Play it Again, Sam? Product Differentiation and Success in the Music Industry

64 Pages Posted: 23 Jul 2021 Last revised: 21 Jan 2024

See all articles by Abhishek Deshmane

Abhishek Deshmane

Georgia Institute of Technology - Scheller College of Business

Victor Martinez-de-Albeniz

IESE Business School - University of Navarra

Date Written: July 17, 2021

Abstract

Newly released music is never assessed in isolation by audiences, who tend to compare objective (sonic attributes) and subjective (genre affiliations) elements of its identity with the previous musical catalog of the corresponding artist, her musically proximal peers, and the most successful releases in the market. In this paper, we provide a general framework that disentangles the objective and subjective identities of new musical releases, and evaluates how differentiation affects audience reactions. We posit that radio stations, who seek commercial success, have different preferences towards differentiation in comparison with critics, who grant cultural legitimacy in the industry. Combining play numbers, reviews, and music description data from different sources, we find that radio stations prefer consistency in the musical style of successive releases by the focal artist and especially favor albums that sound similar to chart-toppers. Critics, however, exhibit opposite preferences, preferring novelty compared to past works of the artist, while remaining uninfluenced by contemporaneous music dynamics. Our moderation checks reveal that decisions around genre affiliations and scheduling new releases aid music producers to effectively manage audience expectations for better performance. We show that despite the seemingly contrasting preference structures of radios and critics, artists can identify design-related optimal ‘sweet-spots’ that cater to
both kinds of tastes.

Keywords: New Product Development, Product differentiation, Reference Effects, Satiation, Attachment, Music, Cultural Operations

JEL Classification: M1

Suggested Citation

Deshmane, Abhishek and Martinez-de-Albeniz, Victor, Play it Again, Sam? Product Differentiation and Success in the Music Industry (July 17, 2021). IESE Business School Working Paper, Available at SSRN: https://ssrn.com/abstract=3888525

Abhishek Deshmane (Contact Author)

Georgia Institute of Technology - Scheller College of Business ( email )

800 West Peachtree St.
Atlanta, GA 30308
United States

Victor Martinez-de-Albeniz

IESE Business School - University of Navarra ( email )

Avenida Pearson 21
Barcelona, 08034
Spain

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