Following last night’s announcement that HMV has filed for administration, experts have suggested that the retailer could have survived the recession had it acted faster to support the switch to digital.
Speaking on the recent HMV administration filing, Gregory Mead, CEO of global music analysts Musicmetric, has suggested that HMV’s inability to embrace the digital revolution and music lovers’ changing needs has led to its sad, but inevitable, fate.
“Where retailers like John Lewis have embraced the internet – building customers through its Click and Collect service – HMV simply failed to adapt to the changing tastes of music fans and the seismic shift we’ve seen as everything has gone digital”, Mead said.
The Musicmetric head explained that figures from the 2012 Digital Music Index showed illegal file-sharing to be widespread throughout the UK, but it means that there are millions of people wanting to access music online daily.
“The challenge for retailers like HMV has been to find ways to tap into this – but you’d be hard pressed to be able to walk into an HMV store and buy songs directly onto your iPod”, he added.
An exponential rise in online music purchases coupled with the decline of CD sales shows that the way consumers access music is changing rapidly.
“While previously it was all about CD releases as the Sunday chart show, now the most important thing is knowing where your fanbase is and what drives them so you can market to them directly and maximise revenues from a myriad of sources”, Mead said. “The changing face of music, and that digital technology has overhauled the way we interact with records, means that artists can engage directly with fans, meaning physical retailers have needed to evolve as well.”
HMV has failed to evolve at the pace necessary to compete with increasing competition, which has been a large contributor to its three-year decline into administration.
What do you think has been HMV’s greatest downfall? Do you prefer to buy your music in digital or CD format? Let us know via the Trusted Reviews Twitter and Facebook feeds or through the comment boxes below.