Music sales, another challenge for Wal-Mart and Target

Posted Jun 24th 2007 12:10PM by Douglas McIntyre
Filed under: Analyst Reports, Industry, Competitive Strategy, Apple Inc (AAPL), Wal-Mart (WMT), Target Corp. (TGT), Best Buy (BBY)

Apple Inc. (NASDAQ: AAPL) is now the third largest music retailer in the U.S., according to a study by research firm NPD. iTunes now has a market share of 9.8% in the sales of albums. NPD defines "every 12 tracks purchased online as equivalent to an album in compact disc format" for the purpose of measuring online sales.

Target Corp. (NYSE: TGT) has now moved behind Apple in market share, and has only 6.6% of the market. Wal-Mart Stores Inc. (NYSE: WMT) is still the leader at 15.8% followed by Best Buy Co. (NYSE: BBY) at 13.8%.

But the retailers are likely to lose their positions to Apple soon, and the days where CD sales made up any significant part of their sales are coming to an end. Research operation SoundScan shows CD sales off 16% this year while digital sales are up 49%.

With same-store sales at multi-year lows, Wal-Mart and its competitors can hardly use one more headache. But, they have gotten one anyway.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Tags: AAPL, Apple, BBY, Best Buy, CD, CD sales, iTunes, music retail, NPD, SoundScan, Target, TGT, Wal-Mart, WMT

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Reader Comments (Page 1 of 1)

6-24-2007 @ 1:18PM

Alex said...

Your article says: "Apple Inc. (NASDAQ: AAPL) is not the third largest music retailer..."

The NDP research says: "Apple iTunes is now the third largest music retailer ..."
The words NOT and NOW are different.

6-25-2007 @ 6:37PM

cliff said...

also something to ask is how many of the itunes items were purchased with itunes cards bought at retailers such as Target and walmart.

if you were to add those numbers into the retailers numbers it would alter the numbers of sales