Kim Bayley AGM Speech 2016


"Good morning everyone and welcome to the ERA AGM 2016, the 28th annual general meeting of this association since we started back in 1988.


Born in 1988 – that makes us the same age as Rihanna, Jessie J and Adele.


It also means of course that we predate the CD boom and we certainly predate DVD and Blu-ray. Naturally that also means we were around long before the internet or the digital entertainment business.


None of those store-based retailers who first banded together in 1988 could have imagined the business we find ourselves in today.


In those days, streaming was something which happened to your eyes when you sliced an onion.


I am sure they would have been genuinely amazed at how diverse we would become, and what would probably have shocked them most of all is that despite all of the changes we have been through, in 2016 there are more physical entertainment outlets than ever before.


That’s right. In 2015 the number of physical stores selling music, video or games reached an all-time high of around 15,000, and that is despite the rapid growth of digital entertainment which in 2015 accounted for nearly 60% of the total market


Entertainment retailing has certainly changed and so, naturally enough, has ERA.


We changed our structure to reflect the three key retail channels we represent – digital, multiples and indie – and 18 months ago with the publication of the ERA Manifesto we made a decisive switch in the way we address our suppliers on common issues.

We outlined a clear set of objectives from simplifying music licensing to clarifying the muddle of video formats and we have subsequently pursued those objectives in a clear, structured and above all, collaborative way.


Too often in the past there had been a confrontational approach with suppliers. Today we are working with our partners in video, music and in games in a more collaborative way than ever before.


As evidence of that, I am delighted to say that later in this morning’s proceedings you will hear from three of our leading partners in the content industry.


The past 12 months have seen something few of us thought possible just a short time ago. For the third year running the entertainment market has been in growth and not just in aggregate – games, video and music individually all showed growth, driven by the rise of digital and on-demand services.


Naturally growth was not equally distributed. While vinyl albums grew by 68%, portable console games were down 40%. And while music streaming grew 80%, DVD was down 17%.


With different sectors performing in such different ways, our members’ needs are more varied than ever before.


The challenge for ERA is to develop different strategies for the various sectors of our membership.


For our independent members, the focus remains firmly on Record Store Day which I am proud to say remains the most successful new music industry initiative of the past 20 years.  Not only has it led to a renaissance in indie store numbers, it has also driven the revival in vinyl.


As Record Store Day approaches its 10th anniversary in 2017, it continues to develop and grow. Last year we brought on board the BBC as our media partner, reflecting its growth as a truly inclusive national event and we have also created a panel of retailers to help curate the product line-up to ensure it remains as relevant as ever.  Record Store Day continues to be a flagship event for ERA’s independent members.


For our multiple members, one of the core issues has been the sharp declines felt in the physical video business. Here we have reached out pro-actively to film studios to develop strategies to mitigate that structural decline, where we are working on a unique pan-industry campaign to support children’s catalogue next summer.


Our view is that while some decline in physical video is inevitable, there is much we can do to mitigate that decline and manage it, particularly if we work in collaboration with our studio partners.


A particular milestone was our strategy day conducted with BASE, the former British Video Association, which attracted a very high level of attendance from film studios.


We have subsequently followed this up with a joint BASE-ERA insight day and as already highlighted work has already begun on a pan-industry catalogue promotion next year.


Alongside that, we created a consumer-facing factsheet to explain the new Ultra HD format


After the success of the joint strategy day with BASE, we organized a similar event with the record companies trade association, the BPI, which was equally successful and will set the tone for the relationship between us over the coming years.


The coming months will see a number of follow up meetings with BPI members addressing issues as diverse as new artist promotion, digital gifting and the continued development of the multi channel product offering.


Other key initiatives this year have included providing analysis to the PRS on in store music which we hope will inform their new licensing tariffs for retail premises which often seem to discriminate against our larger stores.


After indies and multiples, the third area of our membership is digital which is going through its own period of evolution. While digital represents the fastest growing part of the entertainment market, it is clear that some companies are thriving better than others. Sadly this year we have said farewell to former ERA members Omnifone and Rdio.


The digital agenda has been dominated by chart and data issues and the ongoing aim of simplify licensing.  Most recently we have intervened in the debate over streaming exclusives. What has been striking has been to sit around the table with some of the biggest names in music streaming and to see the maturity and long-term approach to the market they have adopted. While they all acknowledge the short-term temptation to sign exclusive releases, they are unanimous in agreeing that long-term a policy of exclusives could damage the credibility of the whole sector and ultimately drive music fans to pirate platforms.


Given that anti-piracy initiatives with the likes of CCUK, the Industry Trust and BPI remain a longstanding priority of ERA, it would be ironic if exclusives driven by digital services were to be seen to increase piracy.


Indies, multiples and digital services may operate in very distinct sectors of the entertainment market, but one of the areas in which they all work together is in supplying the entertainment industry’s benchmark market data, most notably to the Official Charts Company, our joint venture with the BPI.


Official Charts had had an extremely intensive work programme during 2016 as it has provided ever more detailed industry data and will soon launch the world’s first ever digital video chart.


We also continue to invest in our services for members.  This year we added to our PR and marketing team with the arrival of Lynn Li, Director of Marketing & Communications, whose marketing and video experience perfectly complements the music industry expertise of our long-term PR consultant Steve Redmond.


Among our recent PR and marketing initiatives has been an updating of the ERA brand you can see here on the screens – now in fetching shades of pink and blue – and a relaunch of the ERA website.


We communicate with our members through the website and newsletters, but face-to-face networking remains vital in a people business, and that is why we are supporting an increasing number of events from the highly successful ERA pop quiz to networking events with AIM and the MMF.


Research continues to be a key ERA service to members. We conducted a successful joint research project into multi-channel purchasing of music in conjunction with the BPI, and now plan to build on this research as well as repeat this initiative in video. We also continued our tracking research project, now into its 13th wave. This unique resource generates over 2 million data points which can be accessed by ERA members.


It all adds up to what we believe is a powerful suite of services for members, which has resulted in a continuing growth in our ranks. I would like to welcome all of our new members including the likes of Primark and the Co-op who joined under the auspices of UCA, and Sky, who have not just made a big impression on the video market with Sky Store, but also are already making very valuable contributions to ERA.  We have also welcomed a host of new independents like Bear Tree, Maid in Vinyl, Oldies and Rare Trade in the past few months.


Finally I would like to thank you, our members for making ERA, what it is, a dynamic trade association reflecting a dynamic sector.


Thanks to you, the entertainment business is growing and diversifying as never before. We have many challenges but working together through ERA, we face them together.


It is a pleasure to represent you all…"


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