Interview with Jim Donio, President of NARM: Part II – The Music Industry

Last week, I posted part one of my interview with Jim Donio, President of NARM.  Later this week, the 2010 NARM convention will come to Chicago, which is what we talked about during the first half of the interview.  Catch up by reading part one.

For the second half, we spoke about the music industry.  We spoke about the resurgence of vinyl, the battle between the digital and physical formats, the role of social media in the business of music, and the considerations aspiring professionals and artists should think about when entering the industry.

Contrapuntist: I’d like to now ask you about the music industry.  Greg Kot from the Chicago Tribune recently spoke with Steve Wilson from Porcupine Tree.  In the interview, Wilson said the following:

“Vinyl sales are rising not just because people my age are feeling nostalgic, but because kids are getting into it. One of the interesting things history tells us is that for every action there is an opposite reaction. And with the current trend towards convenience, there is a reaction against that. People are looking for something more organic and special from music.”

What do you think about what Wilson said?

Jim Donio: I think that is absolutely on point.  I’ve been saying this for a couple years now as this “trend” has been noticed by the outsiders looking at our industry. Vinyl provides a different type of experience.  Once people discover it or rediscover it, it’s just a different dimension of the experience of music.  It doesn’t mean people will want vinyl to the exclusion of anything else.  Someone who purchases vinyl may also be a very heavy mobile music listener.  It may be someone who has a subscription service.  What we find is that the super music fans generally bridge different methods of delivery.   You may find a very heavy digital devotee might also be someone who also likes to collect vinyl for the experience of it. We see vinyl as something that has been given a tremendous platform in the new music business paradigm.  In April every year, NARM is one of the sponsors of Record Store Day, which just took place a couple of weeks ago. It was the biggest sales day for vinyl in the past 20 years.  Clearly, it is not just a fleeting kind of thing.  People are looking at albums, looking at vinyl, looking at physical product itself as the art form that it is. I think it is a terrific thing and it has created a lot of excitement over the past couple years.

Contra: What do you think is the future of music distribution, the digital or physical format?

JD: For the foreseeable future, we are going to see a balance; an equilibrium between the physical, digital and mobile.  You are going to see a spectrum of consumer touchpoints for music. Someone at any given moment may choose to buy a vinyl album.  In the next moment they may be listening to music on their iPod. Then they may have a music subscription where they listen to music in their office.  Music is not a homogenous, one-size-fits-all experience.  It never has been.  In today’s marketplace, we have a situation where there are so many new choices and opportunities.  That is terrific for the music fan.

I don’t think we are going to see a point in time where we have fewer choices.  If anything we are going to have more choices, more ways for people to discover music, to access it, to experience it, to listen to it, to purchase it, to collect it on this spectrum.  I don’t see a point at which there would be zero physical and a hundred percent everything else.  I think there will always be some role or market for a physical product/manifestation. Whether it is collecting an artist you love, commemorating a moment in time or giving a gift to someone, which is a very big dimension of promoting music, that is a great memorable gift that people love to give to others.  I don’t have a crystal ball to say what the percentages will be two years from now, five years from now, ten years from now.  In the near term, I think we will continue to see a balance between the various musical forms.

Contra: In the past couple of years, social media and other social technologies have emerged as major players in the marketing world.  What kind of role should these new technologies have in the music industry?

JD: They are very new and they are very exciting, in terms of not knowing what their full potential can be.  We see artists, labels and businesses utilizing these tools to varying degrees and varying ways, depending on their individual focus and the way in which they would like to use these tools.  I think they will continue to play a significant role as they develop and unfold as new dimensions are added to these tools.  Because music is a very social product and experience, because it has a very emotional and individual attachment to it.  Social media does provide an opportunity for that kind of connection between people and companies; and people who support them or purchase their products, services, etc.  I see that as a continuing opportunity in the future.

Contra:  Social media does seem like a natural fit for the music world because it is such experience, so it is interesting to hear your perspective on it. The music industry has certainly experienced a lot of change in the past decade.  Where do you think the industry will be in five or ten years?

JD:  As I said, I don’t have a crystal ball. It is very hard to know.  Every day there are new developments in the music business; going away from the business, or changing their profile, or morphing into something new, so it really is hard to say.  We see that almost literally every day, so it is really hard to know. What I would say, there probably hasn’t been more interest in music and I don’t see that going away.  I see that only growing over time.  We have more exposure, more access, more music around us to lift us up, to inspire us, to be there for us in all those special moments in our lives.  That has always been the case and I am sure that is one thing that isn’t going to change.  But the music business of May 5, 2010 probably won’t look anything like the music business of May 5, 2015. Only with the relative speed of the change that we are seeing and the new opportunities and technologies that continue to come to our attention every day, I am sure that isn’t going to stop.

Contra: Are there particular trends that music business professionals or aspiring artists need to pay attention to and focus on?

JD: People need to pay attention to their goals and objectives and cultivating a fan base. If you are an artist and this is what you want to do for your livelihood and making your living from this, then you need to determine what that lifestyle needs to be. Do you want to be a performing artist who sells some music as you travel around and perform? Do you want to primarily be an artist who writes music for other people?  There are so many ways you can be in the music business. I don’t think there is any one particular trend, other than to somehow get your head around the fact that things are changing every day. The flip side is that we still have a music business that is dominated by a physical product. Many wouldn’t have thought that we would still be in this position in 2010.  Those who predicted, as recently as two or three years ago, there would be no more CDs.  Certainly, we are in 2010 and, true, fewer are being sold, but it is still the dominant form.  I don’t think there is any one trend.  I think you have to look at all the developments and chart a course that works for you.

Contra: Thanks so much for taking the time to speak with me.

JD: You’re welcome.

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