Big Boxes

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This is Celia Hirschman for On the Beat on KCRW.

Last Tuesday, legendary heavy metal band, AC/DC, released their latest album in eight years, an exclusive with mega retailers WalMart and Sam's Clubs. In the first week, the band sold over 780,000 CD's. It's the first Number One record for the Australian group and the fastest selling album this year for WalMart.

The band, most known for songs like "Dirty Deeds Done Dirt Cheap" and "You Shook Me All Night Long" is on a major roll, thanks to their new deal. This weekend, Walmart will launch another exclusive with them: AC/DC Live: Rock Band Video Game. The AC/DC music catalog, along with DVD's, and merchandising, are branded in Walmart stores at the AC/DC Rock Again section of Walmart. Priced to move, customers can buy an album and a tee-shirt for less than $20.

And Walmart also wants to be the market leader in downloading music. Originally, Walmart priced their downloads at $.94 to lure the iTunes customer away. ITunes sells tracks for $.99. But this week, WalMart announced they'd be selling the Top 25 hits for just $.74. On top of that, for every physical CD they sell, Walmart will give customers a free download.

The fourth quarter is traditionally filled with big releases. This week, new albums from Ryan Adams, John Legend, Snow Patrol, Toby Keith and The Cure are being released. Before Christmas, look for albums from Sarah Brightman, Dido, Seal, Missy Elliot, Taylor Swift, Beyonce, David Cook, The Fireman, featuring Paul McCartney and Youth, Kayne West, 50 cent, Britney Spears, and the list goes on. Perhaps the most anticipated album of the year, Guns N' Roses will be released on November 23.

The album, titled Chinese Democracy, has been 17 years in the making. Their last studio releases were two albums released simultaneously in 1991, Use Your Illusion, I and II. The albums debuted at #1 and #2 on the Billboard charts, a first in Billboard history. With the exception of a covers album and a single dropped here and there, Guns N' Roses haven't had a studio album out since.

In fact, the release of Chinese Democracy is so anticipated that the soda company, Dr. Pepper, announced in April they would give every person in the United States a can of Dr. Pepper if Guns N' Roses released the album in 2008. Axl is making good on the challenge and Dr. Pepper is making good on the offer, giving a free can to anyone who registers at their site.

Perhaps the most interesting part of the story is that Guns N' Roses won't be selling their album at WalMart, Musicland or Target. The only retailer with the exclusive right to sell Chinese Democracy is Best Buy.

With profit margins in such decline for record labels, the best merchandising strategy is a partnership with a Big Box retailer like Walmart or Best Buy. They can advertise, merchandise and market the acts in the manner the bands are accustomed to.

Welcome to the new record business.

This is Celia Hirschman with On the Beat for KCRW.