In 2006, international music officially entered the Chinese market. At the time, Universal Music started operating in China, but media circles didn’t seem to have access to European and American music and were especially fragmented.
Distributors didn’t particularly care for European and American music, and were instead focused on artists like Jay Chou and Super-girl, making the environment unsuitable for the development of international music.
However, the good news was that, despite a 95% piracy rate, physical record sales were still steady and performing well; that year Black Eyed Peas sold tens of thousands of records in China, and foreigners said this was a good achievement.
In 2008, 2009, and the years following, the music industry experienced a serious decline; record sales fell drastically, and digital music started replacing the traditional record as it became the primary service on the market.
In addition, despite the growing number of digital music users every day, these users didn’t bring any real income to the music industry. At the same time, ringtone sales also dropped, and Internet platforms were beginning to form. However, mobile payment hadn’t quite matured yet, so the Chinese business model wasn’t yet suitable for international music.
The record industry’s status as of late has been completely paralyzed.
2015 and 2016 ushered in a landmark era with the first legal copyright, as well as the beginnings of digital sales. Rihanna’s album Anti, released in January 2016, was a milestone because of its capitalization on the global market; it’s currently at 10x platinum on QQ Music, or the equivalent of 150,000 copies sold. This placed Anti at #4 on the international charts and #1 in the Asian market, including Japan.
Ariana Grande is far less popular compared to Rihanna, but that didn’t stop her album Dangerous Woman from also breaking platinum sales on QQ Music within the first 48 hours, topping both QQ Music and Apple Music’s China charts. This was consistent with the album’s performance around the world as it topped the charts of more than 12 countries, and entering top 10 in 19 others.
Why are global synchronization and digital distribution important? These are actually the key to understanding the value of music. International distribution is necessary in the new Internet era of globalization and resource sharing.
Different album release dates in different countries often leads to rampant piracy; even worse is when a single is released when several songs have already been leaked This is very bad news for the artist.
Loyal Chinese fans of European and American music follow international charts; they follow the UK Billboard incredibly closely, and they feel that these international charts will change the Chinese music industry. So while I’m here, I want to emphasize the importance of “data sharing” and the early establishment of an authoritative, credible Chinese list platform.
In both the physical and digital age, the value of music hasn’t been completely realized, so in the digital age, I’m looking forward to the actualization of the true value of music.
Right now, globally synchronized releases and digital distribution as marketing strategies are incredibly effective, more so than ever before. In the past, we only relied on our experience, but now that we have far more data, many platforms have open real-time data disclosure, and we can monitor the effectiveness of marketing and make immediate marketing and investment adjustments as they’re needed, so both the output and the input are now transparent.
In the end, we don’t really know the how great the potential Western music is for Chinese markets; we just have to feel it out. When Rihanna sold 150,000 copies of Anti, we were all surprised and asked, “How does she have that many fans? That’s so many.”
In the past few years, we’ve seen an unprecedented amount of activity and demand in the mainland market for Western music. I’ll illustrate the potential of Western music marketing models with a couple examples. First of all, from the pop culture perspective, Western artists release a few hit singles before dropping their album, whereas Chinese artists seldom do this. Also, it’s not hard to see that more and more commercials are using Western music.
Hit singles also lead to enormous amounts of play, especially with consumer groups in China, so a hit single can attract huge attention in China; for instance, Lady Gaga’s “Poker Face” has 150 million plays, which is the second highest for Universal Music, and Carly Rae Jepsen’s “Call Me Maybe” is in second place globally.
Since streaming is free, the sales conversation rate isn’t too high, but you can also say that Western audiences are willing to pay for their favorite music, as long as it’s good, so if you give them the right path, they’ll pay for it.
We can all see the long-term effects of the longevity of European and American record sales. Taylor Swift’s 1989, released in 2014, is still selling, and has currently sold 300,000 copies in China, second only to Japan. People might say that this was just a hot album, but one great characteristic of European and American music is its diversity in styles; furthermore, alternative and indie culture attracts more and more amounts of supporters.
Thus, if platforms are willing to devote more resources to alternative culture and styles, then it will capitalize on huge business opportunities. We really feel Western culture is rooted deeply and crafted carefully.
There’s been no shortage of outstanding music from the West, but in the past few years, Chinese music has produced less and less great work. I don’t know if others feel this way, but as a result of this shortage in China, Western music was able to fill this absence for Chinese fans, so the next ten years will a period of rapid development for Western music in China.
When looking at consumer culture from another point of view, China is probably one of the worst performers in international music markets, with a global music revenue of $15 billion comes in 19th or 20th place, while the US, with $49 billion, accounted for one third of global music revenue, and Japan, with $26 billion, accounted for 17% of global music revenue.
While the US only has a population of 300 million, China has a population of 1.3 billion and its economy is developing rapidly. Many of its industries rank first or second in the world, so the music industry represents a great opportunity for the future.
With the arrival of the consumer era, the opening of front-end and back-end sales data, legal music platforms, the proliferation of mobile payment, and the economic status of Chinese fans, we’re convinced that exceeding Japan isn’t just a dream.
Obviously, we have higher goals, but as of right now, exceeding Japan is a more realistic and reliable goal. Since the Chinese market and the consumer situation with regard to Western music have great potential, we feel that as the market becomes steadily healthier, that Western artists will devote their energy towards China and grow their popularity here.
translated by Evan Yi
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