Vinyl Sales Keep Growing — So Why Does It Look Like They’ve Dropped?

At most of the greater than 1,500 unbiased report shops within the United States, vinyl gross sales have been rising at a wholesome clip for nearly a decade — up 14.2% throughout all retailers in 2023 alone, in accordance with Billboard’s knowledge supplier, Luminate. So why did Luminate observe 47.3% fewer vinyl gross sales in January and February than it did for a similar months in 2023?

On its face, such a precipitous drop may seem troubling — and puzzling — given the surge of vinyl gross sales because the pandemic. In actuality, the decline is usually a results of Luminate altering the decades-old methodology it had used since Billboard adopted SoundScan’s measurement system in 1991 to depend gross sales at indie shops — a change that Luminate had warned final yr would make 2024’s vinyl gross sales numbers seem considerably decrease. But a number of the drop displays a protest by unbiased retailers towards that adjustment, which one indie group govt worries “could put a damper on one of many trade’s high-profile, feel-good tales.”

Frustrated by the methodology change, a few of these indie shops have stopped reporting gross sales to Luminate, and the Coalition of Independent Music Stores (CIMS), the Record Store Day board, the Music Business Association and different organizations have launched another chart to measure bodily and vinyl gross sales.

“There are penalties to each choice,” Music Business Association president Portia Sabin mentioned in an announcement.

Until the top of final yr, Luminate extrapolated indie retailers’ bodily album gross sales utilizing a technique that weighted precise gross sales by a small pattern of unbiased shops — roughly 70 accounts totaling 140 storefronts, Billboard estimates — that represented 1,500 to 2,000 retailers of their ilk which can be working within the United States, in accordance with label and distribution sources.

Last yr, bodily purchases equivalent to vinyl and CDs at these unbiased retailers — even with weighting — accounted for lower than 3% of complete music consumption items within the United States.

Indie retailers say they don’t oppose extra correct measurement of their gross sales. Rather, they’re incensed that Luminate stopped weighting gross sales simply months earlier than it plans to start the beta part of its upgraded Connect measurement platform, which it had designed to solely depend precise indie bodily gross sales. (The remaining model of the improved platform is predicted to launch in 2025.) They had wished Luminate to delay the methodology change till it onboarded a whole lot extra indie music retailers to report their gross sales.

Until the Connect beta is launched, Luminate is basing indie bodily gross sales solely on the precise gross sales retailers report, which because of the protest has been minimize in half to about 33 accounts with 70 storefronts, Billboard estimates.

Indie shops say they’re protesting due to issues that they — in addition to the indie labels and artists who depend on them for advertising — will lose affect if their gross sales out of the blue seem considerably decrease throughout the board.

Indie-label executives and their distributors say they, too, are anxious in regards to the methodology change as a result of it’d have an effect on the advertising of creating artists. “We are extraordinarily disillusioned that Luminate selected to cease weighting indie retail gross sales with out launching a critical program to enlist retailer reporting and to depend the bodily market,” Matador Records president Patrick Amory wrote in an e-mail. “Independent labels and unbiased artists over index in bodily, and particularly at indie retail, and we want a degree enjoying discipline with the majors to measure success. Luminate is penalizing critical, career-building, album-oriented artists on the charts. Their gross sales usually are not being counted. Their market share is being allotted to the majors. That is a catastrophe for unbiased musicians, labels and retailers.”

An further concern is that smaller gross sales numbers and fewer weight on the Billboard charts, that are primarily based on Luminate knowledge, will “diminish the significance of the bodily market to the music enterprise ecosystem,” as 4 unbiased report retailer coalitions and indie retailing big Amoeba Music put it in an announcement issued in October.

The fear is that much less music will likely be launched in bodily codecs, which might financially damage indie retailers. But a report label govt says given the booming demand for vinyl — a high-margin product for labels — these fears are unwarranted. “Right now,” says one major-label govt, “with the excessive costs that the rising vinyl format instructions, labels are printing {dollars} with wholesome revenue margin.”

Indie retailers, lots of them iconic native companies which have served their communities for many years, have panicked forward of massive modifications prior to now. When the most important report corporations determined to alter the official day for brand spanking new music releases from Tuesday within the U.S. to a worldwide Friday avenue date in 2014, “indie shops informed labels, ‘You are killing us,’” recollects the major-label govt. “And but no shops disappeared within the aftermath of that change.”

Some chart professionals say the boycott might be a dangerous transfer. By deliberately shrinking their affect on Billboard’s charts, indie shops may drive followers — who, due to social media, are rather more attuned to the metrics that decide chart positions — to begin procuring at websites or shops the place they know their purchases will profit their favourite artist.

Artists and report labels hoping to climb Billboard’s charts, in the meantime, may choose to stage meet-and-greets and different in-store promotions at companies that report their knowledge, although loads of acts and report corporations nonetheless host such occasions in shops that don’t report back to Luminate.

In response to the protest, Luminate says it’s working to lure again shops that stopped reporting and onboard a vital mass of indie retailers that haven’t reported their knowledge earlier than. Stores which have stopped reporting are actually permitted to bypass Luminate’s commonplace four-week onboarding course of in the event that they decide to reporting knowledge for at the least a yr. For the latter, Luminate presents an educational video and a written information to the method, though indie retailers say they’ve pressed for personalised help and simplified reporting necessities.

Luminate additionally just lately employed revered veteran music knowledge govt Chris Muratore as its director for partnerships. Muratore labored for 18 years in numerous positions at Luminate’s earlier iteration, Nielsen SoundScan, and extra just lately based Border City Media, the startup behind music consumption knowledge device BuzzAngle Music (now Alpha Data, and, like Luminate, a subsidiary of Billboard’s guardian firm, Penske Media Corporation). He will deal with constructing and sustaining relationships with the unbiased music retail sector “to make sure bodily music sale knowledge assortment is as correct and consultant as potential,” in accordance with the discharge saying his appointment.

When Billboard started tabulating charts utilizing SoundScan knowledge in May 1991, mass service provider gross sales, equivalent to these by chain shops and, later, web or different mail-order operations — had been primarily based on precise gross sales. But the info firm used weighted samples of unbiased retailer gross sales as a result of not all shops again then had the point-of-sale (POS) know-how, nor the aptitude to transmit retailer reviews. So, to compensate, shops had been assigned weighting relying on what number of different non-reporting shops had been of their DMA, or designated market space. But through the years, that course of grew to become tougher, and fewer scientific, as hundreds of shops closed, sources say.

Using knowledge from a confidential Luminate report proven to labels, Billboard estimates that final yr, the info platform counted every album scanned by 140 indie retailers as 8.54 bodily albums. Based on that extrapolation, Luminate reported that a mean of near 72,000 bodily album copies — vinyl and CDs — offered every week, totaling 31.9 million copies offered in indie shops for the yr.

Overall, in 2023, U.S. bodily gross sales totaled practically 87 million copies, of which 49.6 million was vinyl whereas 36.8 million was CDs. Of that complete, indie shops, once they had been nonetheless weighted, accounted for 36.7% of gross sales; non-traditional, which incorporates web, mail order, Christian retailers and shops like Urban Outfitters, comprised 41.5% of bodily gross sales; mass retailers like Target and Walmart, 16.5%; and chains like Barnes & Noble, 5%. As a results of the methodology change and boycott, Luminate reported a 40.2% drop in complete bodily gross sales (together with vinyl and CDs at indie retailers, chains and big-box shops) for the primary eight weeks of 2024 in contrast with the identical interval in 2023 — from 13.6 million albums to eight.1 million. Within that, indie retailer gross sales fell 95.4%, from 5.71 million albums when weighted final yr, to 262,000 copies.

Meanwhile, the aforementioned unweighted common weekly bodily gross sales of practically 72,000 averaged reported by indie retailers from January to November 2023 are actually averaging 27,000 per week for the primary eight weeks of 2024 due to the shops which have stopped reporting to Luminate.

As a part of its plans to calculate precise gross sales as a substitute of extrapolating them from a weighted pattern, Luminate revealed in October that it had recognized 570 indie accounts — with, trade sources say, assistance from labels, distributors and retailer coalitions — that it wished so as to add as reporters. But as of Dec. 19, with the change in methodology looming, Luminate’s Music Connect web site indicated that solely six extra indie gross sales reporters had been added, with the indie account complete rising from 72 to 78. After the obvious boycott started, that fell to 36 reporters, and as of Feb. 22, to 33 indie retailer reporters.

Some of the retailers which have stopped reporting to Luminate are actually sending their numbers to music knowledge evaluation platform StreetPulse, which is tabulating the Indie Retail Top 50 printed by Hits Daily Double. Sources acquainted with the chart say roughly 82 accounts working about 185 indie shops are offering gross sales knowledge, and one other 50 shops are reporting on-line gross sales solely.

Indie shops which have switched to StreetPulse declare it’s extra user-friendly as a result of “Luminate expects the shop reporters to do all of the work to organize the info for ingestion,” says one supply acquainted with the scenario. “That takes time and [requires] a system capable of make the reviews. Luminate expects an indie retailer proprietor, who could also be a one-man operation, to have the technical capabilities and manpower of a series like Target.”

The supply says the StreetPulse system “is cloud-based and has already built-in all of the preeminent POS methods like Square for Retail Free, Shopify Clover and even a number of the legacy methods like Lightspeed and Fieldstack, so it’s a lot simpler to report.”

CIMS and AssumeIndie Distribution govt director Andrea Paschal says she helps the choice chart as a result of she felt her group was “brushed apart” by Luminate.

As this battle continues, it’s value noting that vinyl gross sales continue to grow. Even if indie retailer vinyl counts had been eradicated for the primary eight weeks of this yr and final, Luminate’s Connect system signifies that year-to-date vinyl gross sales for the opposite nonweighted retailer sectors — chain, mass retailers, web/mail order/venues and nontraditional retail — are nonetheless up practically 7%. And the vinyl gross sales bonanza Record Store Day that was launched by unbiased report shops in 2007 is slated for April 20, lower than six weeks away.

A model of this story initially appeared within the March 9, 2024, difficulty of Billboard.