£1.5 million for a single vinyl record
Why vinyl sales are increasing after a long period of decline and what it all has to do with e-commerce.
London, England, July 2022
Nostalgia is a lucrative proposition. Bob Dylan seems to have recognized this: Recently, the legendary 1960s folk singer released a new song. Strictly speaking, “new” may not be the right adjective – he simply re-recorded his iconic song “Blowin’ in the Wind”. But this one vinyl record far exceeded even the highest predictions when it was sold at auction by legendary British auction house Christie’s London for a stunning £1.5 million.
But the 81-year-old artist’s success with this business venture did not come about just because many of his fans are presumably old enough to enjoy vinyl. In fact, even far younger artists have rediscovered the format. Pop star Billie Eilish, born nearly 40 years after “Blowin’ in the Wind” was first released, sold 73,000 vinyl copies of her second album “Happier than Ever” in 2021. In the first week after the release of her album “Evermore”, Taylor Swift sold an astounding 102,000 vinyl copies, the highest number since at least 1991, the first year vinyl sales were tracked as a separate category. In 2021, US vinyl sales were nine times higher than in 2011. The number of record players purchased is also increasing every year. In 2021, 82,000 turntables were sold in the US, twice the number sold in 2012.
This is where vinyl records and the devices needed to play them become interesting for the e-commerce sector. Because while vinyl collectors pay close attention to the condition and quality of the vintage records they purchase – which is best done when scrutinizing them in person – buyers of new releases can be sure of their physical quality and enjoy the convenience of purchasing them online.
Gen Z is the key driver of the vinyl comeback
Counterintuitively, this trend is by no means driven by nostalgia-smitten baby boomers or Gen Xers (who presumably don’t make up the majority of Billie Eilish and Taylor Swift fans). Instead it is Gen Z, born after 1997, that has rediscovered vinyl records. According to a study, 15 percent of Gen Zers bought a vinyl record in the past twelve months. Only 11 percent of millennials (Gen Y) did the same. Accordingly, the five best-selling records of 2021 include not only Billie Eilish's album, but also those of other youth icons such as Olivia Rodrigo and Harry Styles.
But why are young people, born decades after the heyday of the record player, now flocking to this old-fashioned medium at all? Experts and market insiders see several possible reasons. In general, anything that is analog is currently being hyped by the new generation. Cassette tapes, analog cameras and even those good old Super 8 films are seeing an uptick in demand. In its annual report, music data service MRC Data reveals how experts explain the phenomenon. One advantage, they concluded, was that vinyl records allow the listener to focus more on the music by providing a more engaging listening experience than aimlessly swiping through a streaming library. In addition, many popular films and TV shows are starting to incorporate vinyl records into on-screen scenes again.
The artists themselves have also recognized vinyl’s inherent potential and are adding in-demand add-ons to their vinyl records, which tend to make them more money than streaming services do. The vinyl version of rapper Childish Gambino’s album "Awaken, My Love” came with VR glasses and an app that provided the user with a 360° concert experience. The price? Around US$60. Rap duo Run the Jewels also opted to jazz up their vinyl album with augmented reality features.
Sonos, Ikea, Shinola: Big brands are buying into the trend
This level of success has long since spread to other companies. Sonos, a company best known for its wireless speakers, is now actively marketing the option of connecting its speakers to a record player. Furniture maker Ikea has launched an audio collection that includes turntables. And the ultra-hip lifestyle brand Shinola, primarily known for watches and leather goods, decided to dip its toes into the world of audio products by releasing a record player, of all things. Some companies are also choosing to collaborate directly with artists. Pro-Ject Audio Systems, for instance, released a limited-edition record player called “Master of Vinyl” in collaboration with the band Metallica. This demonstrates that companies have quickly come to the realization, given the trajectory of vinyl prices and sales, that there is an undersupplied customer segment to be marketed – and it is willing to spend some serious money. This also means that the jockeying for the best position in a surprise growth market has begun.