Renaissance for vinyl records – Harvard Gazette

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Streaming accounts for around 85% of current music consumption, but vinyl record sales have increased steadily over the past decade, due to their rediscovery by Gen Z members who see them as a timeless medium with richer sound quality. In fact, vinyl’s popularity has grown so rapidly over the past 18 months of pandemic home containment that many pressing factories around the world are receiving orders through 2023.

The Gazette spoke to Caren Kelleher, a 2010 Harvard Business School graduate who left Google to start a baling plant in Austin, Texas, in 2017, and Ryan Raffaelli, Marvin Bower associate professor at Harvard Business School, to learn more about the vinyl renaissance. The interview has been edited for clarity and length.

GAZETTE: Why have vinyl records regained the favor of young consumers?

KELLEHER: You now have a generation of children for whom music has always been a free commodity. The more we talk to students and teens about why they buy vinyl, the common thread is that having vinyl in your dorm or home says a lot about you and who you are.

I think last year when we saw explosive growth in vinyl, it has a lot to do with people being home and saying, “I’m here a lot. I want a vinyl record player. It’s cool. It speaks to who I am outside of Zoom windows.

Vinyl is really interesting because I can’t think of a lot of other products that kids would buy that were cool for their parents. Usually it’s like, “Oh, my parents like that stuff. I do not like it. But vinyl really transcends all generations.

GAZETTE: In its heyday, pressing a record was relatively easy. The major record companies had factories to make sure they had enough product to store the record store bins. What does the landscape look like today?

KELLEHER: In North America, I estimate there are probably 20 plants of different sizes. You have the big ones like the United Record Pressing plant in Nashville and Erika Records in Los Angeles that could have 20 machines, which do a lot of work for the majors. The majors no longer have their own manufacturing facilities, and they are the ones who take up most of the capacity. Most vinyl pressing takes place in Europe. There are probably six or seven huge factories in Europe.

GAZETTE: The unexpected increase in demand during COVID has resulted in huge manufacturing delays, even forcing stars like Taylor Swift or Adele to wait months for vinyl copies of a new release to be rushed. What was your experience?

KELLEHER: I don’t think it’s necessarily related to the supply chain. Some of them are. For example, I placed orders for new machines in March. In a normal world, he should have been there in July. We’re not going to have it until January because the parts are harder to find; there are restrictions on the number of people who can be in a machine manufacturing plant. We are struggling to get parts for the machines.

But what has happened to us is that most of our customers are increasing the volume of their orders. They’ll say, “I only want 2,000 records. “They will place the order and then say,” We sold this too fast. We need 6,000. So all of our capacity planning has been disrupted by demand. Because the capacity is so hard to come by, I see record companies panicking more than they normally could, as most North American pressing factories don’t take new orders until 2023 at this point. . If you can find the capacity, people take it.

GAZETTE: How long does it take to fill an order compared to before the pandemic and why?

KELLEHER: We have an average of six weeks lead time for all projects in 2019, 12.5 weeks in 2020, and 27 weeks in 2021. Orders are larger. If a machine part breaks and it takes us longer to get it, it means we’re down for longer. There have been supply chain issues. We had a shortage of cardboard. We had to wait eight weeks for the boxes which normally arrive here in two weeks. The cost of plastic has also increased by about 30% year over year, largely because of freight surcharges. This plastic comes from overseas, and it’s kept in boats outside of Long Beach and LA.

GAZETTE: Given how trendy it is now, will vinyl continue to grow after COVID?

KELLEHER: I don’t see vinyl going down again, but I’m concerned that as an industry, if we can’t get more capacity online to reduce spin times, fans will move on to other ways to spend. money, whether it’s cassettes or digital. content. I am concerned that the growth of the industry is limited by capacity.

GAZETTE: Why are a few older technologies, like vinyl, fountain pens, and mechanical watches, experiencing a renaissance when most are not?

RAFFAELLI: When you see re-emerging technologies re-entering the market, it’s largely because their value extends beyond the use value of the product itself. Meaning: There are other values ​​that the consumer attaches to the product or to the experience of using the product that become essential. There is a cultural component to this; it can often be linked to s. There is an emotional element to using the product. It is often a question of reconnecting with one’s past or of nostalgia. But it’s not just that. For products of pure nostalgia, you have collectors. But it’s a very small group. They will often end up disappearing as they age. But that’s not what you see with vinyl, fountain pens, independent bookstores and mechanical watches.

The re-emergence of technology is really a redefining strategy. It’s about redefining the product as something more than just the means by which you use it. For watches, it wasn’t just about precision, it was about precision and craftsmanship. The most precise is, if it is made by hand, it demonstrates excellent craftsmanship. But if you compare it to a quartz watch or an Apple Watch, it is 30 times less accurate. So you have the use with a redefinition, and a recombination with something else. This then allows you to redefine it on its own terms. It is no longer in direct competition with new technology. It is something very different.

GAZETTE: Vinyl technology hasn’t changed much, so how is it redefined?

RAFFAELLI: I think the key is, where is the value attached to this notion of authenticity? For vinyl and some of those others, it depends on how the product is made. In watchmaking, for example, the idea that there could be automation, but still assembly by hand, is very important. The more you move towards handmade, the more it becomes an art form, and the price can go up. This is a key differential. When craftsmanship becomes part of the value proposition, as a manufacturer you wonder how to preserve craftsmanship while producing it?

On the consumer side, it’s a whole different thing. This is how the tastes are made and then how the producers sell them to the consumer. If you look at vinyl right now, it’s a very small segment of the market, but it has a very important symbolic role. The vinyl record is an extension of the profession of making music, another way of connecting with the consumer. And it is a specialty product. So even if consumers don’t buy it, the reason artists care about vinyl is because it’s an extension of their craft and a medium that communicates the care that has gone into creating their art. in the first place.

GAZETTE: With such high demand and long lead times for product release, should Caren and other manufacturers be concerned that consumers are moving on?

RAFFAELLI: Whenever demand exceeds supply, especially for a cultural product or a product considered to be art, it often increases the demand even more. Over the past 10 years, Rolex has experienced huge supply issues and this has only increased the demand for Rolex watches tenfold. This only exacerbates the mystique and extends beyond the use value of the product itself. So my feeling is that as long as artists communicate how they want the consumer to see them through vinyl, the delays will only help.


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