More than one quarter of Dutch CD shops have closed their doors since 2000, said Dutch Entertainment Retailers Association (NVER). Years of decreasing revenues have asked their toll. An additional sales decline of 15.6% in the overall music market over 2010 seems to be too much to handle for some retailers. "In 2000 there were 1,281 music stores and by the end of 2010 there were only 924 left," according to NVER. This was announced Monday in the daily newspaper Metro. Downloading and higher maintenance costs for retailers are among the main causes of this trend. 

Now record stores are disappearing, it is interesting to take a look at alternatives for the costumer. On the short term, customers will have less opportunities to buy music, as physical stores disappear from the shopping malls. This will automatically mean less diversity, and a need to look for alternatives.

An alternative to the record store is downloading music online. However, the range of legally available downloads is still not as diverse as what record stores have to offer. Perhaps this is because the demand for these downloads is still lagging behind. Paid music downloads, according to the NVER, only represent a market share of 8 percent in the Netherlands. Worldwide, about 30 percent of consumers buy downloads. At present, the digital sales are not yet able to compensate the decline in physical sales fully. 

Illegal downloads are still very popular in the Netherlands and are an alternative as they offer an almost infinite range of choice. But clandestine online alternatives may very well be marginalised in the future, as they will encounter stricter enforcement measures. On the longer term, this will lead to an increasing demand for legal downloads and, consequently, to a more diverse supply on the digital market. A Swedish study (Adermon/Liang 2010) demonstrated this recently. Once the demand for legal downloads increases, online retailers will offer a larger array of products and services. From this we can conclude that physical diversity is expected to diminish but this can eventually be taken over by the opportunities in the digital domain. 

Meanwhile, retailers do not expect their ‘tribe’ will completely disappear from the streets. The downward trend will stabilize at a certain point, because the true music fans will keep coming back because they enjoy the atmosphere of record stores. Moreover, people will always have a need for physical products and personal contact, said shopkeepers Kees van Lent and Chris Voorthuizen in Metro.

References: NVER, Metro Feb. 28, 2010