As we enter the last odd year of the decade, it's a good time to reflect on where we've come since 2000. That was the year I entered the music business, the one that marked the beginning of the slow but sure decline of CD sales and the conundrum of digital distribution. Noffin’ to do wiv me guv. I've bought more records in the past eight years than any period in my life and I expect quite a few mid 30's to mid 40's music fans would say the same. We've taken advantage of the increasing choice, increasing channels and falling prices. Meanwhile the vast majority of people under that age band have probably gone the opposite way, taking advantage of free music (legal, illegal, ambiguous) and cherry picking downloads from albums while finding a multitude of other sins on which to spend their money. For other punters, music's general ubiquity has probably negatively affected sales rather than the other way around. Record promotion just isn't what it used to be.
And the institutions in the value chain really are, finally feeling it. Retailers, right in the front line, first took one for the team and now appear to be going down like nine pins. Physical distributors, well they're all but done for. More worryingly, many market-leading digital music services are folding or making cut backs and lay-offs. But what about the record labels? There were some small indie casualties in 2008 (Gut for example), but nothing of real significance. Meanwhile the majors appear to be soldiering on.
But all isn't well, clearly. Overall sales figures tell only part of the story - total global trade value is down approx 6% in 2008, with the value of retail music sales now rapidly approaching half of what it was in 2000. The more telling indicators though, are the sales of individual 'blockbuster' titles, which are getting hammered. Universal dominates the blockbuster charts, but even its big guns in the final quarter – Razorlight, Snow Patrol and the three K's: Keane; Killers and Kaisers – all took disappointing yields despite good reviews. Those titles combined have racked up 1.7m sales to date in the UK (OCC figures) – not bad but probably not much above half those forecasted by the marketing teams, who are now left with deep scratch marks about the head. With all the chart markers down, but the business of selling music still costly, artist P&L's must make grim reading for the accounts men. Who on earth can call themselves a genuinely profitable long-term music venture in these days?
With just about every panacea turned to and from, where exactly do we go from here? More to the point, where are the visionary leaders that will take recorded music in a new direction? Who are the pioneers cutting new paths for artists just setting out on their careers making music? If you should shout these questions into the chasm, it’s pretty echo-y, isn't it?
Well, it seems to me there's nothing else for it. We need to call in Don Draper.
Come on now, you aren't asking yourself 'who the hell is Don Draper', are you? I'll bet you're not, but just in case, I'll fill you in. Don Draper is the Creative Director and recently promoted Partner, in Sterling Cooper, a boutique firm of advertisers in New York. In the 1960s. In a TV show called Madmen. So yes, strictly speaking, Don Draper doesn't actually physically exist. But Draper is such a brilliantly drawn fictional character that it really shouldn't stop us giving him a bell – or at least pretending to. For if we step into the Draper mindset, admittedly, not easy, it might be revealing.
The Draper Method
Firstly a quick tutorial. Draper is nothing if not thorough. He doesn't just take briefs, read the 'research report' (god I love Madmen) and brainstorm. No no no. Don 'lives with' his clients problems. He mulls them, ponders them, sometimes obsesses over them. He becomes them for goodness sake. In the Draper method, Problem Definition is everything - the root of any solution. But then comes the hard bit – the solution itself. Draper is first & foremost, a creative genius. He'll look at charts and matrices drawn up by his junior colleagues, but only in order to reassuringly, dismiss them outright. He's inclusive though. Like all good leaders, Don will ask around. He'll consult colleagues yes, but more critically, he will tend to ask those uninvolved and detached from the problem. He’ll ask his wife as they climb into bed with their good books. He’ll consult his mistresses over a post coital cigarette (we forgive Don all sins and infidelities btw, as he is genius and this is the 60s remember). He’ll even quiz complete strangers. He’s not looking for the answer directly. He just needs to bounce off his interlocutors on his journey to the answer.
It all takes time this, but then something occurs and it's this: The Miracle Happens. It might strike like a lightning bolt in the middle of the night, or it might ping into Don's Brain in the middle of a conversation, or it might simply rise gently to the surface. This is why clients call Sterling Cooper and ask for Don, and not go to the major agencies for cookie cutter, safe solutions. Draper gets to the truth of it, the heart of the matter. He's not simply a contrarian, so you can't try and second guess him.
However, since he doesn't actually exist, this is precisely what we will attempt to do, because the recorded music business quite simply, needs a miracle.
Don's Analysis of the Problem
Draper would quickly recognise the fundamental nature of recorded music’s problem – the downward spiral of devaluation: digital technology, piracy and music ubiquity combining to eat away at the notion of music as a luxury, and subsequently falling prices and margins.
Let’s start with the music itself. That’s where Draper would begin. Would he see issues here? Almost certainly. There’s no shortage of high quality new music (just turn off the radio and read any music blog!). That isn’t the problem. But new music just doesn’t last as long as it used to, vastly reducing artist life cycles and increasing risks for producers out of hand. Don would look at any number of breakthrough acts who had a successful 2008: The Ting Tings, Sam Sparro, Friendly Fires, MGMT etc. and he would worry about where they might be two years from now. That is a problem.
Draper would probably see music as two markets: New Music and Classic Catalogue. The old greats from the latter are literally timeless. They will sell forever. They can be re-invented over & over, like Dylan, Young, McCartney have only very recently. There is no gain whatsoever in commoditising the Classic Catalogue. However, the pipeline from New to Classic is thinner and more unpredictable than ever. It’s almost closed. Even deserved modern classics don’t have a shelf life of more than a few years, if they even achieve breakthrough in the first place. This is because of music’s proliferation and because of reduced consumer loyalty to any particular artist or genre.
Next, Don would consider distribution. He would almost certainly challenge the notion that the future of music is entirely, digital. In ten years+, digital has added no monetary value to music sales that hasn’t been lost from core products, a situation that is unlikely to be reversed. No institution built around selling products for dollars can survive from selling those same products for cents. Don’t press down the accelerator on commoditisation, he would advise. However, Draper would not be fool enough to ignore file-sharing (much as his instinct would want to do so. After all this is a man who insists his firm should drop ungrateful clients!).
Finally, he would meditate music’s customers. More fundamentally than supply-side issues of music creation and distribution, Draper would see that it’s the people, the audiences that are changing the most. In fact, audience habits are fragmenting so fast around the discovery, listening and storage of music that most consumers – critically those of the highest value to the business – are becoming confused themselves about what to do with the products on offer, if they know anything about them.
Don's Solution (sort of)
These changes in both supply and demand mean that it has become impossible for incumbent institutions to cope alone. It’s clear why new entrants into the value chain are those which make all the impact, for good or bad. The business manual says that when an industry’s core product is being commoditised, industry players must build new added value products or services around the core and at the same time, milk the cash cows and diversify, ASAP.
Draper appreciates this landscape isn’t easy for music producers – artists or labels. Everyone is already trying to do this, with patchy, limited success. Hence we have a land grab going on between labels, live promoters and artist management. But clearly, each of those individually isn’t good at doing everything – so this is counterproductive. The core product in music is still a song and if you’re lucky, an album of songs. That won’t change. What needs to change is the quality and care with which these are presented and packaged – both in terms of promotion, marketing, consumer information and product packaging. And much better cooperation between the partners involved in delivery to consumers. It all needs a good dose of Draper-like class. We can do so much better than this, he might say.
In the end, Draper’s solution is both easy and very difficult at the same time. What he wants, as a music fan himself, he thinks the people also deserve. Where do you discover great music? Don would not dream of listening to music radio, during the day anyhow. He doesn’t have that much time to read about music, so he lacks what others lack – a decent, concise filter to what music he might like. Don’s a busy man and can’t spend hours playing around with a recommendation engine that’s hit and miss. He certainly isn’t up for anything like social networking (in his case because he would expose himself to strangers from his mysterious past, but that’s another story).
What do you decide to buy? These days, Don hesitates to buy a CD in a plastic jewel case that is by design both faulty and environmentally unsound. Nor would he download a music song file of such poor quality that he couldn’t conceive of why he would want to actually store it somewhere for long term use. Nor would he subscribe to a music service which has every song, because why on God’s earth would he want access to every song?
Can you see where Draper might come from with the solution? If we respond to the forces of devaluation with reduced prices and offers of ever greater volumes, we are contributing to the downward spiral and our own eventual demise.
The examples of successful initiatives going the other way (quality not quantity) are what Draper would point for potential bigger, wholesale solutions. In the physical space we’ve had Radiohead’s £40 In Rainbows box set (no discounts there!). In radio, Bob Dylan’s phenomenal Theme Time Radio Hour. In music TV, Later With Jools Holland and now Spectacle: Elvis Costello With...(have you seen this yet?). In film/soundtrack, Mamma Mia. In digital, there is little to challenge iTunes/iPod, but that can change.
Productions, content brands, franchises, apps – something that indentifies and builds high value audiences and takes them on a journey. Whether that journey starts with a digital search for an artist or the physical purchase of a CD, a radio show or music TV, there must always be a next step for the consumer, to something really worthwhile and of high quality.
Footnote #1. The subjects and views elucidated in this post are those of fictional character Don Draper, not your usual author.
Footnote #2. There is actually a tumblr site called What Would Don Draper Do? http://whatwoulddondraperdo.tumblr.com/ I did e-mail a week ago for the ‘real’ answer. No reply yet, but as I said, these things do take time.
Footnote #3. For UK viewers, Mad Men season 2 returns to BBC4 this year (doesn’t say quite when) but you can catch up with season 1 by spending £12 on Amazon, which is amazing.
Footnote #4. Happy New Year for 2009. January is a busy month but have no fear, The Brew blog intends to be back in early February with another thrilling essay.