A Brief History of D2C (Direct to Consumer) by Mark Meharry, Founder and CEO of Music Glue
This is my best attempt to document the development of D2C in music. I can guarantee that some of this is wrong, someone will be offended, and many of you will feel aggrieved at your omission, and to you all I can only say – I’m very sorry.
Back in 1996, if I wanted to buy an airline ticket I had to go to a travel agent. Indeed, the only way I could buy a ticket directly from an airline was to go to the airport sales desk. Roll forward 20 years to 2016 and travel agents are all but gone. Even the sales desks at airports are disappearing. Instead, I jump online and head to an airline website and they not only sell me tickets but also cross-sell (whether I like it or not) all plethora of 3rd party products and services including transfers, hotels, insurance, equipment hire, car rental and parking. Furthermore, their systems integrate with aggregation portals such as expedia.com to capture retail opportunities outside of their own marketing channel.
This sophisticated D2C service was developed by an industry that operates on incredibly tight margins, that understands the basic principles of ‘supply and demand’ and ensures that if a customer has their credit card out, they will extract from it every last penny they can. The process of buying an airline ticket has evolved organically based on trial, error, learning and change.
Back in 1996 if I wanted to buy music or band merchandise, I went to a record store. Roll forward to 2016 and, much like the high street travel agents that used to service the airline industry, the record stores are all but gone. So now I shop online. Unlike the airline industry however, the development of D2C in music has been very challenging, with multiple false starts.
So what happened?
This article was published in Record of the Day: Issue 697/ 29 September 2016
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