On November 1, 2009 MusicGlobalizaton made a bold statement in an attempt to predict the world’s next powerful music markets. Over a year later it appears we were dead on. Australia is BOOMING! Setting pride aside, our suggestion was only half right as the other factors contributing to the Australian industry surge could have only been predicted by Nostradamus. The Australian market is a unique animal, an emerging force which oddly enough is setting the pace for global music. As the world’s economy remains in the toilet and industry numbers plummet faster than Kanye West’s popularity, Australia’s music industry is growing so rapidly they can’t even keep up with the demand. How could this be? We’ve identified 3 key ingredient (excluding our 2009 factors), which has generated this dramatic unforeseeable upswing:
1. Stable Record Industry
There many essential elements in order to have a successful record industry – solid musicians, well run labels, willingness to adapt, and energetic consumers. Australia’s got them all. Starting with musicians, Australia’s loaded with talent that has created new artistic genres which has molded new fans all across the globe. As Australian buyers once trickled into stores to purchase the new Jay-Z, Pink, or Bruno Mars album, they now flock in droves to pick up homegrown acts like Sia, John Butler, or Powderfinger. Better yet, retailers aren’t being snipered off one by one either. As Mom & Pop stores bleed to death throughout the world and even the big box stores are losing, Australian retailers are accelerating. Take entertainment retailer JB-HIFI for example. They currently have 130 stores but plan on increasing their presence by +90% in the upcoming years throughout Australia and New Zealand.
* “Yes” naysayers, it’s true two of Australia’s independent distributors took a dive in 2010, however this was due to financial issues nonrelated to the industry impact.
2. Live Entertainment
Live entertainment in Australia is red hot. The amount of profitable festivals and music venues remains the highest in the world. Why? As the northern hemisphere is shutting down for winter months, Australia is cranking up. The continent’s an excellent outlet for traveling bands to remain active in otherwise down seasons, and better yet, Australian fans are willing to pay and pay big. While American’s are cancelling arena tours due to low ticket sales for seemingly reasonable prices, Australian pricing is comically high, yet sells. The economy is motivated, the Australian dollar is climbing and somewhat stable so people can part with discretionary spending. This, coupled with successful venues and festivals leads to profitable and multi-dated tours. Metallica has 20 arena shows while Australian super group Powderfinger secured 300,000 occupied seats in Australia alone.
3. No Reliance
Due to the homegrown success, Australia, for the most part, can remain unaffect by global industry windfalls. Their unique musical ecosystem does not have to rely upon global sales, global distribution, and artist success abroad in order to be successful. This is abnormal. For example, many countries due to the lack of legitimate promoters and marketing arms rely heavily upon Live Nation to drive concert revues. Australia is cluttered with successful promoters which has essentially made Live Nations arrival irrelevant. Their labels are successful, distribution foundation is strong, and the overall infrastructure is prepared for growth. Better yet, the infrastructure is prepared for digital growth.
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