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How Much Money Do Christmas Albums Make?

How much money can one smash-hit holiday song rake in?

It’s nearing Christmas season, which means you should prepare to be mercilessly assaulted by Mariah Carey’s “All I Want for Christmas Is You” whenever you step out in public, turn on any media or simply order Alexa to play some goddamn Christmas music.

That one’s a sure thing, as are pantheon-level Christmas standards like “White Christmas” by Bing Crosby or, heck, the odd-couple alchemy of Crosby and David Bowie’s classic “Peace on Earth/Little Drummer Boy.” Also, anything by Frank Sinatra, and certainly Bobby Helms’ “Jingle Bell Rock.” Same with Christmas albums by crooners like Michael Bublé and all the pop-star usual suspects you expect Christmas albums from. There’s also genre-specific gems from the likes of Run DMC and Blink-182. But then, what’s the deal with an album of standards by, say, Scott Weiland? (It’s not at all what you’d expect, for better or for worse.) Christmas is indeed full of surprises!

So how much money do artists make from Christmas songs? Just how lucrative are they? Why does every artist make Christmas songs these days? Are you set for life if you write a hit Christmas song? Alongside Jay Gilbert, co-host of the Your Morning Coffee podcast and newsletter about the music business, co-founder of Label Logic and a veteran of Universal Music, Starbucks Entertainment, Fox Home Entertainment and Warner Music Group (and who even worked at Tower Records when he was younger!), we’re wrapping up some answers.

Is there really a strong market for Christmas music every year?

You bet your ass there is. And it was ever thus, according to Gilbert. At Tower Records back in the 1980s, during the holiday season he recalls selling a ton of copies of “Little Drummer Boy” by Crosby and Bowie, and “Grandma Got Run Over By a Reindeer” by the rather lesser known duo Elmo and Patsy.

This trend of pop and rock artists singing Christmas songs goes back further though: Gilbert says the Beatles used to make a Christmas record every year for their fan club, with songs and skits. Elvis released a pretty popular Christmas album (the cleverly titled Elvis’ Christmas Album) during his era, too. And of course before all of that there was Crosby, who’s pretty much the undisputed GOAT of Christmas music — at least until Mariah Carey came along. 

So do all musicians make Christmas songs these days?

If they don’t, they should. Gilbert’s clients certainly do. “We encourage all our artists, while they’re in the studio recording their new record — even if it’s in the summer — to record a Christmas song,” Gilbert says.

What? Why? How much money do artists make from Christmas songs, really?

Christmas music is a really big deal — even more so these days, as people get their music from smart speakers. Gilbert says that on digital service providers like Apple Music, Pandora, Spotify and Deezer, as much as 35 percent of the music they play around the holiday season is Christmas music. That’s a lot of demand, and means there’s a decent chance an artist’s song can get a lot of plays.

Artists are doing this, obviously, for the sales, streams and downloads. But also for the less visible forms of artistic remuneration: what’s known as sync (as in synchronization) licensing. That’s what allows an artist’s song to get into TV, movies, games and things like that. There are so many ways to make money off a song nowadays, and Gilbert says there’s a huge demand for sync-licensed, original holiday music.

What’s the difference for an artist between covers of Christmas standards versus original songs?

Potentially, a lot of zeros on the checks they get in the mail every year after Christmas! It boils down to the underlying finances of any song. It can get extremely complex, but here’s the simple version. There are a few types of revenue streams when it comes to songs. The song itself: Say you write a song, that’s the composition. If an artist wants to record it, you can make money off it in the form of publishing royalties for a very long time. Generally, this lasts for 70 years after you die, after which time the song’s copyright enters the public domain (meaning it’s free to use at that point).

The other side of this coin is the recording of the song. If you recorded but didn’t write the song, you’re not entitled to the publishing royalties every time the song earns money. But you will get what’s called mechanical royalties, meaning if it’s put on a CD or an album, every time that sells or is streamed, you’re entitled to money. Or at least your record label is.

Then there’s what’s called performance royalties. Every time a song is played in a store, at the mall, or in a bar, restaurant, radio, you name it, the artist’s record label and the song’s publisher earn performance royalties. These are collected by what are called PROs, or performance rights organizations, like BMI or ASCAP. Even though each play (just as with Spotify) doesn’t amount to much, it can really add up. This is what’s known in the industry as mail money — as in, royalty checks just keep arriving in the mail, year after year after year, for a song that’s got legs.

So every time Mariah Carey’s Christmas song gets played in Nordstrom or on Spotify or whatever, she gets paid?

Every. Single. Time. Think about that! Well, actually it’s Carey as well as a guy named Walter Afanasieff. What, you’ve never heard of him? He co-wrote many of Carey’s songs during the first part of her career, as well as an obscure little number by Celine Dion called “My Heart Will Go On,” and has worked with a dozen or more other platinum-selling, household names. You probably won’t ever find him begging for change.

Can one big Christmas song set you up for life like that?

In general, if you write a hit song and then manage your money well, yes — Gilbert says you can live a comfortable life. Successful professional songwriters make a nice living indeed! Gilbert works with a man named Brett James, who’s written 35 number-one songs, mostly for country artists. For his trouble, he can afford to literally own his own airplane.

All that said, it’s hard to think of too many other Christmas songs that are as popular and inevitable every winter as Carey’s and Afanasieff’s. But if a song gets played, streamed, performed or purchased, it’ll make money.

Which Christmas standards are still copyrighted and which are public domain?

According to this list, it’s a really mixed bag. “Deck the Halls,” “Jingle Bells,” “Silent Night” and “O Little Town of Bethlehem” are all in the public domain. They mostly date back to the 19th century. But “Frosty the Snowman,” “Santa Claus Is Coming to Town,” “Have Yourself a Merry Little Christmas,” “Little Drummer Boy” and “White Christmas” aren’t yet. The estates of the songwriters are still collecting checks from these songs! Actually, it’s the publishing companies who are collecting the royalties for these songs — meanwhile, they also help push the songs for usage.

Do artists make Christmas songs and albums as an easy way to fulfill record-company obligations?

Yes, although Gilbert says there are often stipulations in a contract that exclude that. It’s even possible for an artist not to see a dime from a hit song because they still owe their record company money from their advance, with that revenue going toward what’s known as recoupment by the record label. 

But in any case, making a Christmas album for an artist is a no-brainer?

Yes. In fact, Mariah Carey blazed this trail somewhat. Before her song, in 1994, a Christmas album had come to be seen as a late-career play for an artist. That’s why, at 24 and her career just taking off, she was hesitant at first. However, she got behind the idea, and she and Afanasieff apparently wrote the song in 15 minutes (the arranging and actual recording took much longer), and knocked the whole album out in the middle of summer. Carey was even putting up Christmas decorations around the house to channel some authentic vibes.

In any event, the whole thing paid off handsomely. And while artists may not expect to reach the ubiquity of “All I Want for Christmas Is You,” what’s the harm in writing an original Christmas composition? It’s a handy way for an artist to stay relevant and in front of their fans outside of album-release cycles.  

Can a Christmas song even break an emerging artist?

Look no further than 1979’s “Grandma Got Run Over By a Reindeer” by Elmo and Patsy. Elmo was a veterinarian! (Though the duo had performed as a bluegrass outfit in the 1970s.) By the early 1980s, it was more popular than Crosby’s “White Christmas.” Elmo and Patsy didn’t write the song, but they’re still getting checks in the mail for it after every Christmas, even if it’s revenue from the song becoming a ringtone or because the song is emanating from the inside of a plush toy. Elmo is a millionaire several times over. There’s no shame in being a novelty act or a one-hit wonder when it’s a ubiquitous enough song! 

Which is all to say that for an artist or a songwriter, crafting a hit holiday song can truly be the gift that keeps on giving.

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