Although it may seem strange for retailers to essentially stock products from online stores, there are a lot of reasons they may be excited about this sort of distribution arrangement. Unlike standard CDs the new download cards, which are already available from retailers like the Safeway grocery chain and Starbucks, take little shelf space and since they have to be activated before use they also don't cost anything.
Industry insiders seem satisified with the product so far. "People are pleasantly surprised by the results," Sony BMG Music Entertainment senior vice president and general manager of U.S. digital sales Adam Mirabella said. "This is a new product, and the customers are just learning about it," EMI Music Marketing senior VP of sales Darren Stupak said. "So the sales can only get better."
Another upcoming product intended to connect the offline and online worlds is the ringle. A couple of songs and a credit for a ringtone are included in a single package. Music labels are hoping the ringle will energize profits from physical CD sales, although critics point to it as an example of how labels are out of touch with consumers.
As digital music technology moves from the CD to the download as the standard purchase format, brick and mortar sales also appear to be on the move - out of traditional music resellers and into other businesses where its a secondary interest. Taking the financial burden of inventory and shelf space out of the equation looks like another step in that direction.
Source: Reuters
Written by: Rich Fiscus @ 28 Oct 2007 23:34
