According to an article in the New York Times, Wal-Mart is
getting directly into the music business: “…the retailer is using its leverage to aggressively pursue new deals. On
Tuesday Wal-Mart started selling on an exclusive basis a three-disc collection
by the popular 1980s band Journey called “Revelation.” The difference, however,
is that there is no middleman: the album was bought directly from the band
without the help of a record label. Journey went right to Wal-Mart and kept
most of the money a record company would normally take as profit for the group.
Last year Wal-Mart made a similar deal with the Eagles, who like Journey are
represented by Front Line Management, the nation’s largest music management
company.”
And the article reveals Wal-Mart is using its marketing muscles: “…most of the marketing was done at Wal-Mart itself. The chain ran print, radio and television advertisements that promoted the exclusive availability of the Eagles album. Stores display the Eagles and Journey albums in several locations, not just the music department, and this week some stores had the Journey DVD playing on their big-screen televisions.”
The outcome: “Journey sold 45,000 albums in its first three days on sale, and Irving Azoff, founder and chief executive of Front Line Management and a music industry veteran who ran MCA Records in the ’80s, predicted that it would sell more than 80,000 copies in its first week. That is probably enough to debut in the top five, and significantly more than its last album sold in total.”
How long before Wal-Mart does the same with books? The first beneficiaries would be ‘name’ authors, of course, but wouldn’t it be interesting if, for example, Wal-Mart sponsored a book about do-it-yourself and stocked it in all their hardware departments, or a book about medicines and sold it in their pharmacies? I bet it’s only a matter of time.