What price a punk classic?
The journey of the Sex Pistols' Never Mind the 
Bollocks from
threat-to-the-world-as-we-know-it tabloid horror in 1977 to a
lifestyle accessory in the picture frame department of John Lewis
department stores is probably not so surprising.
If Johnny Rotten can advertise butter and Iggy Pop can do the
honours for insurance, we've long since ceased to be shocked by the
ability of one-time revolutionaries to be absorbed into the
mainstream.
What is more striking is John Lewis's ability to command a price
premium on this product.
Never Mind the Bollocks and the 19 other titles John Lewis is
stocking alongside Art Vinyl frames costs £20 for the vinyl LP plus
CD in slip case combination.
Contrast that with the current pricing of a Never Mind the
Bollocks CD on roughtrade.com (£6.99), hmv.com (£3.99) and
amazon.com (£3.89) or the price of the download on iTunes (£4.99)
or amazon.com (£3.00) and the scale of disparity is clear: John
Lewis is securing more than six times as much cash from the
consumer for exactly the same music as the cheapest conventional
music retailer.
The cultural value of Never Mind The Bollocks is a question for
another day, but in terms of market value, John Lewis is doing
something quite magical - it's taking something other retailers
believe only to be worth £3 and selling it for £20?
How can they do this? And are there any lessons from it for the
wider market?
***
I have worked with Art Vinyl's creator Andrew Heeps on and off
for the past four years. From the beginning I was intrigued by the
way that putting a piece of music - or rather a 12" vinyl sleeve -
in a new context, a frame, could transform its perceived value.
Art Vinyl's Play & Display frames cost £39 direct from
the AV website. A 'gift pack' which includes a vinyl album retails
for £51.
The consumer seems to have little problem with these prices -
the company's most successful SKU is a three-pack of frames which
retails for £99. Yet what has been consistent throughout this
period has been the scepticism and sometimes downright hostility of
many in the music industry towards Art Vinyl's pricing model.
"It's too expensive," they say. "People will never pay
that."
But of course they do. And over the past four years the company
has sold more than 100,000 of its frames.
Art Vinyl's response has been to focus on other channels -
particularly the design and interiors market. Art Vinyl frames have
been stocked in Selfridges, they are in the Conran Shop, in the
V&A shop and now, the biggest leap forward yet - in 24 John
Lewis department stores.
Sure enough, when Art Vinyl approached labels about securing
supplies of vinyl albums for John Lewis the issue of price came up
again. "Are you sure? £20 is just too much."
Their scepticism is understandable. Music - like DVD - seems
stuck in an endless downward spiral when it comes to price. At
times it seems like the industry's only effective marketing tool is
price-cutting.
The John Lewis thought process is somewhat different. It didn't
set out wanting to sell music. It wanted to sell frames, and
compared with other picture frame products, Art Vinyl is not
particularly expensive.
But how to catch the eye of customers? You have to put something
in the frame.
Hence for John Lewis music is simply an accessory for the
frames. But 12" vinyl records take up a lot of space and so need to
be priced at a level comparable with other items in the store,
hence the decision to create a unique SKU which combines CD and
vinyl LP in order to justify the higher price.
It's the exact opposite of what much of music retailing has
become where the game seems often to be simply to buy and sell at
the cheapest possible price.
***
There are three elements which allow John Lewis to achieve its
£20 an album pricing.
First, the retailer brand. Just as traditionally HMV and strong
independents have been able to claim a price premium for their
service and product range, so too can John Lewis. The department
store may be famous for its 'Never Knowingly Undersold' price
offer, but cannily it seeks to sell unique, value-added products
like the vinyl-plus-CD combination which simply aren't available
elsewhere.
Second, context. Sell music in a music store and you cannot help
being compared with other music stores. Sell it in a picture
framing department and the context is far more favourable.
Third, and most importantly, it's not selling music, it's
selling something much valuable, it is selling an expression of
people's identity. Much like the ringtone business at its height
which paradoxically was able to sell a 30 second clip of a song for
more than a full track, Art Vinyl's flip frames give consumers a
way of expressing who they are through music.
Stick the sleeve of Never Mind the Bollocks or Nevermind or Rio
or the Velvet Underground & Nico on your living room wall and
you're making a statement of who you are and how you want to be
seen.
***
So what's the relevance of this for everyone else in the music
business? Clearly not every record shop can become a picture frame
store. But it is a reminder that there is another way, and it's yet
further evidence that the old music industry rallying call 'it's
all about the music' is mistaken and quite possibly
self-defeating.
People do not just want the music - or if they do, it is not
something they value particularly highly these days.
It is context, packaging, merchandising and the ability music
gives for consumers to express themselves which really generate
value these days.
And that's as true of Art Vinyl as it is of turntable.fm.
What the entertainment retailing market really needs right now
is a mass market product which can generate the same kind of
engagement these more niche plays are clearly delivering.