Companies Sweeten the Deal on CDs

In a business struggling to make money, record companies are offering discounts, rebates and special gifts with CDs to attract buyers and earn new fans.

Why? Apparently, being at No. 2 just won't do debuting at No. 1 on the charts is more important than ever.

"People pay attention to early album sale totals now as much as Hollywood box-office totals," said Geoff Boucher, pop culture writer for the Los Angeles Times.

According to Boucher, debuting high on the charts today can make or break an album.

"It creates media coverage and fan interest that will propel it forward in the following weeks," he said. "It subconsciously tells you 'this must be something big and important.'"

Hip-hop's new princess, Ashanti, scored big with her self-titled debut album, which sold at a discounted price thanks to the strategy of Murder Inc./Island Def Jam Records. The company offered retailers a $2 rebate for each album sold in the first two weeks.

"You see a new album you've heard something about ... If it's $16 maybe you keep walking, but if it's $11 you say, 'I'll take a chance,'" Boucher said. "You discount her release to get her into the hands of people."

Ashanti sold 502,000 copies in its first week, and became the year's second-highest first-week total, behind only the established songstress Celine Dion. 

But such tactics are not limited to new artists. Eminem, a headline-grabbing rapper, included an incentive with the first two million copies of The Eminem Show a bonus DVD that featured performance footage, behind-the-scenes shots and interviews.

The album debuted on top and remained king of the mountain for five weeks. So why include a treat when it would have sold big anyway?

"It's a thank you to the fans that have been loyal," said Dennis Dennehy, Eminem's publicist. "And obviously it helps combat piracy issues."

The CD's tracks were being downloaded off the Internet long before the music was on sale, and pirated copies were sold on the streets at such a rate that the album release was bumped up twice.

Dennehy said the piracy disrupted the marketing plan, and the DVD was a way to encourage fans to buy a hard copy of the CD.

All this wheeling and dealing has Suge Knight, founder and CEO of Death Row Records, feeling sentimental for the good old days.

"I think it's more about just the money now. It used to be a time when it was about the art," he told Fox News. "Now it's a situation where the managers are saying, 'OK, turn a record in. We're going to make some record sales, and if we have to buy some records ourselves to make you sell records it's OK.' Or, 'We'll discount it $5 or $6 and you'll look good on sales. You just don't make real money.' I think that's really changed towards the business side of it."

Although the top spot on the charts is cherished, Geoff Mayfield, director of charts for Billboard explained it isn't as rare as it used to be. Changes in Nielsen and SoundScan technology has made the system much more accurate.  

"There were only six albums that debuted at No. 1 in first the 50 years of charts (1955-1991)," Mayfield said. "Since May of 1991 there have been well over 100."

Although it's more common, the glimmer of the top spot hasn't faded. "It's still a big kick to be No. 1 and to debut at one," he said. "It's bragging rights for the artist and record company."

But discounts and rebates that help artists debut high aren't cheating the chart's integrity, Mayfield said. "Ashanti sold half a million units the first week. You don't get that kind of number just because you put something on sale."

In today's music world, it comes down to keeping the fans interested in buying actual CDs, experts said.

Record companies, Boucher said, are "trying to do things that make CDs enticing and viable at a time when music is as easy to steal as extra copies of the newspaper."