Kings of A&R

When times are rough you throw out many darts as possible hoping one sticks. One dart being thrown by labels is re-investing into old stars..

They believe there’s new money in new music from old stars.

Sony BMG’s Burgundy Records is now home to R&B Chaka Khan, ’80s pop diva Gloria Estefan (pictured), Donna Summer. New Door Records, part of Universal Music Group, released new albums by Frampton, ’70s arena rock favorites Styx and Motown legend Smokey Robinson last year.

This strategy is not new, Malaco Music Group and Koch Records, have long made a business out of releasing new material from aging stars.

Also, older fans of ageing artists typically buy CD’s. Sales are typically sluggish for older stars because its not the ‘NEXT’ new thing, but its still an opportunity to generate at least modest profits from older artists at a time when it’s becoming increasingly difficult to make money on new releases of any kind. Its the ‘we will take what we can get” mentality.

Depending on how their deals are structured, even modest sales levels can be enough for an album to make money. Older artists generally command smaller advances, Kellogg says, adding that thanks to their existing fan bases, labels don’t have to invest as much on marketing.

Still, marketing new recordings by older artists isn’t a sure bet. Gallo says that New Door’s success rate on turning profits on such releases has been about “50-50.” Just look at SANCTUARY for example. (Forbes)