Listening to Online Music Leads to Sales

Nearly half of the music fans in the US are turning to the Internet to find artists they can’t hear on local radio stations, according to a survey by Yankelovich Partners for the Digital Media Association. Most of these listeners also said that hearing a new song or recording artist online leads them to buy new music at a retail store in their town.

Forty-eight percent of those surveyed said they go online to hear music that is not played on radio stations in their communities. The response was even higher (62 percent) among those who have downloaded and streamed music over the Internet. A majority of the respondents that have downloaded or streamed music over the Internet, 59 percent, said that listening to a song online has caused them to later buy it at a music store or other retail outlet.

As this survey clearly shows, Webcasters offer consumers more choices to quench the thirst of a diversity of musical tastes,” said Jonathan Potter, Executive Director of the Digital Media Association. “And consumers are responding to the diverse offerings by purchasing a wider range of recorded music they would not have known had it not been for the variety of music Webcasters broadcast 24 hours a day.”

Looking toward the future, an overwhelming number of music consumers, 74 percent, agree that most music will come from online sources.

“As technology evolves, business models will follow, and the legal and business rules that once outlined the playing field need to be flexible enough to include this new medium of consumer-driven digital media alternatives, especially when the alternative clearly benefit the music industry as a whole,” Potter said.

Growth in Traffic to Music Sites April to May 2000, at home users
	Unique Audience		% Growth
	April	May
planetofmusic.com	577,908	2,541,726	339.8
eminem.com	156,724	442,313	182.2
napster.com	1,600,000	2,836,064	77.2
BritneySpears.com	269,671	422,679	56.7
LimpBizkit.com	145,916	195,228	33.8
Source: Nielsen//NetRatings

Other findings of the survey include:

• Nearly 80 percent of music consumers would purchase more music if they had immediate information about the artist and title of the song
• More than 60 percent would purchase more music if every time they heard a song they could immediately buy it
• More than 80 percent would like the option of buying songs individually
• Of those who regularly listen to music over the Internet, one-third are more likely to purchase CDs in stores after hearing the music online

Yankelovich surveyed 16,000 Americans age 13 to 39 who listen to more than 10 hours per week and have purchased more than $25 of music in the past six months.

The issue of Internet music and its relationship to CD sales has been a hot topic of late, with music file-swapping software such as Napster coming under fire for alleged copyright violations. A study by VNU Entertainment Marketing Solutions for Reciprocal, Inc. found thatonline music file sharing is the likely cause for a steady two-year decline of college market album sales.

As far as downloading music is concerned, International Data Corp., (IDC) predicts that music downloads will become a multi-billion dollar business in the future, and with most of the nation’s music download junkies less than 20 years old, it seems like a very real possibility. But yet more research by Greenfield Online found nearly two-thirds of the online music shoppers surveyed have not and do not expect to pay for digital music downloads.