Cracker Barrel Makes More Selling CDs than Food!
I kid you not! Check it out:
http://www.chainleader.com/article/CA6533927.html
OK, let’s cut to the chase: While they music doesn’t generate as much total revenue as eats, the profit margin is greater. This big margin is what allowed labels historically to gamble and accept a 90% failure rate, and tolerate a parasitic distribution model. Cracker Barrel has cut out the gambling by licensing music from established stars, and eliminated the cancerous distribution network by selling through their own stores – in other words, the gift shop is like a merch table for the restaurant.
This approach isn’t rocket science or genius, but common sense. Any retail merchandiser would recognize the opportunity presented by music. Unfortunately the music business is modelled on 19th century book publishers and carnivals, not modern merchandising. As a result, the entire industry’s chased it’s tail for nearly a century.
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