Harvard Business School Studies Beyoncé's Biz Savvy

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MBA stands for master's in business administration. But at the Harvard Business School, the "B" may now stand for pop singer Beyoncé Knowles. A new case study from a professor at the prestigious institution takes an in-depth look at Queen Bey's decision to engineer a stealth online release last year of her fifth solo album, according to the Harvard Gazette.

Beyoncé's management company, Parkwood Entertainment, secretly worked with her label, Columbia Records, as well as Apple, Facebook, and Instagram to drop the release with no advance notice. Harvard Business School Professor Anita Elberse, working with Stacie Smith, who received her Harvard M.B.A. this year, looked at the project and the lessons it can teach MBA students.

Rather than working through the usual chains of distribution, including online and CDs, Beyoncé instead released the album at midnight on December 13, 2013, according Bloomberg Businessweek. Fans could not buy single tracks. Instead, they had to pay $15.99 for the full album, like in the old days when record and CD albums were the only form of distribution and buying a single song was out of the question.

The shift to releasing digital tracks separately has meant a loss of revenue for the music industry because people who only wanted a song or two weren't forced to buy a complete bundle. The strategy that Beyoncé used likely meant far more money for both her and Columbia, as the album was a big hit. It sold 828,773 copies in three days and was another number one hit.

"She's clearly among the most powerful people in the music industry at the moment ... so to understand the operation behind such a powerful figure is always very interesting," Elberse said to the Gazette.

Elberse does question whether the move was necessarily smart in the long run. The decisions of Beyoncé and her business associates might have damaged relationships with long-time partners who were cut out of the distribution and any chance to make a profit. Target and Amazon.com refused to sell the physical album, according to Bloomberg. Fans who are accustomed to purchasing only the tracks they want might be cooler toward the singer in the future. Then again, it may be that Beyoncé has correctly calculated that, like her top single, she is Irreplaceable.
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