How Independent is the Canadian Music Market?
CIMA recently commissioned Nielsen to calculate the 2012 market-share for both Canadian independent and major labels in Canada, broken down by sales of whole albums (physical and digital) and digital tracks. The data gathered paints an interesting portrait of Canadian music sales: though international artists still dominate the market, independent labels are very successfully marketing and selling Canadian music to Canadians.
Overall, 76.5 percent of Canadian album sales and 85.6 percent of all digital tracks were from international artists in 2012, making Canada a largely import-driven international market. 14.1 percent of overall Canadian album sales were by Canadian artists signed to independent labels, which is broken down on the left pie chart below. For digital tracks sold in Canada, Canadian independent labels held approximately 6.1 percent of the market (see Chart A). Canadian artists signed to major labels held 9.4 percent (albums) and 8.3 percent (digital) of the Canadian market.
Chart A: Canadian Indie Sales As a Percentage of the Entire Canadian Market
As the majority of English-Canadian independent labels distribute their albums through major labels, music sales are often attributed to the majors. Nielsen segregated sales by method of distribution: English and French artists signed to independent labels, as well as English Canadian artists signed to independent labels, but distributed by majors. Over 86 percent of album sales and 83 percent of digital track sales by English Canadian independents were distributed by major labels in 2012.
For albums, the majority of sales by independent labels in Canada (7.7%) are attributed to French labels. This means that English Canadian independent album sales comprised 6.4 percent of the overall Canadian market. The vast majority of these sales (5.5%) were distributed by the major labels. Other English Canadian labels held only 0.9% of the album market.
Though Canadian independents have a smaller market-share for digital tracks in general, English Canadian independent labels had the biggest market-share of any non-major label group, controlling 4.9 percent of the digital track market. Most of these sales were by digital tracks distributed by the major labels (4.1%).
If one examines the market-share for Canadian music in Canada closely, it can be seen that the task of creating Canadian music that sells in the Canadian market is being executed extremely well by the independent sector, evident in Chart B. Of all Canadian album sales by domestic artists, just over 60 percent were by artists signed to independent labels. A total of 27.2 percent of album sales in Canada by Canadian artists were from English Canadian independents, while 32.9 percent were French Canadian independents. The remainder (40%) of album sales were comprised by the major labels.
Chart B: Canadian Indie Sales As a Percentage of The Market for Canadian Music
Digital track sales by Canadian artists (in Canada) were largely dominated by the major labels, with independents making up 42.2 percent of this market. English Canadian independents distributed by major labels captured about 28.2 percent of the market, while self-distributing English independents captured about 5.5 percent of the market. All in, English Canadian independent labels sold approximately 33.7 percent (28.2% + 5.5%) of the digital tracks sold by Canadian artists, or just over a third.
In sum:
- For album sales in 2012, English Canadian independents held a 6.4 percent market-share in Canada, which translated to 27.2 percent of all Canadian albums sold in Canada.
- For digital track sales in 2012, English Canadian independents held a 4.9 percent market-share in Canada, which translated to 33.7 percent of all Canadian digital tracks sold in Canada.
- When combined with the French independent market-share for albums (7.7%), independent labels in Canada held 14.1 percent of the market, which translated to 60 percent of all Canadian albums sold in Canada.
- When combined with the French independent market-share for digital tracks (1.2%), independent labels in Canada held 6.1 percent of the market, which translated to 42.2 percent of all digital tracks sold in Canada.
- 86 percent of all English Canadian independent album sales and 83 percent of all English Canadian independent digital track sales were distributed by the major labels.
The data demonstrates two key points extremely well:
- When it comes to creating Canadian albums that Canadians buy, independent labels are market-leaders, though the major labels sell more Canadian-made digital tracks, by their own artists.
- Most of the independent music sold by English Canadian labels is distributed by the majors.
The data gathered here encompasses only sales of 100 or more units.
For questions on the data, or general inquiries, please email CIMA’s Research & Communications Coordinator, Chris Martin, at chris@cimamusic.ca.