Ever since the full release of Lady Gaga’s latest Born This Way album, there have been tons of talks regarding its pricing policy and promo campaigns, which were a combination of multi-level marketing plans and included linkups with everyone from Zynga to Best Buy.
Amazon.com decided to sell the album for just 99 cents per copy on her May 23 release date as part of the promotion of its Cloud Drive Service. The introductory price overloaded their website and to facilitate the customers, they decided to extend the offer for another day. If you check Amazon’s site today you can pickup “Born This Way” for as low as $0.69). How exactly can music such as this cost so little?
According to some experts’ calculations, close to 50% of Born This Way’s 1.1 million sales have come through Amazon, which is an open proof that their low price strategy has indeed paid off. While its success was undisputed, it once again incited debates over the fair price of internet music price. This has frightened other artists, concerned that they too would be required to adopt the same low price internet policy for their music albums in the future.
In a recent interview conducted by The Wall Street Journal, Lady Gaga was quizzed if she agrees with Amazon’s 99 cents BTW price, and her reply was mildly shocking.
The Bad Romance-singer said, “No. I absolutely do not, especially for MP3s and digital music. It’s invisible. It’s in space. If anything, I applaud a company like Amazon for equating the value of digital versus the physical copy, and giving the opportunity to everyone to buy music. It also wasn’t really 99 cents, because Amazon paid the difference on all of those purchases as part of their promotional campaign for one of their new services. I think it’s amazing and it was a really nice surprise and I felt honored that they chose my record to be part of it.”
Billboard.biz reported that the difference between the actual hard copy and the digital copy will be borne by Amazon, whose share of burden of this generosity could go as large as $3.2 million. So why would an astute group like Amazon would make such an obvious loss transaction? The answer is that even though they are losing a chunk of dough on this deal, the customers will become aware of their Cloud Drive service through this action and hence, it will drive many more million users on their website in the future.
But Gaga revealed that such a pricing policy will not be feasible for all the artists, adding that it is something which has to be decided by all the parties. However, she is more than content with her own experiment. “I don’t know if other artists or other companies would want to adopt the same model. Everyone always has the opportunity to sell their music at any price they want to. This sort of happened this way and it’s very exciting,” the Mother monster concluded.
Lady Gaga Born this Way Music Video