So you guys know now that I work closely with musicians, venues and other music industry related professionals. Nearly everything to do with the music industry and how we listen to music is a luxury and not a need. Rent needs to be paid, internet needs to stay on, and well, I like a full tummy.
With the economy slowing (for Gen-Y?), the dollars we have to spend on these luxuries is slowing disappearing and possibly depleting.
Results from NPD’s upcoming “Entertainment Trends In America” report showed that:
37 percent of Americans believe they will spend less on entertainment products and devices in 2008 versus 2007, compared to just 18 percent who anticipate spending more. (NPD Group)So what about the youth?
We are all carrying cell phones, laptops, iPods and other tools and we are also loading them up with accessories, music, movies, programs, games and more at a rapid pace. Is our spending going to shrink as well, or did Gen-Y create a budget for these things like they are necessities?
Gen-Y budgets for gadgets and electronics.
Gadgets, computers and electronics have been around for our whole lives. We know no other way. That is partly the reason I bought a new MacBook before a new car. That's why my iPod is full of songs and my fridge is 1/4 full.
Where is everyone else's money going?
The NPD study also showed that individuals who were going to make an increase in entertainment spending were going to buy new devices (consoles, tv's and players) and not new media (CD's, DVD's).
But then, what are you going to play on your new iPod or BluRay player? Unfortunately for music labels and even movie studios, these mediums are still easily bootlegged and illegally downloadable. (Should artists really be all that worried, Derek Sivers of CD Baby thinks not)
What abut XBox and PS3 games? It's a little tougher, if not impossible to steal these games. Kids are going to need to load up in order to maintain their ADD tendencies.
The challenge for the entertainment industry and the fight for your dollar
Sales in a great deal of industries is down. We're seeing it with magazines and ad revenue, CD sales and movie tickets, the real estate and construction industries and so much more. Oh and gas ($3.51 today, WTF Bush, get your shit together already)!
With everything that is going on, and the fact that it's election year (don't get me started), where are the youth dollars going to go? NPD says that 30% of teens are going to spend more money this year on entertainment than in 07. That's good news for the industry as kids and even some younger Gen-Y'ers still have a somewhat disposable income.
Now if marketers could only get you to buy their product over their competition. But with advertising budgets disappearing, how are they going to reach the kids? Oh yea, a little thing called Social Media. And that folks will be tomorrow's topic!
So folks, where are your dollars going this year? Bills, music, entertainment, savings, vacation? Let's form our own opinion.