Revamped EMI.com Adds Amazon Buy Buttons
As part of an ongoing makeover of the label group's signature site, EMI.com has added buy buttons to its artists pages linked to Amazon for both downloads and CD's. The site has also improved search and recommendation features and revamped artist pages to include a single page overview of whats available.
EMI may have chosen Amazon over competitors because of its ability to handle fulfillment for both physical and digital goods, as well as, its global reach. But the partnership is still a major slight to iTunes and others who would have coveted their portion of the business. More curious is why EMI did not choose to reap higher profits by doing digital fulfillment on their own and outsource only the more logisitcally difficult physical sales.
Perhaps the Amazon partnership is confirmation of the complexities of setting up global distribution and fulfillment; or is may just be an acknowledgment that EMI has far more fundamental problems to tackle first.
Not shocked by this development one bit. It’s definitely not easy to establish a separate retailer. I think Amazon’s MP3 Store has a good bit of momentum ahead of them, and their market share will only be improving.
It was pegged at ~8% a little while back. I imagine they could see upwards of ~20% in the next two years. It’s a better music store than iTunes anyways.
Even if they negotiated a better affiliate fee than Amazon’s typical rate, I think this is kind of a short sighted move on EMI’s part.
To remain relevant, labels must provide a wide range of services for their artists. Handing off physical and digital fulfillment to Amazon just underscores that EMI has no direct to consumer capability in-house, and this deal will likely be a good excuse not to focus on building that capability and developing that expertise.
With more artists learning that they can make a lot more money finding their own D to C solution, it’s going to be harder to rationalize signing to a major, unless the major has really strong distribution, marketing and licensing services. There are a huge amount of companies offering these services for nominal fees and the smart, modern label will retool itself to be a one stop shop for the artist, at a competitive price. That’s how they’ll get acts to keep signing with them. If you’re just handing the business off to Amazon, how long is it before the artist cuts out the label and does that themselves, then uses someone like Topspin for D to C?
Going with Amazon is an old school strategy – they are analogous to a big-box retailer. At this point the entire retail market is Amazon and iTunes. A far smarter strategy would be to figure out way to enable competition to these two big players, not further empower them. This is a zero investment way to handle fulfillment, but it’s not a wise long term strategy.
Yikes!!
Just another reason for being cautious before jumping in with and EMI label. All of my download return is pretty much 75% iTunes 20% Amazon 5% other.