lets say it costs $2.50 (which is probably a high figure) to produce the triple lotusflow3r cd package....

what kind of profit does Prince pocket?

if he records it at home, his own engineers (*if he uses one), his own musicians...has to pay for the graphics, but delivers x amound of cds to Target, who buy ALL of what he ships (*they don't necessarily sell them, but the deal is they buy them all in exchange for exclusivity)...

what kind of profit is Prince pocketing?

I say 80/20 split of my $11.98 xs-----. You do the math.

As high as it wants 2 go!

mzsadii said:

As far as I know, Target only does a limited supply of cds for an exclusive deal. That's what they've done in the past with the Target Exclusive cds. So, if they printed 300,000 or 400,000 cds to distribute to all of the stores, that's a nice dollar amount for all parties involved.

Once we got the final figures of sales, I was thinking about this today...

He sold 168,000 units...his profit is lot's more healthy than most artists'.
Let's say he pockets $8 out of the $12 price...that's $1.3 million in profit.

Now, I'm saying his hardcore fans (those who will buy anything he does) number at 100,000...Let's say about half of those, because of the economy, buy into his website, at $77. That's $3.8 million in sales...I'm sure he keeps quite a bit of that as well.

That's not a bad payday for essentially cutting an album and getting a few people to sell it for you.

Now, if he wants to tour with this....it could get HUGE.
[Edited 4/9/09 14:28pm]

I wouldn't be surprised if he just received a one-off payment from Target for the discs - similar to what he got from the Mail On Sunday in 2007 for Planet Earth. Something like $2 million for 300,000 discs (?? - total speculation on my part). It's then up to Target how much they're going to charge for it / how they're going to promote it etc. Prince doesn't care because he's already made his money (well, I'm sure he does care, but it's not like he's sweating to sell 'x' amount to make a profit like in his old WB contract).

I doubt Target actually expects to make much profit from the sales of the CDs, hence the cheap price. What it does do is get people in the stores and chances are they will buy something else while they're there - that's how they make their money off this. It gets people in the stores, they appear 'hip' to the music buying public, and they get a good excuse to advertise nationally. The markup on CDs/DVDs in these stores is very low (at least it was 10 years ago when I used to work at K-Mart).

From Prince's point of view, I don't think he sees the 3CD set as his main dollar maker. He's using it as an advertisement for the website and (hopefully) a tour. As Revolution pointed out, he's going to make a sugar-load from the website, given that his only real costs are a handful of web-designers to maintain the place. He's already got 30 years of content just sitting in his backyard waiting to be released, so it's not like he has to record anything new if he doesn't want to.

toejam said:

also we would need to figure in the costs to prince of producing the music videos and whatever other promotion he puts on, like appearing on the television shows (travel and personnel costs) since he is handling all of this himself. these are things that are usually paid for by the label (or, more accurately, deducted from the "profits" used to calculate what the artists are paid by the label).

Finally, I get to put my 300-level microeconomic class to use.

A lower than average price can lead to greater revenue. An item will have a quantity demanded at a particular price.Due to the slow economy and the fact that Prince is not as popular as he used to be, he may not have sold as many copies at a higher price. Lets say he put a price tag of $25 on the set. People might weigh the options and say it is not worth the money for it and he might only sell 75,000 copies. That would give him $1,875,000 in total revenue. However, at $11, people may be much more inclined to but the set. People who haven't bought music in a while (due to shortage of funds) may love the price. Marginal Prince fans may say, "for the price, why the f@#$ not." So he ends up selling 185,000 copies. If that happens, he gets $2,035,000 in total revenue.

Obviously, there is much more to consider, but the org does not allow me to use the charts and graphs that are needed to truly show how this could be in his best interest.

Of course, I think he is expecting to make most of his money on the website and (I really hope) his US wide tour.

Darwintheorgangrinder said:

Of the $11.98 - Prince received about 6.49 per CD sold. Thus minus *costs* which equaled to about $5.49. (185,000 copies) sold @ $6.49 = 1,200,000.00 taken into consideration tax laws @ minimum of 23.5% tax - $28,200.00 taxes. Prince profited about 1.175 million in sales. I am sure Bria gets a payout of 33% since her album is one third of the new release? About $350,000.00, So overall Prince pockets - about $750,000.00 for Lotus Flower? IMO, I believe its a bust but it depends on internet club revenue for those who got 'con'ed once again at $77.00. X ????? 10,000 members? -$770,000 + 750,000 = $1.5 million not a bad days work.

GMAN

Revolution said:

It cost him something to record all three albums, so you've got to figure that cost in there. I have no idea - maybe someone here that's in the business could add their input - but does $500,000 sound anywhere close to right?

Like you said, the big money is in touring.

Oh lawrd.....

GMAN2000 said:

I really, really doubt Bria gets 33%. She is essentially just the lead voice on an album that was produced, arranged, composed and performed by Prince.

jtfolden said:

Exactly, I think she will get a 1/3 of 1/3 of the CD which is 10% of the profits, a small percentage of the sales of her CD. I think Prince was smart to use her to get to the young latin girls market.

GMAN2000 said:

I doubt it is that high, this is target and their prices don't afford that high of a markup, I would think it is less than $5

jtfolden said:

Exactly.

moussemaker said:

Don't the credits say she "wrote" some of the songs...but nothing is specified.

daPrettyman said:

Prince has a long history of inventing fake credits.

daPrettyman said:

at 33% and at all accounts why not? If your Bria and your in discussion with Prince on a CD set 3 albums, common sense says your on 1 album and he has the other two...its 33% of the sales. But then again in Prince's world maybe he paid her in different ways?..LOL! Bottomline, IMO I believe this is a financial setback for Prince..in terms of 'sales'. The website got off on the wrong foot again and by having 1 retailer carry his CD.. that in itself was a disaster decision IMO....

Prince should have released the CD's only online, sold them per track for .99 cents each... Lotus Flower 13 tracks - $13.00 - MPLS Sound 9 Tracks $9.00 -

Total: $22.00 we all would have paid that.
Plus release it on itunes that was as well.
Sell at Target for 19.99 with all 3 CD's as a set.
Probably would have sold 3/4 of 185,000....at that price.

GMAN

Pay $.99 per mp3!?
I guess not.
When I get an album I want PCM, the full PCM and nothing but the PCM.
No lossy compression, PLEASE!

Yes, I am oldskool, but mp3 doesn't do it.
I also want a usable medium which still equals to a CD.
What will you do with your ipod? Put it on the shelf?
I will do that with my discs.

i don't care so much about physical media (i can burn my own discs) but i do definitely prefer lossless audio files.