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Consumers Buying Music CDs After Sampling

With continued declines in the global music industry that amount to a nearly 25 percent reduction since 2000, recent research from Ipsos now reveals that the proportion of Americans who have purchased CDs in the past six months has dropped approximately 15 percent since 2002.

The Ipsos study also shows that while this decrease is largely attributable to shifting consumer behaviors toward digital music acquisition methods, a majority of Americans continue to purchase CDs by their favorite artists. However, they frequently rely on music downloading for sampling new and unfamiliar music.

The most recent wave of the Ipsos quarterly digital music tracking program, "TEMPO: Keeping Pace with Digital Music Behavior," includes an in-depth examination of fee-based music consumption across physical, online, mobile and satellite channels. Key findings from this recent study include:

- Half (51 percent) of U.S. consumers aged 12 and older purchased a physical CD in the past six months. This represents a decline of roughly 15 percent since 2002, when approximately 60 percent of consumers reported doing so.

- Although overall CD purchasing has declined in recent years, the proportion of Americans purchasing physical CDs off of the Internet has increased, perhaps reflecting both the gradual reduction of retail music outlets in America coupled with increased consumer comfortability with e-commerce.

- The average number of CDs purchased in the past six months is just fewer than three (2.8), and the average total number owned is 78. Teens own the fewest CDs (average of 32), while those consumers aged 18 to 54 own considerably more (upwards of 100).

- For new releases from a favorite artist, physical CDs remain the primary method of acquisition among U.S. Music Downloaders aged 12 or older.

- 62 percent of U.S. Downloaders purchased a physical CD of their favorite artist’s last release versus just 28 percent who paid to download one or more individual tracks.

- Among those who acquired music from this release via more than one channel of acquisition (8 percent of U.S. Downloaders aged 12 and older), a-la-carte downloads were most likely purchased first by 45 percent of these consumers, while only 27 percent purchased the CD first.

- When examining purchases of new music by unfamiliar artists, TEMPO found that 23 percent of U.S. Downloaders purchase a-la-carte digital tracks from unknown artists, but just 17 percent purchased the full-length CD.

"Given the persistence of physical CDs as a means of music acquisition among current Music Downloaders, one might ask how music sales can be down over 20 percent since 2000" comments Matt Kleinschmit, Vice President of Ipsos Insight.

"Data suggest that the answer lies in what could be referred to as the impulse gap. Namely, that the increase in the number of digital music acquisition options -- including on-demand downloading and easy unfettered copying -- have slowly eaten away at consumer impulse music purchases, thus creating a gap in revenue. Where in the past someone may have purchased a CD from a new or unfamiliar artist on a whim, they are increasingly more likely to digitally sample the music before deciding to make a full physical CD purchase."

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