Are Deluxe Editions Like Taylor Swift's 'Reputation' Saving Physical Album Sales?

Taylor Swift
Mert & Marcus

Taylor Swift

"In the last few years, we've done more multi-tiered versions of releases than ever before," says the president of Rhino, which released three versions of the Eagles' "Hotel California" last year.

A funny thing happened on the way to the End of the Album: Physical albums are becoming more elaborate than ever, and it appears to be paying off.

According to the Recording Industry Association of America's latest numbers, released last week, sales of physical products including CDs slipped just 4 percent in 2017 (compared to a 16 percent drop the year before), with vinyl sales jumping 11 percent and revenue from collectors items like cassettes and specialist products like DVD-Audio up nearly 20 percent, despite a 4 percent dip in units sold. Increasingly, higher-priced items are holding up the physical business, and they're more popular than you might think.

While most of us think of deluxe editions as special products aimed at a relatively small number of "superfans," deluxe editions in the first few weeks after an album's release can sell more than their standard counterparts, and even account for more than two-thirds of first-week sales, according to several executives. Those sales fade fast. But the revenue they bring in can make such a significant impact on a project that they've become an important part of planning.

"One of the first conversations we have about a project is whether there will be a deluxe edition and what that could provide to fans," says Andrew Kronfeld, executive vice president of marketing at Universal Music Group.

Take Taylor Swift's Reputation, which wasn't available on streaming services when it first came out but was sold by Target in two deluxe editions, each of which came with a 72-page magazine. If there's anything Swift's young fans are less interested in than CDs, magazines would presumably be a strong candidate. And yet these CD-magazine combos, which were exclusive to Target in the U.S., flew off the shelves, although exact numbers are hard to come by since Nielsen Music doesn't break out information on sales for specific configurations of titles.

"It was a well-thought-out piece," says Kronfeld. "When it's done well and there's a real, unique offering, a deluxe album can help drive sales and in many cases will be the majority of sales at the outset."

When deluxe editions first became popular, more than a decade ago, the answer to that question was obvious: Extra content, in the form of bonus tracks or video. Now, as streaming becomes a more important source of revenue for the music business, it's harder to justify setting aside exclusive tracks for one particular retailer. In some cases, though, the desire of fans to buy deluxe editions has less to do with a rational interest in obtaining more music than an emotional urge to demonstrate one's devotion by buying the best possible version of a product. As the rise of streaming makes music more ephemeral than ever, consumers seem to be more interested in its packaging than they were before. This almost certainly plays into the newfound interest in vinyl, since albums aren't likely to sound better on popular turntables than they do on CD.

Deluxe editions have completely reshaped the reissue business, to the point that catalog labels now release multiple versions of almost every project. "In the last few years, we've done more multi-tiered versions of releases than ever before," says Rhino Entertainment president Mark Pinkus.

Late last year, Rhino released three versions of the Eagles' Hotel California album: A single CD, a double CD set featuring a live show from 1976, and a "deluxe edition" of two CDs and a Blu-ray Audio mix packaged in a hardbound book. "We're thinking of three sets of fans," Pinkus says. "The casual fans who want to hear Hotel California sound as good as possible; the fans who are excited to hear the rare content on the 2-CD version; and the über-fan."

Pinkus says Rhino spends as much effort as ever finding unreleased material for expanded reissues. "As the market shifts, it's more important than ever to make those bonus discs great," he says. For most acts, "some material has been released already, so it's trickier than ever to find great material. But we're working closer with artists than ever."

What's interesting about the Hotel California reissues, though, is what's on each. Fans who wants to hear the 1976 show can buy the two-disc set, which goes for about $20, as most of Rhino's 2-CD sets do. The über-fans who spend between $70 and $90 for the deluxe edition get some more music, in the form of a 5.1 channel surround sound mix on Blu-ray Audio. But the limited audience for Blu-ray Audio suggests that the book and the packaging are an important part of the deluxe set's appeal.

The market for 72-page Taylor Swift magazines and $70 Eagles box sets might seem small -- and a bit extreme at a time when streaming is so convenient. But although the business of selling high-priced items to serious fans is hard to quantify, it seems to be growing fast. And once the growth of monthly streaming subscriptions starts to slow -- which will happen in the next five years -- this market could give the music business an important source of growth. If this sounds hard to believe, think how many fans who were reluctant to pay for music a decade ago now shell out $25 for vinyl records.

Building the deluxe edition business won't be easy, though. Only so many retailers carry high-priced items, so labels need to depend on indie stores, Amazon, and their own online shops. They'll also need to devote the resources to make sure they're creating the right packages for the right acts. "A successful deluxe edition needs to be authentic to the artist and the album and the fans," Kronfeld says. "Hell hath no fury like fans on the Internet scorned."


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