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The Los Angeles Times notes the irony behind the Grammy nominations scored by Ray Charles’ last album, “Genius Loves Company,” considering that Starbucks was a partner in the marketing and financing of the album and actually sold more copies (350,000) of the CD than any other individual retailer – and did so at a higher price ($15.95) than most other retailers.

The LAT writes that “the role of Starbucks in that platinum success story is more than just purchase-point trivia — it represents the all-bets-are off landscape of the music marketplace in the new age when iPods, streaming media, ring tones, song downloads and file sharing have changed the very idea of music consumerism.”

Certainly Starbucks has been a part of that changing landscape, as it has seen the opportunity to get involved in the music business as synergistic with its coffee business – both the choice of music and coffee can speak to lifestyle preferences, taste and self-image, and those are three characteristics that Starbucks is very big on. It bought Hear Music in 1999 for $8 million, and has not only been producing albums, but also working on systems that will allow customers to mix their own albums at kiosks in its coffee shops.

It also is worth noting that the producers were taking a gamble with the album, because Charles was in his seventies and had lost a lot of career momentum simply because of age and infirmity. That “Genius Loves Company” would be both a critical and popular success was by no means a sure thing.
KC's View:
A couple of questions are raised by Starbucks’ success with the album, and we’d like to answer them…especially because they are relevant to how retailers do business.

Does this mean that the traditional music retailing business is in trouble? Sure…but that writing was on the wall before “Genius Loves Company” came out. Innovations like iTunes and the iPod, not to mention the emergence of online retailers such as Amazon, already had set that scenario in motion.

Was Starbucks selling the CD to people who might not have bought it under other circumstances? Maybe…but that doesn’t really matter. The thing about breakthrough cultural successes is that they often bring in new customers/patrons, managing to cut through the clutter to attract attention. “Genius Loves Company” was helped by the fact that Starbucks was selling it, but it probably also was helped by the fact that Ray Charles died after it was released, making it his final original album. There also was a movie coming out about his life, which added to awareness. And finally – and we hope, most important – it was a flat-out great album.

Quality, we like to think, always has a way of rising to the top, attracting attention and cutting across boundaries. A great singer can do it…and so can a great retailing experience. It’s all about singing the right notes, and providing a soundtrack that resonates in people’s lives.