Crypto Pop: The Future of Music?

BBC: “The year is 2018. Music is changing fast, but can the humans keep up? Here’s a handful of possible outcomes. 1) Your favourite singer is not real: … One of Japan’s biggest pop stars Hatsune Miku is not a real person. But that small detail didn’t prevent the humanoid singer from releasing another new music video last week.” Roy Orbison “died in 1988 but now his 3D hologram world tour will come to life, alongside the Royal Philharmonic Orchestra, on 8 April in Cardiff.”

“2) The live parameters have shifted: Ben Robinson of Bluedot Festival comments: “Now people can experience being on the stage with the artists. Or the gig could move off the stage.” 3) “The recording studio is in your laptop: Noel Gallagher … never actually met the bass player on his new album Who Built The Moon?” He comments: “Here I am at two in the afternoon talking to a guy on an iPad and for him it’s four in the morning and I can hear the song coming through his speakers and he’s saying ‘What do you think of this? Maybe if I do that?’ And I’m like ‘this is so far out it’s unbelievable’.”

“4) There’s a direct line between you and your favourite act: Jack White’s Third Man Records reward their subscribers with deliveries of exclusive limited edition pressings. DJ Gramatik went a step further last week by becoming the first artist to ‘tokenise’ himself, meaning fans who buy the token using the cryptocurrency Ether can potentially share in his future revenue … 5) But new music technology will not be for everyone:Bass player Peter O’Hanlon says: ‘Our fresh approach will be that we just come and play the gig! Everybody else is flying across the stage and we just stand in front of you and play’.”

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Music CDs are Alive & Kicking

CBC News: “Preliminary numbers from Nielsen Music Canada show that while CD sales fell 18 per cent over the past year, still selling roughly 10 million units, they were relatively strong compared to the more dramatic erosion of digital album sales through stores like iTunes. Digital album sales tumbled nearly 25 per cent for the year to 6.2 million units, extending what is expected to be a steep downturn as more listeners embrace streaming services.”

“David Bakula, who oversees Nielsen’s industry insights operations, said the changes in digital habits mean the CD is representing a larger share of the declining album sales market. He believes that writing the obituary for the CD is premature as labels look to bolster album sales however they can, while older listeners stick to their usual buying habits.”

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Why Do Shoppers De-Value Digital Goods?

Harvard Business Review: “Despite the many advantages of … digital goods, companies find again and again that people value and are willing to pay considerably more for … their physical counterparts … experiments suggest that the key driver of this value loss is not the resale value of the good, or how much it costs to make, or how long it can be used, or whether it’s unique or popular. We find that the key difference is that digital goods do not facilitate the same feeling of ownership that physical goods do.”

“Because we cannot touch, and hold, and control digital goods in the way that we interact with physical goods, we feel an impaired sense of ownership for digital goods. They never quite feel like they are ours, and when we feel that we own a thing, we psychologically inflate its value. As a result, digital goods don’t enjoy this premium we extend to things that we own.”

“Ownership may be achieved by increasing users’ feeling of control through touch interfaces, and customization opportunities that involve users in the production or design of the product … people may devalue autonomous devices that require little or none of their input … those devices will not benefit from the value premium extended to goods for which people feel psychological ownership … Because perceived ownership is impaired for digital goods, people may not feel that their piracy causes the same harm to their owners as does the comparable theft of physical goods.”

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Bookstores are ‘Houses of Seduction’

The Globe and Mail: “Unless you’re just about to board, bookshop browsing can be a deeper and more untethered exercise than other kinds of shopping. Just opening a book and reading a few lines can draw you partly into another world, one you might not have planned to visit. According to Vancouver publishing consultant Thad McIlroy, only 40 per cent of bookstore purchases are premeditated. All the rest are decided on impulse.”

“Knowing this, booksellers and publishers think carefully about how to design the space and arrange the stock … a good bookshop is a house of seduction, created to lure the book lover and keep him or her circulating in the aisles. The sumptuous beauty of shops such as El Ateneo Grand Splendid, in Buenos Aires, is part of the game. Systems for displaying the wares may follow a wonderful, idiosyncratic logic. Altair, a travel bookshop in Barcelona, arranges even its fiction and poetry titles geographically.”

“In the online trade, only the books circulate, while the readers stay at home in front of their screens. Algorithms make robotic suggestions, following a practice launched by the London bookshop Hatchards (established in 1797), where live, professional readers still select and ship books to subscribers. Hard-copy books are still published by the thousands; it’s the transactions that have become ethereal.”

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Perfumarie: The Nose Knows Retail

The New York Times: Mindy Yang’s Perfumarie in SoHo “specializes in blind perfume shopping, allowing customers to smell fragrances with all the branding removed … In her quest to encourage consumers to trust their noses, Ms. Yang decided to put perfumes on tap, labeling them only by number. She installed 32 identical fragrance spouts along the minimalist back wall of the space, removing any hints of branding, packaging or price information. Underneath each tap is a small gray stone tagine containing a white paper swan soaked in the mystery perfume”

“Customers are encouraged to sniff in numerical order, taking notes on a clipboard about the scents that set their synapses ablaze. The scents begin light, with airy and citrusy notes, and get progressively stronger. Ms. Yang likens this to beginning with white wine and graduating to a full-bodied cabernet. Shoppers are not permitted to know the name of the perfume they’ve selected. Instead, the vials are labeled with numbers, looking a bit like prototypes stolen from a chemistry lab … At the end of every month, Ms. Yang hosts a cocktail party to unveil the tap selections. She also posts the full list online so that customers can discover the truth about the perfumes they took home.”

“When customers pay for their first blind smelling, they have the option to become a Perfumarie Explorer’s Club member. Their scent notes are scanned into a database and saved for future reference … Ms. Yang hopes that by offering membership and stressing the community aspect of the store, customers will return month after month. She wants them to treat their past smelling notes like a library, learning how their taste evolves over time … she hopes it will be equally attractive to the industry as a street-level test lab.” She comments: “I am no longer interested in traditional retail. People need to learn how to be empowered to have a point of view and choose what they like for themselves.”

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Returns: The New Retail Battleground

The Wall Street Journal: “This year traditional and online retailers have expanded the number of locations and routes consumers can use to return merchandise, from in-store kiosks and lockers to the mall concierge, grocery stores, parcel shipping locations and at-home pickup … Online retailer Amazon.com Inc. said it has expanded options for in-person returns this year, with a network of 2,000 ‘locker’ locations, including 400 at Whole Foods stores, where customers can drop off items to be returned. Amazon also partnered with Kohl’s Corp. stores in Chicago and Los Angeles, which are accepting returns of Amazon goods bought online.”

“Wal-Mart Stores Inc. is touting its Mobile Express Returns kiosks, located in its stores, where it says customers can complete the return process in less than five minutes and receive a refund within a day or so. Returns to Target Corp. and Wal-Mart are free—customers can either bring the items back to the store or print a shipping label online and drop off merchandise at a designated shipping location. Kohl’s and J.C. Penney Co. Inc. have similar policies, but don’t cover the cost of return shipping.”

Meanwhile: “Returns have become a ‘battleground’ among online retailers trying to attract and retain customers, said Tobin Moore, chief executive of Optoro Inc., a logistics provider that helps companies like Target and Best Buy Co. to take back and resell returned merchandise … Mr. Moore of Optoro estimates that goods purchased online are three times more likely to be returned as goods purchased in a physical store. In total, Mr. Moore said roughly $90 billion in holiday merchandise—purchased either in stores or online this season—will be returned over the next few weeks, with more than a third of it coming back before the new year.”

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Walkability: Pedestrian Retail Prospers

The Wall Street Journal: “Despite a glut in U.S. retail space, some developers are building more, just not in the form of malls but alongside new homes in smaller chunks than before. The target clientele: younger and even some older Americans who are looking for cheaper housing in the suburbs but favor areas with urban trappings such as restaurants, offices and shops … The focus is on a design that is pedestrian-centric, where residents would have to walk only short distances to get to the grocery store, shops or the gym.”

“In Fort Worth, Texas, residents at the RiverVue Apartments, a new 375-multifamily-unit rental complex, need only a minute to walk to a Whole Foods in the next building. Other shops and restaurants such as REI, Sur La Table, Piattello Italian Kitchen and Taco Diner are also within walking distance.”

“Some retail property owners are constructing residential units or offices in or next to their enclosed malls or open-air shopping centers, or in some cases on top of street-fronting retail stores. Along with additions such as medical offices and hotels, a built-in shopper base helps support foot traffic to the stores and restaurants. Office workers and out-of-town hotel guests might also find it convenient to have food and entertainment options nearby.”

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What’s Small is Big Again in Retail

The Washington Post: “Across the country, retailers such as Walmart, Target, Macy’s and Nordstrom are experimenting with ways to distill their inventory into smaller, more-focused locations. The shift comes, analysts say, as Americans flock from the suburbs to city centers, where space is at a premium. Big-box stores on the outskirts of town are no longer convenient nor practical for millennials with tiny apartments and no car. Target alone is opening 30 smaller stores by the end of the year, doubling its presence near urban areas and college campuses.”

Mike Paglia of Kantar Retail comments: “That big weekly stock-up where you fill up the back of the car? That’s very much boomer mentality that millennials aren’t buying into.”

“Sales at smaller-format stores are projected to grow 3.9 percent annually until 2022, outpacing 0.8 percent sales growth for their big-box counterparts, according to recent projections from Kantar Retail. Stores smaller than 20,000 square feet account for $612 billion in annual sales, with that figure slated to grow 21 percent to $741 billion in the next five years.”

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Wausau Story: Mom & Pop Comeback

The Wall Street Journal: “Wausau Wisconsin shows how an economically thriving community might shop in a post-mall age. No longer are shoppers willing to drive distances to hit a clothing retailer. That is an online task. They are willing, however, to make an event of going downtown, to the compact shopping district where two-story brick buildings line the streets, to patronize Wausau’s local boutiques.”

“On 3rd Street, the bell chimed at The Local every few minutes one recent Saturday afternoon, signaling a customer coming in to check out Wisconsin-made Christmas wreaths, coasters cut from pine trees and candles in recycled beer bottles. Owner Alison Magnuson, 26 years old, said shoppers her age want something they can’t find just anywhere. She got the idea to open a physical store with products handmade by more than 30 local artists after selling her own work on the online crafts marketplace Etsy Inc.” She comments: “People want that mom-and-pop store again. It’s all coming full circle.”

“Three blocks from the mall, the century-old Janke’s book store was bustling on a recent Saturday. Inside, in the shadow of a 10-foot bear shot by a member of the Janke family, shoppers were buying children’s games, handmade cards and books by local authors … The store has adjusted to changing consumer demand by offering more educational toys and locally made products, Jane Janke Johnson said. Business is good for now, she said, but the recent acceleration in online spending scares her more than any other trend she has weathered. ‘People will come in here and click, click, click, they’ll buy it in front of my eyes,’ she said. ‘That hurts’.”

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MoonPie: A Total Eclipse of the Twitterverse

Fast Company: “MoonPie’s sales are up 17%. And this is a brand that’s had no new product innovation, no significant distribution increase, and no discounting going on. And there’s no TV advertising. So all of these increases can be attributed to what we’ve been doing on social media.” ~ Dooley Tombras, EVP of MoonPie agency, the Tombras Group.

“Tombras says the brand’s Twitter voice came about out of the good ol’ fashioned necessity to stand out and get millennials to take notice.” He explains: “Moon Pie is an iconic heritage brand, but had been really sleepy for a while. The business challenge was, while they run a healthy, profitable business, their sales had plateaued. Their research showed they had much higher awareness and sales among older consumers, baby boomers, but as you went younger, that number got lower, and it really dropped off at millennials.”

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