The music industry is changing and that’s good news, with music trends shifting rapidly as technology and consumer behavior change. In this article, we will delve into the key trends shaping the music industry in 2023, based on a comprehensive analysis by Luminate, a leading provider of music data and analytics.
Table of Contents
- Direct-to-Consumer (D2C) Sales
- The Rise of Super Fans
- Physical Music Sales
- Globalization of Music
- Country Music’s Moment
- Content Proliferation
- The AI Influence
Direct-to-Consumer (D2C) Sales
D2C sales are becoming an increasingly important part of the music industry. In fact, 37% of the general population reported buying merchandise at a concert, indicating a significant potential for growth in D2C sales if more merchandise is made available on D2C sites. This trend also extends to music sales, with the potential for artists to sell their music directly to fans alongside merchandise.
The Rise of Super Fans
Super fans, or highly engaged and dedicated fans, are a key demographic for artists and the music industry as a whole. These fans are characterized by:
- Being the first in their network to discover new artists and being a source of recommendations for their friends.
- A desire to connect with artists on a more personal level, expressing their identity through their alignment with the artists’ values.
- A love for being super fans and engaging with other super fans, continually learning about new music and sharing it with others.
These super fans are early adopters, discovering new music and amplifying it to others. They represent a significant portion of music consumers, with 15% of the general population and 19% of music consumers being classified as super fans. These fans spend 80% more money on music activities monthly than the average consumer, and are over two times more likely to make physical music purchases, indicating their high level of investment in their favorite artists.
Physical Music Sales
Despite the rise of digital music, physical music sales are still significant, particularly among super fans. Independent record stores have seen a growth in their share of physical music sales, with a 26% increase in sales in the first half of 2023. Internet mail order, which includes D2C sales, still represents a significant portion of physical music sales, but its growth rate is slower than that of independent record stores.
When it comes to the demographics of physical music buyers, vinyl buyers are particularly interesting. They are more likely to be Gen Z, LGBTQ+, live in urban areas, and spend twice as much money in the music industry. The optimum prices for vinyl records vary significantly depending on the audience, with jazz fans willing to pay upwards of $30 per record, while boomers are willing to pay less than $20.
Globalization of Music
The globalization of music is a significant trend, with 69% of US music listeners reporting that they listen to music that originates outside of the US. At least 40% of music listeners in the US listen to music that’s not in English, with Spanish, French, and Japanese being the most listened to non-English languages.
This trend is reflected in the consumption data, with the share of English tracks in the top 10,000 tracks in the US dropping by 4.2% since 2021, while Spanish and Korean tracks have seen growth. This shift is also evident globally, with the share of English tracks dropping by 11% since 2021, while Hindi tracks have more than doubled their share.
Country Music’s Moment
Country music is experiencing a significant moment, with a younger, more streaming-focused fanbase emerging. Artists like Bailey Zimmerman, Luke Combs, Zach Bryan, and Morgan Wallen are attracting a younger fanbase, with Gen Z and Millennials making up a significant portion of their fans. These fans are more likely to discover new music through video and/or audio streaming services and listen to playlists shared by family and friends.They also embrace fan clubs and fan club apps as a key way to communicate with their fans.
Country music is being streamed the most in the US, followed by Canada and Australia. However, the genre is also seeing significant growth in unexpected places like the Philippines, which has seen 600 million country streams so far this year.
The amount of new music being released is increasing significantly, with an average of 112,000 new International Standard Recording Codes (ISRCs) being added to the Luminate system each day in 2023. This content proliferation is largely driven by independent distribution and DIY artists, with less than 5% of new ISRCs coming from major labels or their independent distribution arms.
The AI Influence
Artificial Intelligence (AI) is also having an impact on the music industry. An example of this is the track “Hard On My Sleeve” by Ghost Writers, which was created with AI to sound like a collaboration between Drake and The Weeknd. The track quickly spread to 30 other countries, demonstrating how content can move freely and quickly in a world without geographical barriers.
The music industry is undergoing significant changes, driven by shifts in consumer behavior, technology, and the global landscape. Understanding these trends is crucial for anyone involved in the music industry, from artists and record labels to marketers and fans. As we move forward, it will be interesting to see how these trends continue to evolve and shape the future of music. Remember don’t get too caught up in number of followers and concentrate on fandom. From your fan base and rely purely on social networks. Start a fan club as soon as possible and treasure each and every fan. Remember, you may only need 1000 true fans, not 1 million followers. This is how to grow and survive in the music industry, oh, and a great song.