Mar 13, 2011
Posted by: Hitsville

The curious case of the newspaper mention of how Starbucks used to sell CDs

starbucks.jpg“But the newspaper didn’t mention the fact that Starbucks used to sell CDs. ”

“That was the curious incident.”

Four years ago, all we heard about was how Starbucks was going to change the music industry. Why, Paul McCartney was selling his new album through Starbucks!

The breathless stories never said that only the novelty of the pairing, combined with the high disposable incomes of the typical Starbucks patron, was what allowed such things to (evanescently) happen. As Hitsville predicted over and over, the arrangements were dead ends, and would not be repeated. Anytime how the music is being sold is being talked about instead of the quality of the music, the quality of the music isn’t good.

The NYT story today on the difficulties the coffee retailer is having doesn’t even mention the chain’s insanely overcovered foray into the music business.

Why should it have mentioned it?

Because a quick search I just did suggests the paper had the words “Starbucks” and “music” in the same story 177 times in a 18-month period, many of the pieces more than 1000 words.  (I suspect something similar would turn up in the WSJ, though I can’t do that search on the paper’s web site.)

Jun 25, 2008
Posted by: Hitsville

Starbucks officially gets out of the music biz

starbucks.jpg… as foreshadowed here. And if nothing else, the Sonic Youth promotion was an excellent sign that the company’s music plans had gone straight off the track. The Silicon Valley Insider story is here:

Starbucks, which has been scaling back its once-grand ambitions to turn itself into an entertainment hub, is about to shrink its plans yet again. We hear that by September, the chain will have dumped almost all of its in-store music retail offerings.

That means no more “spinner” racks offering multiple CD choices to latte-buyers. And that also means no more gift cards and promotional giveaways for Apples iTunes (AAPL). Instead, we’re told, the coffee chain will offer just four CD “slots” per store. But it will also continue to offer free Wi-fi access to Apple’s online music store and may continue to try to sell entertainment online.

The Insider repeats two Starbucks music factoids that seem to be contradictory: That the company was selling more than four million CDs a year, but that (per a Jeff Leeds NYT story from March) the average per store was but two discs sold each day. Given that the company has 10,000 stores, roughly, in the U.S. and another five around the world, those two figures don’t gibe. (If the two-discs-per-day figure is true, the company would have sold seven million CDs in the U.S. each year, or more than ten million if they were counting international outlets. The discrepancy seems to come from a distinction the Times was making between company-owned outlets and licensed ones.)

Anyway, the real reason the campaign collapsed is that it was all based on novelty. You might buy a Norah Jones CD in line at Starbucks if you like her, you were going to buy it anyway, and you notice it on the counter. And then, caught up in the excitement of an effective marketing campaign, you might grab the McCartney disc a month later. But at that point reality kicks in: Most folks were quickly reminded why they hadn’t bought the last dozen or so McCartney albums. (His songwriting talents have deserted him.) Other so-called Starbucks artists don’t sell many records in any case. (Like Lucinda, for example.) And the shift to more mainstream acts, like James Blunt, drained away the novelty.

The myth that this was an important story was agrreably parroted by the press, which unaccountably found the idea of Starbucks selling CDs (or helping to publicize a movie, Akeelah and the Bee, for which the producers of the film paid Starbucks) endlessly fascinating and gave the company reams of publicity for what were essentially marketing agreements.How this was any more interesting than Orville Redenbacher, for example, setting up a popcorn kiosk at a Blockbuster, except less intuitive, was never clear.

May 28, 2008
Posted by: Hitsville

Sonic Youth and Starbucks, together at last

starbucks.jpgThe buzz word in the music industry is branding, which is a nice way of saying “selling out.” If you have a brand, you of course monetize it.

Latest candidate: Sonic Youth, with the help of Starbucks and a host of hipster celebs not above lending their names to a cheesy collection of product for the coffee checkout line.

From a press release I just got:

Sonic Youth’s Hits Are For Squares

Beck, Dave Eggers, Chloe Sevigny, Eddie Vedder, Gus Van Sant and More Choose Their Favorite Sonic Youth Songs For Starbucks Compilation

The limited-edition CD will be available exclusively at select Starbucks locations in Boston, Chicago, Philadelphia, San Francisco, Seattle, Los Angeles, New York City and Washington, D.C.

New York, May 27, 2008 – On June 10, 2008, Universal Special Markets and Starbucks Entertainment will co-release Sonic Youth’s Hits Are For Squares. The limited-edition CD features Sonic Youth fans from music, film and literature selecting their favorite recordings from the band’s voluminous body of work that dates to 1981. It also includes a new, exclusive track from Sonic Youth, “Slow Revolution” recorded last year with longtime producer John Agnello.

Hmmm… A limited edition available in limited cities. I can’t imagine why this won’t be available in Des Moines. The celebs involved include everyone from the folks listed above to Juno screenwriter Diablo Cody and (collectively, one assumes) Radiohead and the Flaming Lips.

In Juno, you’ll recall, the Justin Bateman character, a jingle writer named Mark Loring who lived in a bland suburban manse, used to play in a band that opened for the Melvins and loved Sonic Youth, though young Juno, a Stooges fan, didn’t know who they were.

Those distinctions made no sense in the movie. (So as not to confuse viewers, the Sonic Youth song you heard in the movie was … a Carpenters cover!) This CD should be called “The Mark Loring Collection,” to capture the sheer implausibility of the yuppie embrace of a noise band that never sold any records but is in the process of cashing out its name in the twilight of its career.

The full track list, according to the press release:

  1. “Bull in the Heather” selected by Catherine Keener
  2. “100%” selected by Mike D
  3. “Sugar Kane” selected by Beck
  4. “Kool Thing” selected by Radiohead
  5. “Disappearer” selected by Portia De Rossi
  6. “Superstar” selected by Diablo Cody
  7. “Stones” selected by Allison Anders
  8. “Tuff Gnarl” selected by Dave Eggers and Mike Watt
  9. “Teenage Riot” selected by Eddie Vedder
  10. “Shadow of a Doubt” selected by Michelle Williams
  11. “Rain on Tin” selected by Flea
  12. “Tom Violence” selected by Gus Van Zant
  13. “Mary-Christ” selected by David Cross
  14. “World Looks Red” selected by Chloe Sevigny
  15. “Expressway to Yr Skull” selected by Flaming Lips
  16. “Slow Revolution” exclusive new Sonic Youth recording
Apr 25, 2008
Posted by: Hitsville

The Starbucks affair is over!

starbucks.jpgThe collapse of Starbucks’ plans to become a major player in the film and music industries collapsed yesterday, as the chain jettisoned its top entertainment exec and outsourced its music arm.

Wrote the Times:

As part of the changes, Starbucks said Ken Lombard, president of the entertainment unit since 2004, had departed.

Starbucks also said it would turn over management control of Hear Music, its in-house record label, to its partner in that venture, the Concord Music Group.

Thus endeth one of the silliest ongoing stories in the industry, as each time the company sent out a press release the press swooned: “Starbucks goes Hollywood!” “Starbucks signs Paul McCartney!”

It all started two years ago, when the press was abuzz with talk of Starbucks’ getting into the movie business by cutting a promotional deal with LionsGate for a film called “Akeelah and the Bee.”

The deal was announced on the front page of the Wall Street Journal, and then breathlessly followed up by the New York Times (which credited the Journal with the scoop) and the LA Times (which didn’t) . Wrote the Journal:

For Hollywood, Starbucks represents a potentially lucrative new force at a time when the industry is struggling with a steep downturn in movie attendance and flattening sales for DVDs. With pastimes like videogames stealing customers and consumers turning to the Internet and other new technologies for entertainment content, executives are rethinking how they sell movies. A key part of that effort is finding new real estate in which to grab moviegoers’ attention.

Wrote the LAT:

Lombard said Starbucks wanted to be to movies what talk-show host Oprah Winfrey’s book club was to reading. Though the company says it will not produce films, it plans to pump millions of dollars into films it chooses to promote.

“This is not a test for us,” Lombard said. “This is a firm commitment for us to expand the brand into the movies.

[…]

“They broke the mold when they decided to do music,” said Ron Paul, founder of Technomic Inc., a food market research company. “If bookstores have coffee, then why can’t a coffee store sell books and movies?”

Well, for all sorts of reasons. If you read the stories closely, you could see that the producers of the film were basically just paying the chain to promote its movie; Starbucks was given some undisclosed share of the film’s profits, along with a courtesy “presentation” credit on the film itself.

This was all basically an adult version of a Happy Meal with a Narnia figurine. The twist was that the film was paying the store for the tie-in, rather than the other way around. But even this wasn’t all that different from all of the other non-coffee crap the chain purveys from its stores. Still, Starbucks had a canny PR campaign for the deal, the WSJ bit, and the other papers followed up on the big news.

Now we can see that it was a sketchy plan all along. While Starbucks has obviously shown it can sell music and perhaps even DVDs out of its stores along with little tins of breath mints, the stories today note that the company basically hit a wall at a certain point, as per-store numbers on media sales haven’t risen lately.

The problem with the strategy is that it was predicated on novelty. With movies and CDs, after the novelty  of buying a Starbucks-approved CD wears off, folks will actually start to notice the quality of the music or movies they are being presented with each week or month.

Paul McCartney offering his new record through Starbucks is an interesting fact—for about five minutes. And Starbucks got its little blast of publicity for it.  Joni Mitchell’s doing the same thing is interesting too, but at that point the half-life phenomenon kicks in. What happens next, Elvis Costello? Maybe Van Morrison, and all of a sudden the company is out of pantheonic figures to market and has to go down a tier—to John Cougar Mellencamp, or  Stevie Winwood—and then another: I don’t know, Shawn Colvin, maybe, or Jackson Browne.

Starbucks can sell whatever it wants to in its stores, and for folks who want their music and movies mediated by a fast-food outfit it’s a good match. But as I’ve noted before, when the “how” of the selling of the product becomes the story, it’s a good bet that there’s little else to talk about.

Jun 08, 2009
Posted by: Hitsville

Sonic Youth, whining

Via Twentyfourbit.com and the Daily Swarm—a rant in the Guardian from Kim Gordon against Radiohead’s In Rainbows pay-what-you-want model:

“[Radiohead] did a marketing ploy by themselves and then got someone else to put it out,” Gordon told The Guardian’s David Peschek. “It seemed really community-oriented, but it wasn’t catered towards their musician brothers and sisters, who don’t sell as many records as them. It makes everyone else look bad for not offering their music for whatever. It was a good marketing ploy and I wish I’d thought of it! But we’re not in that position either. We might not have been able to put out a record for another couple of years if we’d done it ourselves: it’s a lot of work. And it takes away from the actual making music.”

Gordon, like other artists, obviously hasn’t really thought about what it was exactly that Radiohead did. Community had nothing to do with it.

The idea was that, since the music was going to be available online anyway, why not try to get in front of the issue and make it as easy to pay for as get for free?

Did it work for Radiohead? It looks like it. In the end, the band’s publisher claimed three million “sales” for the album, which I guess is reasonable when you take into account foreign tallies, its own offering, and iTunes, which the group finally broke down and joined.

Since Radiohead released the thing on its own, taking far more from each transaction than the $2 or $3 it might have gotten from EMI, the financial take should have been correspondingly breathtaking, notwithstanding the fact that some fans paid less than they would have otherwise. (The group is also said to have unloaded 100,000 $80 special editions of In Rainbow on fans, representing another chunk of change.)

What does that total? $25 million?

Anyway, back to SY. Leaving aide Gordon’s double-reverse ironic/not-ironic patois, which I bold-faced above, Radiohead wasn’t devaluing its music. It was just dealing with reality, which, unfortunately or unfortunately, has devalued music period.

The question is whether the same opportunities are available to Sonic Youth. The answer is, mutantis mutandis, yes and no. Sure they can do it, but no, they’re not going to make as much money out of it.

Why? Because they’re Sonic Youth.

The real irony here is that the group is one of those bands who probably did better than they should have with its major-label deal, in this case with Geffen; it’s hard to imagine they ever made money for the label. The band seems to have left it amicably—i.e., without any money owing, though its hard to see how it could have recouped its advances from the heady Nevermind era. On the other hand, there’s been this or that re-release of things like Goo, which would presumably bring the band a little bit of money.

Then as now, one of Sonic Youth’s selling points has paradoxically always been its uncommerciality.

Today, on Matador, they would probably benefit from higher royalties, but get much smaller advances and of course benefit from less marketing, the corresponding fewer sales and, inevitably, much less interest from fans. That why it’s gotten on the “We’re gonna play one of our old albums in its entirety” bandwagon—and why it made that ludicrous deal with Starbucks.

Here’s Lee Renaldo, incidentally, explaining that little deal to the Guardian, which deserves credit for bringing it up:

“It didn’t take a lot of blood and sweat from us. We thought we’d try it and see what happens. There’s a certain side to this group that likes perversity, and that’s a pretty perverse concept. At that time, Starbucks were selling records when no one else was. The majors were throwing up their hands. The irony is, for all the spewing it caused on the blogs, it is our most rare record. I have never seen a copy in a store, and I’ve never met anyone who’s seen a copy in a store.”

Funny how Renaldo pats himself on the back for the creepy association, trying to spin it as being radical. (“I threw a drink in this woman’s face. I wasn’t being an asshole; I was being perverse.”) He’s just rationalizing doing a promo deal with a coffee shop trying to look hip. The fact that it wasn’t successful after the band pocketed its fee underscores again the fact that Sonic Youth has done pretty well in its career from the kindness of strangers.

The idea of the old-fashioned major keeping major artistes on board even when they didn’t make any money was always overstated; in the end, its difficult to separate out them from those to whom the labels just paid too much for, given their sales records.

But in the world we live in today cozy homes for the likes of Sonic Youth will be very rare; all it really has, in the end, is that cool factor, which will decline with each Starbucks deal. Gordon’s snipe at Radiohead, which after all is just doing its best to make its own place in that new world, is perhaps a sign of the pressure getting to them.