Right, and that's why systems like bandcamp are different. The artist doesn't need a label to start with, and BC takes just 15%, and the artist controls pricing

Right, and that's why systems like bandcamp are different. The artist doesn't need a label to start with, and BC takes just 15%, and the artist controls pricing strategy. But you're right that label robbery of artists played a big role in the significance of merchandise. It just wasn't true to the same extent in (say) the 70s, because revenue from actual music sales was larger. That was particularly true for musicians who had significant merch sales - they also had really significant music sales revenue. As I noted elsewhere here, the one upside of label thievery was their ability to cross-subsidize artists. Even tiny (in terms of general sales) labels like ECM got a huge hit every once in a while (e.g. Jarrett's Koeln Concert) that enabled them to keep working with artists whose albums barely broke even. That model has essentially ended now.