The Orchard's VP of global licensing Brad Navin called upon independent retailers to more aggressively launch digital download stores. Speaking on an indie retail panel at the annual NARM convention in Chicago, Navin observed that he hasn't seen many retailers take their brand and translate it to the online world, suggesting retailers could have online success by targeting their local niche audience.

Michael Kurtz, who heads indie coalition the Music Monitor Network, addressed such concerns and said his stores will soon by selling MP3 downloads from labels handled by Redeye Distribution. He added that the stores in his coalition had previously been offering music in the Windows DRM format, a service that was made available in mid-2006. He said selling DRM files did not work, adding that the coalition's stores has sold about $800 worth of downloads by the end of 2006.

The panel, "Winning At the Digital Game," was moderated by Coalition of Independent Music Stores head Don VanCleave, who expressed concern that such digital download stores would not be a large source of revenue for indie retailers. He noted that previous coalition outreaches to the online world were not huge successes, pointing to failed attempts such as download cards that offered fans exclusive content from the likes of Pearl Jam and the Decemberists. VanCleave and Kurtz said fans largely passed on taking the cards.

Jim Logrando, who heads digital development for Redeye, offered other suggestions for merging the online and digital worlds. He reported that one chain just told him that it will be giving customers a branded USB card which they can bring to the store each week to download new music. "It's a novel concept I heard of about 15 minutes ago," he said. He also noted that a recent Apples In Stereo effort, "New Magnetic Wonder," came with a code for free ringtones. He said the promotion was a success, saying he believed the redemption rate was as high as 40 percent.

There are, however, growth areas outside of the digital realm at indie retailers. VanCleave noted that vinyl is 15 percent of the business at most of the stores in his coalition these days, and is sometimes as much as 20 percent. He said labels should continue to invest in the format, and make sure that each LP comes with a code to also download the album.