VAWMi TUNES - Marketing Strategy, Business Environment, B2B and Web Presence - Assignment Example

VAWMi TUNES Table of Contents 1.0 Executive Summary......................................................................................................3 2.0 Overview of the Business.............................................................................................4 3.0 Marketing Strategy.......................................................................................................4 4.0 Business Environment……………………..................................................................6 5.0 B2B and Web Presence................................................................................................7 6.0 Legal and Ethical Environment....................................................................................8 7.0 Conclusion ……………………………………………………………………………9 8.0 Works Cited…………………………………………………………………………...11 1.0 Executive Summary E-commerce may be construed to refer to the process of not only buying but also selling goods and services via the internet. Mostly, the internet used in this kind of business is the World Wide Web. In this kind of business, potential buyers log onto the sellers website and shop from the catalogue maintained in the buyer’s website in something that can be said to be a virtual mall (New Age International, 1979: p5). Once the buyer decides to buy, he will do so via electronic money transfer and thus it is the responsibility of the seller to ensure that the goods or services so purchased are safely and timely delivered to the buyer. Despite the security concerns in business transactions as far as e-business is concerned, e-business or e-commerce for that matter has continued to gain popularity by the day. Internet marketing is part of e-commerce and may be construed to simply refer to the marketing of goods and/or services over the internet. Ever since the discovery of the worldwide web, there has been a shift towards internet marketing because of a myriad of reasons. First, the internet offers a low cost marketing option as compared to other options. Secondly, the internet is able to reach a wider audience as compared to the other offline forms of marketing. Finally, the internet is a unique medium of marketing because of the interactive nature and thus it is able to not only provide instant responses but also elicit instant responses from clients and audience in general (Hofacker, 2000: pp89-93). Furthermore, the hastily embrace of internet has been as a result of the alleged wider scope of the internet marketing. The scope is wider because it involves both digital media such as e-mail and the wireless media. It is also important to note the fact that internet marketing also involves management of customer data which is digital and also an electronic customer relationship management (ECRM) system. In short, the internet has been able to provide most workable solutions that have been lacking in other forms of marketing for a very long time and thus the popularity of internet marketing is not coincidental. Internet marketing is not only able to foster brand identity but also manages to enact both brand personalization and brand commitment. A number of organisations in various industries have been able to invest in internet marketing because of its viability. It is for this reason that VAWM i- Tunes seeks to venture into the internet arena to do business and market its products. The business shall be doing business of selling music online. This paper seeks to illustrate the effectiveness of e-commerce by giving a brief overview of the business, the online marketing strategy, the online business environment, the web presence and the legal and ethical environment of the business. 2.0 Overview of the Business VAWM i Tunes will be business that shall deal with online music. It will sell audio music and ring tones through the internet just the same way as the apple conducts its business. All types of audio and visual music shall be available for download by the customers at a cost payable over the internet as well. All the operations of the business organization will be more oriented to the internet arena as opposed to the normal business environment. Since the business is starting, it will be localized to Australia alone with future plans to expansion throughout the worldwide web. The main source of revenue generated will mainly come from the online sale of music. This kind of revenue model is called Fee-for-transaction revenue model. In this model the business shall offer services for which a fee shall be charged. The service entails provision of songs to the customers. The business makes it easy for the customers to download the music so that they can enjoy listening to their favorite music having paid the amount per download required.The more the number of downloads by customers, the more the revenue generated and vice versa. Therefore, to maintain the desired amount of revenue, there is need for an aggressive online marketing so as to gain a competitive edge in the market in a bid to achieve the desired amount of revenue. 3.0 Marketing Strategy Internet marketing continues to be popular because it combines the dual potential of internet for marketing; the creativity and technical aspects. These two greatly enhance the aspects of marketing such as the development of design, advertisement and sale. Internet marketing engages the customers through various stages such as SEM (search engine marketing), Banner adverts within various popular websites such as face book, marketing via e-mail, SEO (search engine optimization) and web 2.0 strategies. These various stages of customer engagement afford a wider audience and have a scope component as well. When one talks of internet marketing, a business model within which the internet marketing is conducted is implied. Internet marketing is related to a number of business models. Some of these models include e-commerce, affiliate marketing and publishing among others. Most of these models are based on the particular needs of both the individual customer and needs of the company or organisation that launches the internet marketing campaign. As far as the e-commerce model is concerned (model that is embraced by most organisations that carry out internet marketing) the goods and/or services are sold straight to the customers or other business organisations without going through intermediaries. This approach is able to afford the internet marketing a one-to-one approach. In this one-to-one internet marketing approach, the targeted consumer is usually browsing alone and thus the advertisement message is able to reach him/her personally. This approach is mostly used along with what is popularly known as search marketing. Search marketing is an internet marketing scenario in which the advertisements are based on the search keywords that are entered by the person browsing the internet (Hanson, 1999: pp245-255). Therefore, the marketing strategy that shall be used is the SEO (search engine optimization) within the e-commerce model. This will allow the customer to enter the title of the music required and found in our website having searched for the term VAWM. Anytime V and A are entered, our website shall appear at the top of the list as is the case in SEO (search engine optimization) strategies. Similarly, the social networking sites such as face book, my space, u-tube etc shall be used to help advertise and market our website entirely. To demonstrate the marketing strategy that can be used to make profits it is better if the marketing strategies used similar companies such as Apple are considered. From the comparisons made between Apple and its rival online music service providers such as Sony Music, Universal etc, it so appears that apple is prepared to go an extra mile so as to make the online music business profitable (Healey, 2009). For instance it hit in pricing strategy throwing all its competitors out of the market competition. It offered price per download system as opposed to monthly subscription which most of the customers were reluctant to commit to. Actually, Apple preferred to give the customers what they want. This is called differentiation and it serves to give a competitive edge top a company in the market (Baker, 2003). Secondly, their system made the selling of online music easy. The system is easy to use and as such selling of music online becomes an easy affair. As it is advertised the system is hip, quick and easy as seen fro their slogan: “It’s hip It’s quick It’s easy” (Business Week, 2006). Therefore, VAWM iTunes aims at borrowing from Apple as far as the pricing strategy is concerned and the easy to use system. VAWM purposes to use price per download system as opposed to monthly subscription which most of the customers were reluctant to commit to. Similarly it shall ensure that its system used for selling online music is easy to use hence making the entire business of selling online music quite profitable. 4.0 Business Environment The business environment as mentioned earlier is entirely online. The environment is full of other market players such as those mentioned in the foregoing section. These players are worldwide ventures and the fact that VAWM shall be localized to Australia serves to show the these player may not be quite a competition because VAWM shall purpose to give customer preferences to the Australian customers and market segment which it understands better that any other market player. VAWM iTunes exists among other competing services that offer online music. Apple is one such company that provides online music and videos to its customers. The common customers for the online music are the youth who are eager to play their favourite music and videos. Other customers include the advertisers who may wish to use certain music or videos as a theme in their advertisements. TV and radio stations are yet another example of the customers who benefit from the iTunes online music services. As such the market segment is more oriented toward individual buyers who download it to their iPod to be able to replay it at will. Actually, Apple has managed to move past the PC market where it commands a meagre 3% thus venturing into online music and other consumer products and services as a major source of revenue. This is the target that VAWM has: to become a major market player as far as online music is concerned. Be able to beat apple and other players in the Australian segment. 5.0 B2B and Web Presence What is the flow of the online music as far as the services of iTunes are concerned? A company offering the service such as Apple or VAWM buys the songs from the producers or musicians themselves. This is often done in terms of royalties in which the musician who sang a specific song is paid a certain percentage of the amount realized from selling his/her song. These songs are then compiled and stored in what is commonly called the iTunes store or music store wherefrom the songs are bought then downloaded by the help of the iTunes application. The customers can buy using their credit cards before the song required can be downloaded (Peterson, 2009). It is evident that Apple is not alone in this service of selling online music and/or videos. There are a number of competitors doing the same business. These competitors include but are not limited to Universal, Warner, Amazon, Bertelsmann, Yahoo, Sony Music and the song-swapping services offered by the Kazaa who are being held on a legal Tussle. Unlike Kazaa, Apple has ventured into an online music service that is legal and pays as well. The question that remains is how Apple has been able to beat its competitors on this front. To begin with, the online music service offered by Apple is supported more by their unparalleled and very popular iPod. Therefore, what apple offers is a package which the competitors have not been able to offer; Apple iPod + iTunes program + Online songs from apple = Apple online music Package). Secondly, Apple is able to sell songs that the other competitors have never laid their hand on. Such music includes pieces like that of cuts from U2, music from Sheryl Crowe, Sting and Bob Dylan. These and many more are songs that Apple sells which their rival music sites have never been able to offer. Furthermore, apple, besides having the blessings of more than five key record labels, offers the best price of 99cents per download as compared to their rival music sites who charge more (Healey, 2009). Finally, Apple has more than 200, 000 songs in their music store most of which were purchased from Loudeye digital music company which owns more than 3 million digital songs. Apple tries to prevent piracy by allowing the customers some freedom of moving music to other PC, CDs and iPods. Apple allows music to be moved to maximum of three PCs, 10 CDs and unlimited iPods. This is unlike other music sites that greatly limit movement of songs only to one PC and charge extra fee if the song will be moved to another PC, CD or iPod (Peterson, 2009). As a new company in the Australian segment, VAWM iTunes will focus on following Apple’s foot steps so as to design a package that it will use to sell its online music. VAWM plans to design through other companies and service providers, an ipod specifically branded and fitted to download store and replay the songs and videos downloaded from its website. It is better to offer the service as a package as opposed to simple selling of online music. 6.0 Legal and Ethical Environment As mentioned earlier, some players in the market have had to contend with some legal tussles which they could otherwise have avoided in the first place. VAWM just like Apple plans to do a legal dealing as far as selling of online music is concerned. The offering of this service as a package will go a long way in ensuring that the legal aspect of the business is taken into consideration. How legal can this business be? First, a clear representation of the revenue is supposed to be kept for tax purposes. Secondly, the songs sold should be those that are bought from the singers themselves and the produces so as to avoid instances of piracy. It is common knowledge that piracy is a crime and VAWM will work hard to ensure that the business shall gain the blessings of major music labels so as to make the entire dealing legal. On the ethical arena, VAWM works hard to ensure that the videos that re downloaded from its site are never pornographic and are aimed at enriching the users. On the side of pricing, the company shall work to ensure that it offers the lowest price per download in the market such that through an aggressive marketing strategy and business model, the company will .be able to make a pro-fit above all the other competitors in the market. To prevent piracy, the company plans to allow the customers some freedom of moving music to other PC, CDs and iPods. Allowing the music to be moved to a maximum of three PCs, 10 CDs and unlimited iPods will serve to limit the instances of piracy in the customers’ end. This is a legal and ethical responsibility of the company to prevent piracy through its service model. This is unlike other music sites that greatly limit movement of songs only to one PC and charge extra fee if the song will be moved to another PC, CD or iPod (Peterson, 2009). 7.0 Conclusion The fact that the budget is limited to a maximum of $ 50,000 AU, the business is limited to the Australian market segment alone wi0th future plans of gradual expansion to the global market. The business and market model embraced i.e. the e-commerce will help maximize the potential for returns on investment. The money will be used to design and develop a website and SEO system and the billing systems that will help make the business a reality. The partnering and achievement of blessings from key music labels requires money but VAWM will commit to gain the blessings and pay slowly. As far as the market environment is concerned, the company will ensure that it gives the customers their custom preferences at the lowest but profitable pri0ce possible in the market. The role model for the company and its business is Apple and VAWM seeks to walk on its footsteps perfecting the strengths of the company and avoiding the mistakes committed by Apple. The marketing strategy embraced by the company should enable profitability and market competitiveness of the company. 8.0 Works Cited Peterson K, (2009): Times a-changin' for Apple, online music, Seattle Times, retrieved on 27th May 2009 from http://community.seattletimes.nwsource.com/archive/?date=20030429&slug=apple29 Healey J, (2009): Record Companies like Apple System for Downloading Songs, Los Angeles Times, retrieved on 27th May 2009 from http://community.seattletimes.nwsource.com/archive/?date=20030305&slug=applemusic05 Business Week, (2006), McGraw-Hill, pp38-41 Baker J M, (2003): The Marketing Book, Butterworth-Heinemann, pp380-385 Hanson W, (1999): Principles of Internet Marketing, South-Western College Publishers, pp245-255 Hofacker C. F, (2000): Internet Marketing, Wiley Publishers, pp89-93 New Age International (1979): E-Commerce, New Age International, p5 Read More