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opinion News January 9, 2023

Remembering Sanity: The Retailer That Tested the U.K. and Subscriptions

Senior Journalist, B2B
Remembering Sanity: The Retailer That Tested the U.K. and Subscriptions

The early days of the New Year always promise a fresh start. Out with the old.

Sanity, the once-great music and entertainment retailer, is part of the 2023 clear-out.

In a statement posted Wednesday (Jan. 4), Sanity confirmed that its days are numbered.

By the end of April, the brand’s remaining 50 stores will close for good, in line with the lease expiry of each outlet.

CDs and DVDs, for so long Sanity’s core inventory, are old hat for consumers who can now access 80 million tunes from a small, glowing device in their pocket.

“With our customer shifting to digital for their visual and music content consumption, and with diminishing physical content available to sell to our customer, it has made it impossible to continue with our physical stores,” explains Sanity CEO and owner Ray Itaoui.

Despite the “challenging and ever evolving entertainment landscape,” the Sanity business has “prospered and remained successful for many years, quite an achievement in the fast-changing retail space,” Itaoui adds.

Sanity’s online presence will live on, its walk-in spaces will not.

The development will trigger little more than a shrug for most music fans, but it’s worth remembering Sanity’s ambitions, its innovations, and its place in a world that no longer exists.

RIAA mid-year report says CDs are dying three times as fast as vinyl is growing

Long before streaming, and prior to JB Hi-Fi’s ascension, and subsequent expansion into gadgetry and hardware, Sanity was Australia’s market leader, a business that made the leap into the U.K. and operated an early digital music platform.

Founded by retail mastermind Brett Blundy, Sanity began life in 1980 with just a single store, Jetts, in Pakenham, Victoria.

When a consortium led by Itaoui acquired the business from Brett Blundy Retail Capital (BBRC) in 2009, the Sanity chain had ballooned to 238 stores, including Sanity and the local versions of U.K. brands Virgin and HMV.

With Blundy at the wheel, his Brazin company entered the U.K. in the early 2000s with the purchase of 77 Our Price stores — businesses that screamed “cheap and cheerful” — from Virgin Group.

Sanity would pop up on High Streets and concourses around the U.K., a top-5 recorded music market which was beginning to shed value, a trend that would become a spiral before downloads, and later, streaming platforms strode in.

The U.K. experiment ended in 2003 when Brazin sold its 118 Sanity Entertainment U.K. stores to an investment firm for an estimated £12 million ($21 million).

Sanity wasn’t done with flipping the script.

In the late 2000s, when Sanity claimed a 25% share of Australia’s physical music retail market, the business pressed the button on LoadIt, described at the time as the first online music subscription service.

CDs for display in a store

At the time of launch, Itaoui described the platform as “groundbreaking” and “a natural extension of our music stores and makes online music even more accessible for the masses – it’s a rich, vibrant and easy-to-use experience that reflects the excitement of our stores.”

The full commercial service enabled subscribers to download up to 300 tracks a month for $18.60, from a catalogue of 1 million licensed tracks.

It was a short-lived venture (it’s worth noting JB would also launch a digital music platform, Now, which didn’t stick).

Who knows what LoadIt could have evolved into had it stayed in the game and pivoted to streams.

So, who is hurt by the demise of Sanity? Staff, yes. And it’s a blow to regional music consumers, and followers of country and classical music, two genres which maintain hardcore, hard-copy fans.

Will CDs go the way of the horse-drawn cart? It’s a question worth answering with another question — who foresaw the revival of cassette tapes, a format that lacks the versatility and sound quality of those plastic discs, which literally unravels and turns to sludge if left the car on a hot day. Don’t bet the house on CDs to disappear from sight.

“There is so much to be proud of,” continues Itaoui. The Sanity brand “became synonymous with the go-to place to get anything that mattered in the world of music: from vinyl, to CDs and DVDs, hardware, accessories, and of course face to face advice on everything musical.”

Sanity, once the top dog in Australia, tried its hand at international expansion and downloads.

Time and technology marches on.

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