were teenagers, two of them decided to completely upend the way people consume music. The service they invented was called Napster. “This system, what’s most interesting about it is, you’re interacting with peers, you’re exchanging information with a person down the street.” That’s a quote from Napster co-founder Shawn Fanning. Note that the millennial traits are fully on display in this quote. Napster allowed people to share the music experience with other people. 
Napster was technology that would change the world of music. Napster recognized that young people prioritize the music experience, and sharing it, more than owning a copy of the album.
Napster paved the way for streaming services. The makers of Spotify, Pandora, and other apps understood people want to listen to as much music as they’d like, streaming for free or at a minimal cost. 
   

Yet vinyl sales are surging

 

Even though millennials value the music experience and technology, our voracious appetite for music and authentic sources of music has led to a resurgence in the vinyl market. Because of used vinyl and indie record stores, vinyl sales are actually bigger than the official estimate

Officially, new vinyl sales reached 16 million units for a total of $395 million in 2017. However indie stores, which don’t report their data, and used vinyl sales, which are going strong, account for vinyl sales that are about 2.5 times the official reports. 
In case you’re wondering, the Recording Industry Association of America (RIAA) keeps the official tally, and it notes that “This is the first time since 1999 that U.S. music revenues grew materially for two years in a row.”   
Millennials’ massive music consumption habits are driving an increase in vinyl sales and an increase in overall revenue for the music industry.

Yet overall, digital has changed the way the industry works 

 

With Napster, millennials broke out of the traditional music distribution model. After Napster fell, streaming took the torch in a big way. In 2017, streaming services racked up 82 percent of the recording industry’s revenue.
Artists don’t earn that much through streaming services, which is why indie labels are creating their own streams to try and tip the scales. Despite this, it’s still going to be hard for most bands and the industry that supports them to make good money through digital music. The format makes recorded music ubiquitous, and when a product is readily available at a minimum price, as a rule people aren’t going to pay more for it than they need to.
That’s why the live music industry and the live music experience is more important now than ever. I bet you’ve noticed the concert prices steadily rising, even for indie bands few people have heard of. Streaming is the culprit. If bands and labels can’t make much money on recordings, they have to make it through the live music experience, where they can also sell merch. 
This observation is backed by numbers. The BBC reports that “gig ticket prices” have doubled since the 90’s. It’s hard to find the numbers on small shows, but in terms of the big ones, ticket prices hit a record high in the first half of 2018.  
In conclusion, what have millennials done to the music industry? We’ve made it more about experiences than it ever was. The live music experience makes the most money for the industry, while streaming provides a music experience anytime, anywhere there’s an internet connection. For anyone out there reading this who wants to work in the music industry, be prepared to pour your heart into cultivating an experience and supporting artists who create the music. You won’t make a ton of money, but at least there’s a lot of joy to experience.  

 

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