A first estimate of the damage caused by the current crisis on CD and vinyl sales in France was established by a benchmark player on the market. And the number is important. ” Between mid-March and the end of May, the shortfall will amount to 50 million euros including tax. In volume, the fall in physical sales could range from 90% to 95% over the period ”, entrusts a connoisseur of the sector to “Les Echos”.
Major sanitary crisis due to the coronavirus forces, many specialized points of sale had to close their doors. Suddenly all the releases of albums which bet on important physical sales, like those of French variety, of boxes or compilations are postponed until later.
Of course, albums are still for sale on the shelves of large food stores (GSA) still open, but consumers do not turn to music products on the shelves. People have their heads elsewhere and other priorities … Another sector leader also notes that physical sales from Monday to Thursday of the top 250 have dropped from 146,000 units to 11,000 in the last three weeks.
A net loss of 16% in 2020
Last year, the turnover from physical sales generated by major brands and specialized stores amounted to almost 330 million euros including tax. With the physical sales segment on a downward trend, the industry expected these revenues to decrease in 2020, to 300 million euros including tax.
This shortfall of 50 million euros would therefore cut nearly 16% of the revenue expected over the year. And nothing says that the physical sales market will start on the same basis as last year in June … In any case, the impact will be major for the music market recorded in France. And on the profits of its companies and the income of the successors-songwriters etc.
Admittedly, streaming is today the format generating the majority of turnover, but physical sales (CDs, vinyls) still represented nearly 40% of total turnover (excluding neighboring rights) in 2019.