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The bodega beat

Is Latin music immune to the trend of declining sales in the industry? It's not -- and that may be progress.

March 10, 2007

'LATIN RECORD Shops Still Thriving," a recent Associated Press headline blared. That may be true for some, but not necessarily for bodegas. Nor has Latin music been immune to the gloomy overall trend in CD sales. Call it the growing pains of a genre going mainstream.

Despite an expanding stylistic palette and hit-makers as varied as Mana, Daddy Yankee and RBD, sales of Latin music are making the same kind of transition as other genres (and other products as well): They are moving from small retailers to big box discounters. Evidence of this trend can be found in the gap between the industry's two main sources of sales data.

Nielsen SoundScan collects sales reports from participating retailers and online stores, and the Recording Industry Assn. of America tallies the number of CDs, cassettes and vinyl records shipped by manufacturers to sales outlets. According to SoundScan, Latin music sales have gone up steadily since 2000, rising from 22 million album-length releases to 37 million. According to the RIAA, however, shipments have bobbed up and down in that period, from 49 million in 2000 to 39 million in 2003 and back up to 56 million in 2005.

What's going on? SoundScan bases its data on reports from retailers with Internet access and electronic inventory systems. Historically, however, a primary outlet for Latin music has been bodegas -- those mom-and-pop stores that don't report to SoundScan. The increase in SoundScan's Latin sales numbers may have just as much to do with the growing role played by large retailers as with the overall popularity of the genre.

A few other factors may help explain the divergent numbers. Brick-and-mortar retailers, particularly new outlets for Latin music, are having trouble gauging demand for the product -- returns of unsold CDs spiked last year, leading to a sharp drop in shipments. Online sales have lagged behind other genres at least partly because Latino households are less likely to have computers and Internet connections. Meanwhile, the genre has been more prone to counterfeiting than most other segments.

Still, with the Latino population growing rapidly in the United States, the outlook for Latin music seems better than for such genres as R&B and hip-hop, which have seen sales drop more than 40% since they peaked in 2000. After all, that demographic shift is what prompted the likes of Wal-Mart and Target to start promoting Latin music in the first place. Even Apple's iTunes Store has gotten into the act, launching a section devoted to Latin music.

These trends may not be good news for the bodegas. But they bode well for Latin music.

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