We’re living through the merch bundle wars

And Nicki Minaj is kind of right.

August 23, 2018
We’re living through the merch bundle wars

At the start of her Queen radio show on Thursday, Nicki Minaj introduced a new sales tactic for her album, Queen. It’s called the Queen’s Priority Pass and for $10, the same price of a single album, it grants access to upcoming exclusive merch, priority entry into future concerts, and, most importantly, a digital download of Queen. The pass came as a bit of a concession for Minaj, who just this Sunday argued that Billboard should change its rules concerning counting albums sold within merch and ticket bundles.

She made her case in a series of tweets, “Travis sold 200K in his first week of clothes alone,” she wrote, claiming that a vast majority of people only bought his album Astroworld because it was bundled with exclusive merch. And she was partly right — Scott and his team came up with an ingenious plan. Every day for the nine days following Astroworld’s release, Scott unveiled new pieces as part of a 28 item line. His website updated every 24 hours and once the new merch popped up, yesterday’s tees and ashtrays and slides disappeared. On the last day of the drops, August 10, the same day Nicki released Queen, Scott unveiled a t-shirt designed in collaboration with Virgil Abloh. A day later that, too, disappeared and was replaced with a whole new line of merch, this time for his Cactus Jack label and Astroworld tour. Every purchase came with pre-sale access to concert tickets and a redeemable download of Astroworld. The hypebeasts came hungry, and Scott fed them, all on his way to a number one album.

In Astroworld’s debut week on the charts, it sold 537,000 equivalent album units, how Billboard refers to a mix of streaming counts and true album sales. The majority were traditional album sales of which there were 270,000. There were also 261,000 streaming equivalent albums (SEA), and 6,000 track equivalent albums (TEA). In the second week, he followed it up with 78,000 traditional albums sold, 125,000 SEA units and 2,000 TEA units.

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Given the fact that almost no stores sell physical copies anymore and very few people are on Amazon or Apple Music buying full albums instead of streaming them, it’s safe to assume that most of those traditional album purchases came from redeeming merch and concert ticket bundles. Minaj had also bundled her album with merch, even offering limited edition Don C designs, but at nowhere near Scott’s scale. So in response, Minaj tweeted, “Travis sold over 50K of these” --referring to concert presale access-- “With no requirement of redeeming the album! With no dates for a tour, etc.” And then, “Billboard says they’ll change the rules cuz of this, so it should be changed now!”

In the past, Billboard has made it clear within chart announcements that an album offered as part of a bundle only counts towards a sale once the buyer opts-in and redeems it. They’ll also note when a majority of an album’s sales came from a specific, atypical source, like earlier this year when Fall Out Boy’s Mania went number one in part thanks to above-average vinyl sales. But neither of Billboard’s two articles about Astroworld’s chart position mentioned either. Chances are that the rules haven’t changed with regards to redeeming albums, as Minaj suggests, but when we reached out to Billboard for comment, we received no response.

Still, Billboard has made changes to its rules before for similar reasons. Prince was actually the first artist to bundle his album with a concert ticket. In April of 2004, he released Musicology and from March to September of that year, he set out on tour. At every show following the release, he gave away the album, so a ticket purchased also counted as an album sale. Billboard estimated that those free albums accounted for about 25 percent of Musicology’s total sales and Prince remained on the chart for 28 weeks.

But Billboard came to regret the decision. In the June 5 issue of the magazine, chart editor Geoff Mayfield wrote that concertgoers “must be given an option to either add the CD to the ticket purchase or forgo the CD for a reduced ticket-only price” and that CD price should be “comparable to reasonable and customary retail pricing." From then on, fans would have to opt-in and redeem their album before the sale could be counted towards the album’s chart position. Prince wouldn’t get kicked off the charts this time, but no future artists could follow the same tactic.

It wasn’t until years later that Billboard had to confront the issue again. This time, it was 2012 and Madonna offered a copy of MDNA as part of a ticket bundle to her tour. The first week of its release, MDNA hit number one with 359,000 copies sold, more than half of which came from ticket bundling. But the next week MDNA went tumbling down to eighth on the chart, selling only 48,000 copies. People noticed that the bundle provided an artificial first week boost, and although some chart followers didn’t love the practice, labels did, and so it took off.

The method was particularly well suited for more established artists who had built-in fan bases ready to see them live, but less in a hurry to buy new music. In 2014, Tom Petty and the Heartbreakers landed their first ever number one album by bundling it with concert tickets. This March, an 18 month old Bon Jovi album beat out Black Panther: The Album for the number one spot after his concert tickets went on sale. It was so strange and so delayed that even Billboard felt the need to clarify how weird it looked. Chart Beat reporter Keith Caulfield wrote, “The surge back to No. 1 is owed nearly entirely to sales generated by a concert ticket/album sale redemption offer with Bon Jovi’s upcoming U.S. arena tour.”

Having seen how well it works, labels and artists are stretching the rules deemed legal by Billboard to greater and greater extremes. Albums aren’t just bundled with tours, but also with coveted, resellable merch, like Scott. And with tickets to a Yeezy season fashion show, like The Life Of Pablo.

Earlier this week, in a move that very likely inspired her labelmate's Queen’s Priority Pass, Ariana Grande started selling a piece of plastic shaped like a cloud and hung around a necklace that’s actually just a tchotchke marketed as presale access to a tour she has yet to announce or release any information about. That’s wild because pretty much everyone with a credit card or a bank account can somehow work their way into a presale. Same as Minaj’s, the item is sold for $10, the same price as buying the actual album, and also comes with an album download, which is emailed immediately upon purchase. But the price of the necklace doesn’t change whether its buyer download the album or not, so depending on how you look at it fans are either paying $10 for presale access and getting emailed a free album or paying for the album and getting presale access included.

In either case, it makes little sense to buy albums today outside of a bundle, where they’re essentially being offered for free alongside something else of value — which is where Apple Music and Amazon might get left behind. Music is simply not enough to sell albums anymore.

Chart critics and insiders have grumbled about the practice in the past, but they’ve been mostly ignored until this week when Minaj brought up the very same question: should these bundled albums get counted differently? It wasn’t her first time calling out a sales-measuring service for their rules, either. Back in 2015 she took to Twitter and Instagram to argue that RIAA, the company that certifies platinum albums, should also count streams towards album sales, a practice that Billboard had already adopted. Three months later, that February, RIAA adopted the change and started counting streams towards album sales.

Minaj might just spark an adjustment here too. We’ll have to wait and see what Billboard decides, but for now we’ll offer a possible solution, inspired by Chris Molanphy, a chart analyst who hosts Slate’s Hit Parade podcast. Back in 2011, in an attempt to compete with the far more dominant iTunes, Amazon offered Lady Gaga’s Born This Way album for 99 cents. The album hit number one, selling about 1.1 million copies in its first week.

But industry insiders were upset. It came out that something like 440,000 of the sales were purchased through the 99 cent offer and critics thought that those shouldn’t be valued as regular purchases because they were basically given away for free, which hadn’t counted since Prince. Months passed and at the end of the chart year Billboard announced a change in the rules: from now on an album sale would not count if it cost less than $3.49 in its first four weeks. Bill Werde, then Billboard editor in chief, wrote, “free or almost-free albums don’t represent a marketplace.”

According to that same logic, the albums that become redeemable because they’re attached to other purchases might also not represent a true music marketplace. As of today a $65 Astroworld t-shirt costs $65 whether its buyer opts in to download the album or not. The same goes for concert ticket prices and $10 priority passes. It would make the most sense, according to existing rules, if a bundled album sale only counted towards the charts if its buyer paid an additional $3.50 to purchase it. Or, at the very least, if it came with a note on the receipt saying $3.50 of the purchase is going specifically towards the album.

The reality is that if the album cost something extra, even just $4, it’s unlikely that most people would buy it, and that’s just another way streaming has upended the industry. The traditional album sales as reported by Billboard would be far lower, sure, but the streaming numbers would instead reflect how we actually listen to and purchase music, not t-shirts and accessories and merch, today.

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We’re living through the merch bundle wars