You’d expect an executive whose company was founded to distribute Christian music to argue that stores that abandon the category are making huge mistake, but Ed Leonard isn’t speaking just from parochial interest. The VP at New Day Christian Distributors has had what may be an unparalleled vantage point to follow the changes and challenges in the music industry in the 20- plus years he has been with the company his mom, Dottie Leonard Miller, founded in her garage when he was a teen.

His industry service is a roll call of nearly all the key organizations in the music world—membership on the boards of the Gospel Music Association, the Christian Music Trade Association, the Music CEO Group, the Church Music Publishers Association, and the Southern Gospel Music Association among them.

He’s also a former VP of CBA, who somewhere along the way additionally found the time to go back to school and become an attorney specializing in entertainment law.

The huge physical-to-digital shift in music sales notwithstanding, he remains bullish about music at retail.

“Drastically reducing the music department is a huge mistake,” he says. “Certainly music is being consumed more in a digital and mobile environment than ever it was, but physical music is not over, and just because the wave is going by doesn’t mean that you don’t ride it into shore.”

Music Gift Sales

By way of evidence, Leonard points to the fact that despite the changes in the market, music still accounts for 60 percent of what’s shipped from New Day’s Hendersonville, TN headquarters. Rather than turn their back on the category, he says, stores need to take a closer look and see what parts they should continue to invest in.

For starters, rather than lamenting the absence of younger customers, who are buying their music online, Leonard suggests concentrating on existing shoppers. Southern gospel and other gospel continue to have high physical sales, he notes, offering opportunities in older and urban demographics. These categories “are not in any way, shape, or form dead.”

But these buyers aren’t just picking up CDs for themselves. As parents and grandparents, they’re likely on the lookout for gifts. They want to be able to pass on faith-based music that is affirming and encouraging to the young people in their lives—they just may not know what to choose.

“You can still make a physical sale to someone who is not likely to give their child or grandchild an iTunes gift card,” he says.

Capitalizing on that opportunity may require rethinking the way stores merchandise, though. Rather than trumpeting the latest release by Lecrae, whom older shoppers may never have heard of, stores might do better to announce that they have the new album by one of the most popular artists among 18- to 25-year-olds. “And then ask if they have a grandson.”

‘Family-Friendly’ Emphasis

While New Day continues to believe in music at retail, it’s not ignored the implications of the digital trend. The company has worked hard to diversify over the last decade to replace lost physical sales. It has expanded its book offering from the top 25 or so national bestsellers to a couple thousand.

An even greater emphasis has been on expanding into toys and games, now accounting for around a third of business. The company has added major general market brands like Fisher-Price and Melissa and Doug and is the exclusive distributor for many of the licenses for the updated VeggieTales brand.

That focus was driven by something Leonard heard at a CBA event some years back. Consumer research expert Britt Beemer advocated Christian retail should be the segment that “owned Christmas,” and Leonard thought the idea could be extended.

“‘Family-friendly’ isn’t a bad thing, and really shouldn’t we own the concept?” he says. “No one should be better at the whole family-friendly concept because nobody is more about the family than Christians. I’m not saying non-Christians aren’t, but it’s such a core for Christians—the way that we share our faith through our families.”

Diversification can also be seen within its music makeup. The company’s Daywind label—home to Southern gospel favorites such as John Peck and New River, Brian Free and Assurance, and Adam Crabb—remains strong. But it now also serves smaller labels on the other end of the music spectrum from quartets and bluegrass, like Tooth & Nail.

Daywind also runs its own studio and publishing company, with a stable of writers that has provided songs for artists such as Mandisa. As a music offshoot, New Day is the exclusive distributor for a new range of jewelry and accessories from popular singer Natalie Grant.

Serving around 1,200 independent stores in addition to the chains, New Day knows the struggles of time and cash-strapped retailers to keep up with all the basics, without adding something else to their to-do lists. Yet Leonard advises them to look for ways to make sure they’re connecting personally with customers and providing an in-store experience.

Heightening Customer Experience

Events can provide some of those opportunities, he says, and artists in the indie music space are open to working with retailers; maybe by turning out for a meet-and-greet when they pass through town. Daywind used to send its sound booth round to stores as a customer draw until it became too costly to do so.

Leonard is now playing with the idea of a karaoke night package for stores that could be used to attract youth groups for a friendly sing-off—and which might bring the parents, too. He also notes that this summer’s music industry-wide move of new music releases from Tuesday to Friday could provide opportunities for stores to experiment with some things to capitalize on later-night weekend shopping.

These kind of things don’t have to take too much money or manpower. As much as anything it’s a change in attitude, he says.

“Nobody says you have to solve it all overnight. You just have to do one thing today that pushes you more in that direction than you were before, or maybe one thing a week.”

That could be as simple as changing the way retailers engage visitors. “What might you say to those people who walk in other than, ‘May I help you?’ Because the answer is usually they are just looking. Maybe, ‘What brings you in today?’ or ask them if they know about this one great new product you have in.”

While some people think that Millennials have written off traditional Christian retail en masse, Leonard sees a cause for some optimism. He observes that, with their love for “indie” ventures, many have a growing appreciation for local retail. But that means having what they’re looking for in stock if they stop by.

In that regard, performance tracks are still big business—New Day’s catalog includes more than 4,000—despite the growth of downloading. Though in-store burning may reduce in some way the need for a big physical inventory, it’s important to still have a sense of presence: Leonard suggests a four- foot section of new and top sellers. “They could carry 200 and look like they have a selection; anything they don’t have, the customer can go to the Burnbar.”

Leonard also advocates asking regular customers how to connect better with others at the church they attend. That’s because Christian retailers have a big advantage on other stores trying to find new customers to connect with, he points out. “We know where they are on Sundays, and many of them on Wednesday nights.”

For all of New Day’s adjustments, the company keeps Christian retail front and center. Leonard says of his mom—2013 recipient of the GMA Lifetime Achievement Award—“with every decision she makes, I have never met someone so devoted to Christian retail.”

– Andy Butcher