It’s shocking to think that Best Buy was once known for being the Costco of CD’s. They really did offer the best prices and while they didn’t carry much of a local or independent selection, it was still a point of pride as a band to be with a label who could broker distribution with the retail giant — Those days are gone as come July 1st, 2018, Best Buy will no longer sell CDs.
Dirty Heads Manager, Cheez, Dishes on Best Buy:
People aren’t as into owning music anymore, and if they are, it’s not a CD and if it is, they’re not getting it from Best Buy. But let’s face it, Best Buy hasn’t been a music resource for years. During the first half of 2017, streaming services accounted for 62% of revenue from the US music market, a number that is only expected to climb with each year. Independent Record Stores have made a comeback with the resurgence of Vinyl, still offering that platform of physical music for the classic fan and collector.
In its day, Best Buy was a cheaper resource to purchase CDs from top tier bands that would appear otherwise over-priced at the local record store. At one time, Best Buy had over 2,000 stores nationwide with the means to purchase a higher quantity at a lower cost. This ultimately made the price per CD cheaper for them to offer fans.
Dirty Heads and Sublime with Rome manager, Mike “Cheez” Brown, shed some specific insight into the now illegal angle that Best Buy took with selling CDs, telling The Pier: “What Best Buy use to do, before the government cracked down on it, is Best Buy would get these CDs and the record companies would cut them deals on it because Best Buy would pay up front — Do you remember when CDs use to be $17.99 for awhile? Best Buy would sell them for $9.99. Best Buy was paying $8.00 to $9.00 at the time for them and sometimes they would even go in on a hot title, like a new U2 record was coming out and Best Buy would sell them for $7.99. Best Buy paid $8.99 for them, but they’re selling them for a dollar less, why? Traffic! So is it worth paying a person $1 to come into your store, ready to open up their wallet? Absolutely, that’s genius! It’s called ‘Loss Leader’ and it became illegal but that’s how Best buy got into selling music. For awhile, Best Buy would have bands come in and do signings, they would have concerts in the parking lot, all kinds of crazy shit. Best Buy sold a lot of CDs!”
What Does This Mean For CDs Moving Forward?:
This story is less about Best Buy and more about what it means moving forward. The trickle down effect of Best Buy discontinuing CD sales is that you may see bands simply opting out of the format altogether. Cheez tells The Pier that the bulk of the Dirty Heads CDs that are printed are sold at Best Buy and without such a retailer, its not all that cost effective to continue producing CD’s.
Moving forward, Dirty Heads will only release music digitally or on vinyl as they currently have no plans to restock any past albums on CD, nor do they plan to use the CD format for any new albums; a trend we could see adapted by many other groups.
There are still the devoted fans who enjoy the digital platform, but look forward to purchasing a CD from their favorite band. It’s typically at a show, or as a merchandise bundle on the band’s website where they hope to have the CD cover or booklet signed. But where are people playing their CDs? Newer model cars no longer have the CD slot and the same could be said for new computers and laptops.
Reports also indicate that Target may follow suit as they may now be offering a consignment only deal and the major labels don’t appear to be interested in that. Cheez explains: “What happens if Target goes bankrupt? The labels have lost all that money and if they do get paid out of bankruptcy, its pennies on the dollar. Those big box stores, like a Target, have 30-60-90 day billing, sometimes up to 120. So if you ship a product, they have 30-120 days to pay. I’d rather just have my money up front and not get the small amount of interest on the 30-120 day interest that accrues.”
No word on where Wal*Mart or other box stores will position themselves but the writing is on the wall. Bands and labels are refocusing their efforts toward streaming, and vinyl. Independent Record Stores may reap the benefits of this change for a short time period, but as time marches on, those same new CDs will likely come back to be resold as used. As a new generation of music makers emerge, CD’s may not even be on their radar for production whatsoever.
Despite no longer selling CD’s, Best Buy will continue selling vinyl for the next two years to fulfill a contract with it’s vendors.
Article By: Mike Patti
Watch: Old Best Buy Ad