SoundScan's 2015 Half-Year Report: Taylor Wins, Strong Streaming Growth Fails to Stop Album Decline
No doubt remains that it is the year of streaming -- the format has come to dominate music consumption in the U.S.
In the first half of 2015 streaming nearly doubled in popularity over last year, generating 135.2 billion streams, up from 70.3 billion streams in the same period last year. (Some of this growth can be attributed to improved data capture, according to Nielsen Music.)
Audio-only listening generated 58.6 billion streams, versus 33.7 billion last year, an increase of 74.2 percent. Audio's growth was topped by video streams, which accounted for 76.6 billion view-listens, an increase of 109.2 percent from the 36.6 billion streams counted in 2014.
Taylor Swift is ruling the year so far, with 1989 the best-selling album of the first half of 2015 (not to mention topping 2014, too). Last year, 1989 grabbed the top spot with 3.66 million units moved. The album has scanned 1.33 million units so far this year, followed by Drake's If You're Reading This… with 965,000 units. In vinyl sales Swift also reigned, selling 34,000 units. A combined tally of album sales, track downloads and streams leaves Swift, yet again, atop the mountain, totaling 2.011 million album and album equivalent units.
Mark Ronson's "Uptown Funk!" featuring Bruno Mars is this year's top-selling single so far, scanning 4.9 million units. Drake's If You're Reading This... takes the lead on digital album sales, moving (or transferring, if you prefer) 895,000.
Universal Music Group has improved on its industry lead in market share within album plus track equivalent albums (TEA), growing to 39.2 percent of the total market in the first half of the year.
Even in a year of explosive streaming growth, U.S. album sales declined (a relatively slight) 4 percent this year, to 116.1 million in total from 120.9 million in 2014. That makes this the "best" year -- as in, the year with the smallest sales decline -- for album sales since 2012. The same can't be said for track sales however, with downloads falling to 531.6 million units from 593.6 million units, a 10.4 percent drop.
Overall album consumption in the U.S. -- combining track equivalent albums (TEA, whereby 10 track downloads equal one album) plus streaming equivalent albums (SEA, whereby 1,500 streams equal one album) -- saw a 14.2 percent increase, to 259.4 million albums plus TEA and SEA, from the 227.1 million albums plus TEA and SEA in the first half of 2014. Within that, digital was the driving force, as album downloads, TEA and SEA totaled 197 million units, or nearly 76 percent of album consumption, up 23.1 percent from the 160 million combined downloads/TEA/SEA counted in the first half of 2014. Breaking out digital further, albums comprised 53.7 million, TEA comprised 53.2 million album units, while SEA consists of 90.1 million units.
Physical album sales fell to 62.41 million units in the first half of 2015, from 67.3 million in the second half of 2014. CD sales were down 10 percent, to 56.6 million. Vinyl grew by 38.4 percent, to 5.6 million.
That decline means at least one thing: SEA has become the main driver of consumer music consumption, over physical albums, digital albums and track equivalent albums.
While a 4 percent decline in overall conventional album sales may qualify as the category's best since 2012, second-quarter trends indicate that album sales too may be heading south. Album sales were down 1.8 percent in the first quarter, to 60.6 million units from 61.7 million units, but in the second quarter sales dropped 6.2 percent, to 55.5 million units from 59.2 million units.
Plenty of interesting things are occurring within the conventional record market. For one, the pop category appears to be playing a large part in sustaining the market, with scans of nearly 13.2 million -- a 40 percent increase, and nearly 3.8 million more than the 9.4 million generated in the same period last year. That boost is coming from pop albums released last year -- like Taylor Swift's 1989, Sam Smith's In The Lonely Hour, Ed Sheeran's X -- as well as the release this year of Meghan Trainor's Title. All four of those records have sales of over 700,000 units, led by (who else?) Swift at 1.35 million units. Last year, Katy Perry's Prism was the biggest pop seller at 461,000 units, points out Nielsen Entertainment's senior VP of analytics and client development Dave Bakula.
Rock, with album scans of 41.18 million, and R&B, with album scans of 18.24 million, were strong compared to the overall market, with declines of 2 percent and 1.1 percent respectively. Within digital album sales by genre, pop also turned in the best performance with a 37.5 percent increase, but R&B turned in the next best performance, up 14.6 percent. In track sales, pop, which supplanted rock as the largest genre, was the only category to experience a gain (2.2 percent, to 121.5 million units).
Besides genres, new trends are emerging in other areas for conventional albums. Mass merchants and digital download stores, which have been the traditional leaders over the past decade, are stumbling. Besides the download sales decline, mass merchants like Walmart and Target are falling the hardest, down 18.2 percent to 22.9 million from 28 million units.
Yet chain stores and independent stores are faring better than they normally do. Chains, which had been leading the album sales decline for most of the last decade, only fell 6.8 percent so far this year while indie stores, riding the crest of the vinyl resurgence that they jumpstarted, are actually up 0.6 percent to 8.9 million from 8.8 million in the first half of 2014. Meanwhile, the non-traditional CD sector, which includes online CD stores, concert venues and non-traditional merchants like Toys-R-Us and supermarkets, enjoyed an 8 percent increase in sales to 17.33 million, from 16.05 million units.
Overall, download stores comprise 46.2 percent of sales making it the largest category in sales, although the other sectors combined make physical still the dominant format in the sales area. Mass merchants now comprise 19.7 percent of sales, while non-traditional merchants stand at 14.9 percent, chain stores at 11.5 percent and indie stores at 7.6 percent.