SWOT Analysis for Interscope Records

SWOT Analysis for Interscope Records

Interscope Records is one of the largest and most lucrative record labels the U.S. It has been extremely prosperous since its inception in 1989 and continues to dominate the music industry as it has acquired dozens of top artists, many of whom hold multiple gold and even platinum records, including artists such as Madonna, Imagine Dragons, and Kendrick Lamar. Though very successful, Interscope Records has many weakness and threats as the music industry is a massive market.

Here is a bulleted SWOT analysis highlighting these as well as its strengths and opportunities:

Strengths:

  • One of the largest record labels in the country, giving them an advantage over competitors in amount of resources and broader customer/consumer base.
  • 16.15 billion dollar music industry in the U.S, leaving Interscope much wealth available to be acquired.
  • Is the parent label to many record companies, often heading smaller labels album distributions, further broadening resources for their artists and increasing revenue.
  • Made up by dozens of record-breaking artists, proving to be very lucrative for the record label.
  • Has connections to other parent labels via joint ventures, which could be appealing to artists looking to sign to Interscope.
  • Differing from other labels in giving more decision-making power to those seeking talent for the label, maximizing talent acquirement, as these people are specialists in their department. This could be attractive to potential employees seeking to fill such positions.
  • Comprised of top music industry executives which is attractive to young up-and-coming talent.
  • Marketed toward a young audience, of whom make up the top consumers in the main-stream music industry

Weaknesses:

  • More competition among A&R’s considering label size and decrease of workload, as artists are becoming more developed upon their first interaction with a label. This poses a problem as Interscope might have difficulty acquiring employees in the future.
  • Having to go through numerous people to get minute tasks accomplished due to size, which could delay various processes that need to take place promptly, potentially decreasing efficiency in some areas.
  • Album delay criticism from other artists, giving the label a bad reputation and decreasing customer attractiveness.
  • Less creative control for artists possibly reducing number of artists, as many value complete creative control over their music.
  • General major label reputation for being, “strictly business” without having artists’ best interest.

Opportunities:

  • Capitalization on the Latin and Country genre as there is much wealth to be acquired there.
  • The internet’s maximization of the number of artists, which gives Interscope more opportunities to acquire more artists.
  • Vast amount of resources at disposal, which could increase revenue.
  • Ongoing increase in the revenue of the music industry, which gives Interscope more opportunities capitalize
  • Increase in streaming among music consumers, again another opportunity to capitalize on the increasing market.

Threats:

  • Decrease in album purchases over the years, which could lead to a potential loss of revenue.
  • Artist independency becoming more popular making the need for record labels more obsolete
  • Other top record labels posing a threat as they take from Interscopes consumer base.
  • Other top distribution service, again providing another option to the customers of Interscope
  • Former artists slandering the company making Interscope less attractive to artists and consumers alike.

Interscope Records, despite its weaknesses and threats, still remains at the top of the music industry as one of the most prominent and sought after record labels. They face more pros than cons and will continue to thrive and dominate their market for years to come.Sources:

https://www.statista.com/topics/1639/music/

http://defjamct.tripod.com/id2.html

https://www.interscope.com/

https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=829601

https://www.theguardian.com/music/musicblog/2011/jan/27/behind-music-industry-a-r

 

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