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Are CD Prices Getting More Dynamic?

Posted By Barry Ritholtz On August 4, 2005 @ 6:49 am In Finance,Music | Comments Disabled

One of the more interesting items we’ve discussed has been the different pricing strategies [1] that studios use with DVDs versus what the labels do with CDs.

The studios, to their credit, use a form of dynamic pricing — they intelligently recognize that a content item’s value is highest when first released, and then subsequently fades. That’s why DVD prices come down over time, to capture those marginal buyers. The consumers who will not pay $49.99 for Seinfeld Season 1 & 2 [2], might pay $29.99.

The labels have mostly avoided this strategy — but perhaps that’s changing. I had just finished reading a post about Amazon’s conference call, and on it Amazon’s management discussed their Long Tail strategy [3]. I went over to the site, and thru some random clicking and scrolling, noticed this little tidbit:   a long list of interesting CDs for sale on Amazon [4] for between $6 and $10:

Blowout Music Bargains [5]

As Low as $9.99 [6]


As Low as $8.99 [7]


As Low as $7.99 [8]


As Low as $5.99 [9]

I ran thru the entire $9.99 list, and was surprised to see quite a few names worth buying (I have yet to go thru the other lists). I am waiting to hear back from Amazon as to whether this is a new pricing policy, a discount from labels, a loss leader, or a mere inventory clear out.

Here’s my short list of favorite moderate priced CDs off of the Amazon sale:

  • : On And On [10]

    On And On [10] This is a fabulous album; Recall I first mentioned Jack Johnson in December [11]

  • : Stripped [13]

    Stripped [13] — an under appreciated stone album

  • : Tattoo You [14]

    Tattoo You [14] the same — kicked  off the modern Stones, and it rocks


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2005/08/are-cd-prices-getting-more-dynamic/

URLs in this post:

[1] different pricing strategies: http://bigpicture.typepad.com/comments/2005/03/dynamic_pricing.html

[2] Seinfeld Season 1 & 2: http://www.amazon.com/exec/obidos/ASIN/B00005JLEX/thebigpictu09-20

[3] Amazon’s management discussed their Long Tail strategy: http://www.internetstockblog.com/2005/07/amazon_discusse.html

[4] Amazon: http://www.amazon.com/exec/obidos/subst/home/home.html/002-0027102-5040075

[5] Blowout Music Bargains: http://www.amazon.com/exec/obidos/am/002-0027102-5040075?p=tg%2Fbrowse%2F%2D%2F13650871%2Fref%3Damb%5Fcenter%2D7%5F16572901%5F5%2F&l=16572901&c=16572901&i=2976080017&s=1

[6] As Low as $9.99: http://www.amazon.com/exec/obidos/am/002-0027102-5040075?p=tg%2Ffeature%2F%2D%2F567516%2Fref%3Damb%5Fcenter%2D7%5F16572901%5F1%2F&l=16572901&c=16572901&i=2976080017&s=1

[7] As Low as $8.99: http://www.amazon.com/exec/obidos/am/002-0027102-5040075?p=tg%2Fbrowse%2F%2D%2F13650891%2Fref%3Damb%5Fcenter%2D7%5F16572901%5F2%2F&l=16572901&c=16572901&i=2976080017&s=1

[8] As Low as $7.99: http://www.amazon.com/exec/obidos/am/002-0027102-5040075?p=tg%2Fbrowse%2F%2D%2F13650901%2Fref%3Damb%5Fcenter%2D7%5F16572901%5F3%2F&l=16572901&c=16572901&i=2976080017&s=1

[9] As Low as $5.99: http://www.amazon.com/exec/obidos/am/002-0027102-5040075?p=tg%2Fbrowse%2F%2D%2F13617131%2Fref%3Damb%5Fcenter%2D7%5F16572901%5F4%2F&l=16572901&c=16572901&i=2976080017&s=1

[10] Image: http://www.amazon.com/exec/obidos/ASIN/B00008NG5V/thebigpictu09-20

[11] December: http://bigpicture.typepad.com/comments/2004/12/my_year_in_musi.html

[12] Image: http://www.amazon.com/exec/obidos/ASIN/B00005V8PZ/thebigpictu09-20

[13] Image: http://www.amazon.com/exec/obidos/ASIN/B000007O9L/thebigpictu09-20

[14] Image: http://www.amazon.com/exec/obidos/ASIN/B000000W5F/thebigpictu09-20

[15] Image: http://www.amazon.com/exec/obidos/ASIN/B000000W5H/thebigpictu09-20

[16] Image: http://www.amazon.com/exec/obidos/ASIN/B000001DUP/thebigpictu09-20

[17] Image: http://www.amazon.com/exec/obidos/ASIN/B000002B30/thebigpictu09-20

[18] Image: http://www.amazon.com/exec/obidos/ASIN/B000024D4S/thebigpictu09-20

[19] Image: http://www.amazon.com/exec/obidos/ASIN/B0000DD55G/thebigpictu09-20

[20] Image: http://www.amazon.com/exec/obidos/ASIN/B00009PJQX/thebigpictu09-20

[21] Image: http://www.amazon.com/exec/obidos/ASIN/B000003CKH/thebigpictu09-20

[22] Image: http://www.amazon.com/exec/obidos/ASIN/B000002OZS/thebigpictu09-20

[23] Image: http://www.amazon.com/exec/obidos/ASIN/B00005Y1XY/thebigpictu09-20

[24] Image: http://www.amazon.com/exec/obidos/ASIN/B000002MY3/thebigpictu09-20

[25] Image: http://www.amazon.com/exec/obidos/ASIN/B000000OQF/thebigpictu09-20

[26] Image: http://www.amazon.com/exec/obidos/ASIN/B00005R09Z/thebigpictu09-20

[27] Image: http://www.amazon.com/exec/obidos/ASIN/B00000DGUY/thebigpictu09-20

[28] Image: http://www.amazon.com/exec/obidos/ASIN/B000009DDJ/thebigpictu09-20

[29] Image: http://www.amazon.com/exec/obidos/ASIN/B000001DTM/thebigpictu09-20

[30] Image: http://www.amazon.com/exec/obidos/ASIN/B000001FS6/thebigpictu09-20

[31] Image: http://www.amazon.com/exec/obidos/ASIN/B0000062FZ/thebigpictu09-20

[32] Image: http://www.amazon.com/exec/obidos/ASIN/B000068FWC/thebigpictu09-20

[33] Image: http://www.amazon.com/exec/obidos/ASIN/B000003TAW/thebigpictu09-20

[34] Image: http://www.amazon.com/exec/obidos/ASIN/B000002UR7/thebigpictu09-20

[35] Image: http://www.amazon.com/exec/obidos/ASIN/B000084T18/thebigpictu09-20

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