Spotify and similar access models are discouraging other forms of music purchasing – not encouraging them – according to a recently-released finding from NPD Group and NARM. In fact, access has been deemed ‘most detrimental‘ to monetization across nearly all demographic categories.
In the above slide, ‘Committed’ fans are the most dialed-in, die-hard music demographic, while ‘Casual’ and ‘Content’ represent the least dedicated. In almost every category, respondents indicated that access decreased their interest in discrete purchasing, sometimes by a very substantial margin.
Here’s another question, posed to the top two most dedicated demographic groups. It clearly shows decreased interest in discrete purchases like iTunes Store downloads, while also correlating that to lowered purchasing overall (fairly or not).
The survey helps to confirm a growing fear for many labels and artists. That is, services like Spotify increase access, but also decrease spending in many situations. Which means less money from higher-returning formats like iTunes downloads, CDs, and LPs.
But free access also includes a range of other services, including YouTube, Grooveshark, and various freebie competitors. And all of these are sapping the juice out of higher-end impulse buying, once a music industry lifeblood. ”New sources of listening, watching, and researching make it even easier for the average music fan to avoid taking ‘high value’ action, e.g. paying either for a CD, download, or subscription,” the researchers noted.