Monday, January 7, 2008

CDs Going the Way of the 8-Track

Reuters reports that album sales sank in 2007, dropping 15 percent. While Josh Groban's Noel and High School Musical 2 sold less than 4 million copies each (small compared to Usher's 8 million albums sold in 2004), overall music sales increased 14 percent with single digital music track sales surging 45 percent. Seems that fragmentation driven by digital distribution is bringing us back to the good old days of rock 'n roll when the 7" single ruled. What will it take to bring back "album rock"? The numbers indicate that younger music consumers may not appreciate the joys of listening to the same artist for 30+ minutes at a time. Or, musicians may be abandoning the form with their labels and producers pushing them toward a focus on the single.

Saturday, January 5, 2008

Obama Leverages Word-of-Mouth

The lead article in Newsweek reveals that Barack Obama's win in Iowa is partly attributable to a strong reliance on traditional word-of-mouth. According to the article, Obama's campaign has been recruiting hairdressers in South Carolina and used high-school students in Iowa to help spread the word about Obama. He has also bucked conventional campaign wisdom and run an entirely positive campaign, never deigning to go negative on his opponents. While the low-tech methods have served him well, Obama's campaign has also leveraged Facebook, as shown by this graph:

Based on Obama's recent, convincing win in Iowa yesterday, a win leveraged largely on an unusually strong turn-out of pro-Obama voters under age 25, we can certainly conclude that not only is Obama's positive message a winning one, but that his ability to leverage both traditional and online social networking is undoubtedly one of the key drivers of his current success.