I recently paid a visit to my local HMV, which is something I haven’t done for a while, but what really struck me was how much things had moved on from when I was a regular browser of the rock & pop section. I knew CD sales were in decline, but nowhere is this more strikingly obvious than in stores like HMV. I was shocked, but not surprised as I observed the obvious difference in customer presence between the music section and every other department – tumbleweed comes to mind.
For a while now, It seems as though HMV have been experimenting with new business models, desperately trying to respond to the increasingly fickle, and ever-changing habits of modern consumers. The first noticeable move was to displace music as the most dominant product. CD’s have long been banished to the far corners in favour of DVD’s/Video Games, but a more recent addition is the inclusion of a technology section. Due to the free-fall decline of physical media, HMV has obviously decided part of their future at least may lie in the technology itself. One thing, however, is clear, If HMV is to survive on our high street – it’s future does not lie in CD sales.
In the UK, large chains such as Zavvi & Virgin Megastore have long decided to pull the plug on their high street presence, leaving HMV as one of the few big players left, and fighting for its survival following a reported pre-tax loss of £38.6 million in the 12months leading up to April 2012.
In Canada, (somewhere I have lived and worked) – I witnessed a steep decline in stores, with many closing at an alarming rate. It appears that HMV will cut their international presence, focus more on the home market, and allow breathing space to establish a new business model.
One potential candidate for the future is their new Cambridge location, which recently opened as a more engaging store, including: a high profile tech department, café with free Wi-Fi, and a music department that includes a selection of vinyl.
Only time will tell if this model works, but it certainly shows promise, and the reason I think so is as follows:
People don’t buy CD’s like they used to for a number of reasons, but in essence – the value of the physical product no longer outweighs the convenience of downloads. However, people do see value in the devices they use to consume media, as well as more boutique items such as vinyl.
The trick is convincing people to buy from HMV, as competition for electrical retail is tough – particularly when you take the online market into account. This is where the café comes in. By its inclusion, you create community, and a reason for people to return. The café will create a space for people to socialise, use their devices, browse the web, and essentially act out the very behaviour that has left the music industry and record stores wondering what to do next. According to HMV the area will also feature a community blackboard for local artists and bands to engage with each other. In return, HMV will hope this translates into increased sales of both physical and digital products. For more details on HMV Cambridge, CLICK HERE.
HMV’s actions have an almost “If you can’t beat them, join them” feel about it, and I really do think it’s the only way forward. You can’t always stop change, and despite my initial resistance to digital downloads – I find them increasingly more convenient. However, to satisfy my love of physical product, the option of buying my favourite titles on vinyl has become increasingly appealing – particularly when you factor in brick-wall limiting and the loudness war.
Due to the limitations of vinyl, the format does not suffer from over compression and lost dynamic range to the same extent as CD’s. So if the future of music retail lies in cafés, MP3s, and I-pads for the masses, with a vinyl section for those who care to listen – well then, I’m ok with that.