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The Economics of the Grammy Bump

iStock 000011475616XSmall The Economics of the Grammy Bump

This Sunday welcomes back arguably the most exciting of the major American award shows, the Grammys. They’ve only gotten more exciting in the past few years after a few notable changes: condensing the once bloated total nominations from 109 to 81 this year and only presenting a dozen or so major awards during the broadcast to focus on musical performances.

Another huge factor for last year’s successful broadcast was the night’s big winner, Adele. She won six Grammys for her multi-platinum album, 21, and certainly pushed the awards to have such a big year. But, in a seemingly unintentional ‘you scratch my back I’ll scratch yours’ relationship, the Grammys always help out the winners and nominees with the aptly dubbed “Grammy bump.”

This tightening of the awards have been paying off big for the ceremonies too; although it’s partially because of the tribute to Whitney Houston, last year’s Grammys were the second highest viewed broadcast of the event totaling 39.9 million viewers, shadowed only by 1984’s awards, the year Michael Jackson won eight awards for his album, Thriller.

The idea is pretty straight forward – artists who are nominated, win or perform receive a significant bump in album sales in the following weeks after the awards. This sounds pretty obvious when you think about it, but the dramatic way the sales jump wasn’t fully comprehended until the Washington Post made an interactive graph showing how album of the year winners get a boost in sales. It’s only gained more prominence after the biggest recorded Grammy bump happened last year for Adele. After selling 237,000 copies of 21 the week before winning, the album sold 730,000 more after, a difference of 493,000 in week, which is saying quite a lot in the age of pirating music and digital downloads.

She wasn’t the only one either. Dubbed “the Grammy Effect” on Grammy.com, the site notes significant sales jumps for other performers, nominees, and even artists who just presented. Last year’s best new artist winner, Bon Iver, saw a 61% jump in sales the following week, while a little known (at the time) folk duo The Civil Wars won two awards and saw their sales jump by 178%. You don’t even have to be a big winner to see the benefits of this either. Artists who perform or are just nominated tend to see a healthy jump in sales too. No amount of crooning could get Bruno Mars an award last year, but he did see his album “Doo-Wops & Hooligans” move up 22 spots on the charts to #8, and Grammy.com reported his sales jumped up 133%.

This is a cool economic factor in the music industry, but the phrase “music industry” has become a laughable term since the rise of iTunes and torrent sites like the Pirate Bay. However, the Grammy bump is influential on digital sales also. 2013 album of the year nominee Mumford & Sons may have walked away meritless in 2011, but their debut album “Sigh No More” had 31,000 iTunes purchases through their Sunday night performance compared to the 25,000 units they moved the entire week  before the ceremonies in digital and physical sales. If it’s not hard sales then it’s at least extended exposure for emerging artists like Mumford & Sons was in 2011, or last year’s best new artist winner Bon Iver.  Rdio, a music streaming site similar to Spotify, reported that Bon Iver’s songs spiked 121% more interest after he won his two Grammys. There have also been reports showing artists gaining significantly more likes and followers on their Facebook and Twitter pages post-Grammys.

The Grammy bump is tried and true, and it’s only become more of a reason to grace American music’s biggest stage with social media and digital downloads at stake. It either means a boost in interest for up and coming artists or an even bigger break for well standing artists, and it’s a good mix from both of those categories this year. Veterans Jay-Z & Kanye West each have six nominations, so a win for them would only expand their empire, but new comers Fun., Mumford & Sons, and Frank Ocean also have six nominations apiece. Seeing how this is Mumford & Sons’ second time being nominated, they would only confirm their status in the industry, while a win for Fun. or Frank Ocean would extend their already impressive debuts.

Which artists are you hoping to see take home an award this year?

 

 

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