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How the core repertoire of music profits from online distribution in the Gustaf Store

by Joris Noreillie

A question that often crops up is what the “core repertoire” of a classical musician looks like? And what should it contain for a jazz pianist? Or for a country singer? While not 100% defined, there seems to be a general consensus among experts of the respective genres what should definitely be in it … it is in that train of thought that we started working out Gustaf Essentials: we were tired of not being able to offer Beethoven or Schubert to our classical musicians, and now we can. It’s a matter of covering the base, you know.

The next issue that obviously pops up is related to the size of such repertoire. At neoScores, we discussed this at length, and we’re sure we’ll get a good grip of it over time. We all know the 50 to 100 CDs that comprise the classical canon, and how much overlap exists between these CD boxes. We feel that with one to two thousand scores at most, we can cover 95% of the repertoire a music lover is looking for in a specific genre. We’re working as fast as we can to offer you this core repertoire at our Gustaf Store.

The long tail of sheet music distribution

When looking at the distribution of scores sold, both online and through traditional channels, a typical pattern emerges. It’s a classic Pareto distribution, where the top 20% of songs bring in 80% of all sales. It’s a well-known effect that also gets amplified when migrating from a traditional model to online. One main driver is the ‘unbundling’ of books to individual scores. As even the most popular scores will only cost a fraction of the book it was previously sold in, we’ll see an augmentation of the original skewness. This is shown in the graph at the left hand side.

Sheet music catalog sales distribution with long tail

 

Along with this comes another concept: the long tail. This is the long list of pieces that are rarely bought or played, and that in fact are not commonly known. They are much greater in number than the core repertoire yet make up only a few percentage points of the sheet music revenue.

There is something funny about this distribution when the business shifts from brick-and-mortar to online. While it is not economically viable to keep a stock of infrequently sold scores in a physical store (since it will take up space, require insurance, an upfront purchase from the publisher etc), this does not count in a digital world where the marginal cost of a score is zero. On the consumer side, the few people who are looking for this score have a relatively high willingness to pay (as they won’t find it in their brick-and-mortar store). So in a digital world, keeping infrequently sold scores in stock makes complete sense, and should be actively pursued. That is why, in the same chart shown above, the long tail at the right hand side of the graphs extends much further than in the physical world.

What happens in the middle section? The sub-top sellers in a physical world profit from the bundling effect, which disappears online. It hard to predict, but in the assumption that the same amount of money will be spend in the two scenarios, the mid segment might be the one that suffers. Even in the most optimistic scenario, where online sales will supplement offline and thus lead to a higher revenue for the entire sector, the mid segment might be the place where growth will be lowest.

All in all, we expect that online will not so much disrupt, but strengthen the dynamics that are already present in offline sales. At neoScores, we’re honoured to be part of this evolution. That is also why we chose to build our own Gustaf Store.

 

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