2022 IMS Business Report: A summary of key trends, takeaways
Despite pandemic-related challenges, the dance/electronic music market “grew strongly” in 2021, with an approximated 412 million “fans” across the globe consuming music from 130,000 “core artists”* and 11 million “casual artists.”** The International Music Summit (IMS) estimates that in 2021, electronic music was valued at a total of $6 billion dollars. This represents a $2.4 billion (71%) increase since 2020, but a $1.5 billion decrease (-20%) compared to 2019. The 2022 IMS Business Report profiles areas of growth and decline, as well as emergent, continued, and defunct trends in the dance/electronic music market, through the lenses of music, festivals and clubs, fan engagement, education, impact, diversity, and valuation. Dancing Astronaut summarizes the key points of the 2022 report below. The report is free to download on IMS’ website.
*This estimate is derived from Viberate and Chartmetric data (100+ Spotify followers and 100+ monthly listeners.
**Defined as “electronic music artists on SoundCloud.”
IMS data demonstrates “strong” growth in the dance/electronic music market in 2021 owed to total market growth and market share growth in the United Kingdom (UK) and Germany. The report distinguishes between commercial dance music and electronic music; the former is familiar-sounding to electronic dance music audiences, but “novel to the general population,” whereas the latter is “predominantly consumed in long-form format and played by DJs in clubs.” Of these two separate yet interdependent parts of the market, electronic music is most closely married to club culture. Creative trends in electronic club culture infiltrate commercial dance music, directly influencing this part of the market, while commercial dance music serves as a funnel of sorts, acting as a gateway to electronic music and its club culture.
Overall, commercial dance music’s recorded music market grew by 18% between 2020 and 2021. Although market share was flat in the United States (but stable) and in Canada, it rose in the UK and Germany. This activity was observed amid a decline in hip-hop consumption; hip-hop shares decreased in the UK and the US.
Genres Vie for Pole Position
Meanwhile, on the electronic music end, genre popularity shifted in some interesting ways that will invariably guide trends into 2023. Specifically, tech-house overtook techno as the best-selling genre of electronic music on Beatport. Tech-house had ranked as the second best-selling genre on the platform in 2019 and 2020. The genre’s assumption of the top-selling slot on Beatport is a sales-backed reflection of what the industry has seen over the past year or so: tech-house’s relative explosion in popularity and resulting ubiquity, thanks to newfound rapport with mainstream audiences. It’s worth noting that Dancing Astronaut‘s 2021 Breakout Artist of the Year, John Summit, has been a key driver of tech-house’s widening appeal.
As tech-house and techno vied for the top two places in the top-selling genre discussion, house remained consistent, retaining its title as the third most popular genre in 2021. In recent years, melodic house/techno and drum ‘n’ bass have reliably competed for fourth place, but in 2021, the spot ultimately belonged to melodic house/techno. The recently created dance/electro-pop genre, in which Sofi Tukker often operate, rose within the Top 10, coming in as the seventh top-selling genre. It’s likely that the dance/electro-pop genre will continue to move up the ranks amid continued artist engagement and listener consumption.
The Recorded Music Market Grows
In 2021, the total recorded music market (all genres) was up 18%. As to be expected, streaming continued its upward momentum; growth accelerated in 2021, rising 24% year-over-year (streaming growth in past years: 19%, 2019-2020; 22%, 2018-2019). Existing and new platforms (think TikTok, Apple Fitness, and Peloton) alike contributed to this jump.
Notably, for the first time in 20 years, physical sales returned to growth in 2021. Vinyl sales and CD sales spiked by 51% and 9%, respectively. Performance rights also returned to growth (+4%) after continuous declines observed since 2018.
And although the overall downloads market declined by 15.3%, Beatport—a barometer of tastes and trends in the dance/electronic music market—achieved 13.0% growth.
Altogether, electronic music sales and streaming saw an uptick of 32% between 2020 and 2021, for a total valuation of $1.3 billion. The first chart derives from IMS’ analysis of data from Nielsen Music, British Phonographic Industry (BPI), and Bundesverband Musikindustrie (BVMI). The second chart portrays the faster-than-market growth of electronic music in three of four countries (US, UK, and Germany). Electronic music valuation made gains in the US, UK, Germany, and Canada; however, only Germany was found to increase market share over five years.
in 2021, electronic music was valued at a total of $6 billion dollars. This represents a $2.4 billion (71%) increase since 2020, but a $1.5 billion decrease (-20%) compared to 2019. The breakdown of dollars across education, software and hardware, music sales and streaming, DJ and artist earnings, and clubs and festivals is as follows:
Festivals and Clubs
In 2022, electronic festival and club valuation will likely return to pre-pandemic levels as the industry increasingly returns to form. In 2021, electronic festivals and clubs were valued at $2.5 billion, up $1.6 billion (+166%) from 2020 (and down $1.9 billion [-42%] compared to 2019 figures).
DJ Software and Hardware
Valuation of DJ software and hardware hit a record high in 2021, rocketing to $1.2 billion (+14%).
- 2019: $0.9 billion
- 2020: $1.1 billion
- 2021: $1.2 billion
This continued increase dovetailed with the “at-home DJ boom” of 2020, when an unprecedented number of people took up DJing/producing during COVID-19 quarantines. That said, DJ software and hardware valuation had the potential to be even stronger and would have been, if not for the chip shortage and global shipping challenges, according to anonymous company in the DJ software/hardware industry cited in the report.
DJ and Artist Earnings
The 2022 IMS Business Report betrayed a reality already known: streaming doesn’t pay. In fact, just 1,650 electronic artists earn $65,000 a year from their music. Although this number has grown since 2017, the true number of artists who take home this amount is likely to be “substantially lower,” given that many artist catalogues split royalties amongst collaborators. As a result, the truth that very few artists can rely on their music revenue to support themselves remains, well, true.
Ultimately, livestreaming didn’t supplant live, in-person music experiences—but it continued to have an impact. In short, there will always be a market for streaming, and it will appeal mostly to those who can’t (or who choose not to) attend a physical show.
In 2021, Twitch logged thousands of music streams and millions of hours watched. Growth was slow but steady, underscoring that although the rapid progression in streams seen during the pandemic has since stalled, interest remains. Meanwhile, Defected Records and Beatport saw unanticipated upticks in subscriber counts, amassing 153,000 and 144,000 more streamers than expected, respectively.
Beatport, however, did not experience similar growth in 2021 as the dance/electronic music market returned to the live setting:
- Total streamed events: 189
- Unique artists streamed: 574
- Total hours streamed: 949
- Longest single stream length: 24 hours
- Total views: 66.4 million
DIGITAL FAN ENGAGEMENT
Electronic artists marketed digital merchandise non-fungible tokens (NFTs) to their fans at increasing rate, leading development in this emergent space. In fact, most (64%) of all identified music NFTs in 2021 were issued by electronic artists. 3LAU led this wave (at $17.8 million), followed by grimes ($6.3 million) and Steve Aoki ($4.8 million).
Electronic artist NFTs were also some of the most lucrative, as demonstrated by the bar graph below. The identified music NFTs issued by electronic artists in 2021 were worth a total of $55.4 million.
The Metaverse and Gaming
The Metaverse, a collection of digital spaces in which users can interact with other users in a computer-generated environment, was another area of invention for electronic acts. The 2022 report details electronic artist activity in the Metaverse on pages 75 to 78.
Gaming and dance/electronic music’s increased interplay led Dancing Astronaut to establish its “Astro Arcade” editorial content series in 2020. In 2021, gaming and dance/electronic culture continued to intersect, with artists not only soundtracking games, but also appearing as playable characters within them. Labels invested accordingly; Sony has put $250 million into Fortnite, while Warner, for instance, has eight figures in Roblox. And with gaming revenue estimated to hit $400 billion in 2025, dance/electronic market players can be expected to continue investing and innovating in the gaming arena.
Digital Communities Flourish
The NFT marketplace and the Metaverse accounted for just two of the digital communities that cultivated a dance/electronic following in 2021. TikTok grew not only in monetization and revenue (page 81), but also in the amount of time that users spent engaging with content on the platform (see graph below).
Dance/electronic artists such as John Summit and Loud Luxury have developed followings on TikTok that can be considered small communities, given participants’ interactions not only with the posting act, but also with fellow fans in the comments section. However, as the report underscores, compared to other genres like pop, which was associated with the most cross-platform actions (i.e., shares, likes, etc.) by genre in 2021 (with just over 20 billion actions), electronic music is the sixth of seven genres by actions across YouTube, Twitter, Instagram, and Facebook. In other words, it’s the second lowest-performing genre in the context of actions.
Broadly, although electronic music might not have the foothold that pop, hip-hop, or Latin does in the context of popular social channels, electronic music Discord communities are thriving. IMS identified a total of 215 electronic Discord servers and a total of 318,943 electronic server members.
The 2022 report also profiled perspectives on strides taken to increase racial and ethnic representation and diversity in the dance/electronic market. “Most people” in the industry with whom IMS spoke felt that “expectations around diversity changed permanently.” However, follow-through lagged. Research from Technomaterialism, a platform formed by Black writers, musicians, and club workers, surveyed Black representation on 45,000 electronic music lineups across 31 territories (the 27 countries in the European Union plus Australia, England, Scotland, and the US). Black representation was found to be “way below expectations” in the US, but growing. The data on France was worrisome; there, representation was “way below expectations” and declining.
Cumulatively, the data denote that advancements have been made in terms of awareness about inequities in the dance/electronic market, but work to effect change remains necessary and must continue.
Featured image: Getty Images