Music Market Peculiarities - Essay Example

If Music is the Food of Love, Log on Due to the continually growing strength the digital music market is beginning to develop upon the Australian and global music markets and the repercussions it may have on the traditional music delivery sales such as CD's and DVD's is a world-wide concern affecting the music industry at a whole. Through endless court battles against pirate music download sites and initiators of international music piracy such as the victory against Napster in 2000 and against Kazaa (http://www.kazaa.com) ending in 2005, originally a Swedish company and bought over in 2002 by an Australian company entitled Sharman Networks (http://www.sharmannetworks.com). Increases the thought as to whether or not the availability of illegal digital music online has an affect on the traditional music delivery sales. Thus driving the music industries marketing developers into over coming such possible downfalls in the traditional music delivery sale statistics and push for a contemporary style of integrating tradition and modernism into an approach that will appeal to the higher and lower income groups, therefore hopefully decreasing the consumers need to illegally acquire their favorite tunes online and buy at a nominal subscription fee. The Australian music industry has been performing experiments within the online music industry, by various companies fighting to stay alive and keep up with the technological storm. Various online stores such as HMV (http://www.hmv.com.au) and Sanity (http://www.sanity.com.au), JB Hi-Fi (http://www.jbhifi.com.au), Chaos Music (http://www.chaosmusic.com), Whammo (http://www.whammo.com.au) and the Dick Smith Electronics (http://www.dse.com.au) have and are been supplied with downloadable music by a hosting company called Destra (http://www.destra.com). In April 2004, ninemsn had launched their music download service (http://ninemsn.com.au/music) and other telecommunications If Music is the Food of Love, Log on 2 companies such as Telstra (http://www.telstra.com) have been also experimenting within a similar neighborhood, by keeping up with subscription based music supply, the Australian and global market will stay alive says Ninemsn Pty Ltd (1997 - 2007). The most innovative distribution of technological modernism within the global market is the Apple iTunes (http://www.itunes.com) system. Declaring more than thirteen million legal downloads. Apple has not yet announced their release date within the Australian market yet, however it will be inevitable. Apple iTunes allows the consumer to pay for their favorite tune, download it, use the tune as they like, however only accessing the ability to play that tune on their Apple iPod player and no other devices, thus limiting the cause for mass piracy. The one area that has succeeded against piracy of mass illegal music downloading is through convincing the consumers to pay for the downloaded music as ring-tones to their mobile phones. Ninemsn Pty Ltd (1997 - 2007) stated the ring-tone sales were escalating over revenue sales of one billion US dollars within 2003 alone, according to the IDC (http://www.idc.com.au). The modern consumers are demanding for more and more as newer kinds of technological devices and file delivery formats are being designed and released onto the market. The buying power has shifted from traditional delivery devices to more modern digital delivery devices and software. Global statistics have shown the consumers would rather unethically download illegal music through free systems such as Kazaa, because as the traditional music delivery devices such as Cd's and DVD's prices increase, the consumers are forced to buy less than what they had in the past because it is just too expensive to buy full albums and only essentially require half of the songs on it. This is one of the factors why consumers are moving towards the online music market and because it is extremely simple to find the songs they require online rather than searching in a If Music is the Food of Love, Log on 3 music store for wasted hours on end. If the battles against illegal music download systems such as Kazaa and Napster and continually defeated and if the online music stores such as HMV can possibly decrease their prices on music downloads or for just individual tunes to be accessed and paid for, it will eliminate a lot of forceful illegal downloads, because the consumer can pay only for the songs they require and not the un-needed. Many variables come into play as to how music retailers such as Sanity can approach the newly developing music market with grace and ingenuity, by incorporating various marketing techniques to establish the forefront in the emerging online music industry. First of all in October of 2005 Brazin had acquired the Australian company HMV, thus the consumers will be redirected to Sanity's website and still be able to enjoy all of HMV's benefits and functionality. This is an excellent Integrated Marketing Communications approach on behalf of Sanity as the HMV clientele will not lose their order history, accumulated HMV points, their music Wish List and My Collection data, keeping their consumers happy and decreasing the possible gap within the customer communications. Sanity have made it very clear in communicating their position to the public online music consumers and traditional music consumers, by increasing the availability of all the latest DVD's, music albums, movies etc to the public at special rates available only to the Australian public and that are priced better than the prices found on their merchandise in physical stores countrywide. Sanity ABN (1999 - 2007) "All prices at Sanity.com.au are in Australian dollars and apply to on-line purchases only and will not be matched at any Sanity, HMV or Virgin Music retail location." If Music is the Food of Love, Log on 4 By increasing Sanity's clients perception and visual stimulation, by enforcing their clients to be knowledge full of all their latest and future releases onto the market, enabling their clients to keeping their fingers to the pulse by creating wish lists of their desired albums and performing pre-orders of upcoming releases to be the first inline countrywide by a click of a button. Sanity provide for the clients to pay shipment costs only once regardless if an order is broken up due to availability of latest releases and more than one shipments have to be made. Great gift certificate orders can be placed by clients as a special surprise for their loved ones and it eliminates the need for the use of a credit card. Also by offering limited edition albums exclusively to their clients and increasing the ability to make an online purchase easier than taking out the wallet by offering the use of PayPal to their consumers. The increase in secure online shopping, reliable access and special music prices will definitely entice Sanity's target market and by advertising such greatness through search engines, online, televised and streaming radio advertisements of a good reputation will always be whipped into a growing market hopefully to overcome the illegal music industry. By means of rapidly changing the efficiency environment within which large online and traditional online music stores operate. Corporations such as Sanity can gain incredible control over the communication gap between them and their consumers by engaging their general clientele, online users, general traditional music buying public in miscellaneous surveys and competitions by using exciting Flash animations, increasing the user to carry on through the survey learning more about Sanity simultaneously as Sanity learns about them. Thus increasing their knowledge over what makes the general public tick, what percentages of the buying public fall into what price brackets, music genre's etc Remaining on If Music is the Food of Love, Log on 5 top of their consumers needs, desires and releasing their energy and inspiration gathered by these surveys into their online stores, enticing their consumers and new consumers to be inquisitive into trying and buying through their online store and forgetting about any illegal sites. The employment of the internet has actually amplified the total expenditure of music, whether legal or illegal. There are certain problematic occurrences for large traditional CD music retail distributors such as Sanity due to an increase in online illegal music downloads. Distribution of more than eighty percent of pre-recorded music throughout the USA by the RIAA (Recording Industry Association of America) and other affiliated companies, had stated that there had been a dramatic decline between year 2000 and 2004 in the distribution quantities of traditional music delivery formats such as CD's from enormous quantities of 940 million down to 760 million units. The peer to peer networks that are available free to the public, had increased the file-sharing activity and had plagued the online music market and causing staggering annual sales' losses of around $3.1 billion US by 2005. The objective would argued that consumers would download their favorite music to sample how the song sounds, delete the song and then order the album either online or drive to their closest CD store. However the likeliness of that occurring is dramatically lower than we think. Recording industries and artists argue that the distribution of music online reduces physical CD album sales, and that it will threaten the business of distributing the artists' albums. The increase in threatening online sales do affect the distribution quantities of traditional delivery of music albums, however there are a large amount of jobs that might have to eliminated If Music is the Food of Love, Log on 6 if there becomes a lack of need for the physical production of the CD albums. A large majority of the traditional music retailers have converted to online retail to balance the losses occurred from the lack of physical CD distribution and sales. Jeffrey Lim - University of Sydney found. "According to the International Federation of the Phonographic Industry (IFPI), digital music sales totaled $US790 million in the first half of 2005, compared with $US220 million for the same period in 2004 (IFPI News, 2005)." The distribution of online music is amazingly easier for the consumer to learn how to execute. There isn't a need for physical distribution, payments on shipping and packaging of the CD or DVD album, hoping it will actually arrive to the payee in the post. The need for printing, producing physical albums is not necessary to a degree, depending on the online order format. All one needs to do is simply allocate the selected album of their purchasing desire, send it to the shopping basket, and any other albums they require, through secure online confidentiality one can use PayPal or their credit card to purchase the order and they do not even need to leave their home, the delivery will be sent to their door if they desired, if they are ordering a full CD or DVD. If the consumer wishes to download a specific favorite song, there is no need for physical distribution, shipping and packaging costs, they can just order the song through the online purchasing site, acquire a password once payment has shown on the site and download their needed song. Problems do occur when as discussed before, the purchasers of the downloadable songs are overcome by the knowledge of hacking into the archives of such websites or acquiring a password generator and stealing the specific songs they desire without payment. The download If Music is the Food of Love, Log on 7 may be problematic for the legal purchaser and not be able to download the certain song even after payment, and losing their paid status. There may be fraud purchasing sites that steal the consumer's money before any transaction of goods has even taken place. Should an online music consumer have a slow internet connection, the download of the selected song may take a lot longer to download than if it were directly off a bought CD. The increase in connection speeds has increased the quantity of files that can be uploaded or downloaded to and from a selected site, increasing the distribution speed dramatically. When marketing for a large traditional music retailer such as Sanity, one needs to look at the variety of factors, such as demand for the new online music trend, applications used today that would increase the use and need for online digital music, the new and very large variety of the latest devices the consumer would see as 'trendy' to carry around with them and the bulkiness of the existing devices available, gain insight into the psyche of the consumer facing towards the new trends of online digital music market industry and away from the traditional music market, by assessing not only the consumers reactions, likes and dislikes to the new trend, we can also gain an incredible advantage over our competitors by assessing our competition, strategize for the future of our company and apply all the knowledge generated to surpass our competitors and provide the trend seeking consumers with exactly what they desire with ease and grace before they have even conceived a notion of their personal trend desires. By anticipating our competitors every move, their strengths and weaknesses and by generating a vast degree of knowledge over our competitors, we can interpret our every future move into profit. There are a few competitive marketing strategies that would work well in generating a positive stance on the latest's online trends today. First of all I would present a marketing If Music is the Food of Love, Log on 8 strategy through increasing awareness of the still available physical traditional music retail outlet just around the corner of the consumers' homes and of local bands and talents itching to be noticed without the consumers need to sample 'pirate' their music online, just to be heard. Through the distribution of invitations to all the listed online clientele of 'Sanity' and by advertising throughout the national and international markets online, televised and radio adverts and in the local town of course, consumers can enjoy their favorite local band play on a newly erected stage within our retail store and by broadcasting their live performance online, accessible through a specialized section of our website. Promoting the local talent, selling their music at a discounted rate only during the time of their live online performance would therefore increase masses of awareness of the traditional retail music store and especially promote a new line of customers on the online retail store, then later maybe charge a nominal fee for online users to be able to access the live performance section of the website and watch their favorite band from the comfort of their homes, especially if they live too far away from a local store. The fight against piracy will continue for a long time to come, hopefully the battle will end, piracy will cease to exist and retailers, music industrialists and struggling artists can be rewarded for their generous contribution to the music era. Total Words: 2, 435 References Ninemsn Pty Ltd (1997 - 2007) Digital Living. 'Will Downloading Land You in Jail' - Angus Kidman Sanity ABN (1999 - 2007) More Movies - More Music 'Online Music Store' http://www.sanity.com.au Jeffrey Lim - University of Sydney "Case Study 2: If Music is the Food of Love, Log on" RIAA (accessed: 20 January 2004) Recording Industry Association of America 'Yearend Report on Market Report on U.S. Recorded Music Shipment' (See Case Study) www.riaa.com/news/newsletter/pdf/2004yearEndStats.pdf Association for Computing Machinery (2003) Pages 107 - 111 Communications of the ACM,Inc 'Digital music and online sharing: software piracy 2.0' http://delivery.acm.org Clark, D. (Sept. 19, 2000) Steps by music industry to halt Internet piracy may be futile. 'The Wall Street Journal Interactive Edition') Read More