Napster Should Change Its Marketing Mix Strategy Introducing the Digital Media - Case Study Example

Interactive and Internet Marketing Executive Summary The key findings of this report indicate that Napster as an Internet provider of music downloads has considerable strategic plans for service provision and the marketing mix adopted by the company id ideal and applicable for its success. However, it has been analyzed that the company is loosing its share market to leading competitors including iPhone that has had the introduction of new and advanced features for the users. Napster gains their main revenue from permanent music downloads and online subscriptions which are being outdated by the digital media that other providers are using in the provision of the service. On the same note, Napster's subscription model is under criticism from the users since it is a service where users or the ideal subscribers do not ‘own’ the music up until they purchase it, and this is usually at an additional cost, for instance burning it to CD. This serves as a negative attribute and reduces the reputation of the service brand with customers preferring other free services. The service consumers are only allowed to play the music either on a portable player or on a PC, but for only as long as they remained subscribed to Napster, and this is a challenge in its marketing. To customers, they feel that Napster has a lock-in which is not favorable to many users across the gob. The Report recommends that for Napster to compete effectively with others in the market, it will need to strategize on digital media as a solution to advancing its service provision to the users. The report recommends, therefore, that Napster changes from Dialogue to Trialogue, push to pull, one-to-many and many-to-many communications and strategize advancement from ‘lean-back’ to ‘lean forward.’ These will be distinguished strategies if applied in the marketing mix of Napster and in its survival as a successful service provider of music over the Internet. 1.0 Introduction Napster is a company was for long in history used as a service for ‘free’ peer-to-peer (P2P) music sharing. However, record companies posed a legal challenge to the company due to lost revenues featured on music sales that eventually forced Napster to close. However, the company brand was purchased giving it a second incarnation that help it offer a legal music download service and was able to compete directly with other providers including Apple’s iTunes. Over time, it developed into holding one of the high-prolific companies providing music download and listening options. The capability to try different tracks proved irresistible with Napster use by interested Internet users peaking and seeing over 26.4 million users across the globe in February 2001 use Napster. The company got tremendous PR and millions of users started using the service. It drove through to success even with the existing challenges and by 2008 Napster had estimated 830,000 subscribers in the United States, United Kingdom and Canada paying up to £14.95 each month for them to access about 1.5 million songs. What is even better is that the company also by then started seeking the launching of the service in other countries including Japan through partnerships. The online environment engaging music downloads has changed, and there are many legal music downloading service providers as well as increased adoption of broadband meaning that it is a competitive field. The success of Apple iTunes with the introduction of its portable music player, the iPod early in year 2005 had achieved over half a billion sales, and this has been a exciting challenge for Napster making the company realize that it needs to revise its marketing strategy and cope with the competitive environment. This report aims at analyzing Napster’s marketing mix and evaluating its compatibility with the existing environment, therefore, knowing how better to make the company succeed. The report provides this analysis and looks into how digital media might be of help when applied to the marketing strategy of Napster. The structure of the report includes a critical evaluation of the 8 characteristics of digital media as they apply to Napster, followed by recommendations and strategies for each of the 8 characteristics for Napster and a final conclusion summarizing the report as it applies to Napster Case Study. 2.0 Critical evaluation of the characteristics of digital media as they apply to Napster 2.1 Monologues to Trialogue With the emergence of the music service over the Internet in the mid-1990s, marketers established illustrious strategies (Whittaker & Hill 1998, p.257-264). The establishment of a dialogue with brands replaced the flat monologue, which characterized media and opened up new vistas of committed relationships between consumers and brands (Rosa 2010, p.214 – 240). However, over the past few years there have been dynamic emergence of more powerful systems than the dialogue (Cowlan 1978, p. 116-121). It is a more revolutionary and valuable strategy named as the Trialogue. Looking back in about a decade ago, the true impact of revolutionized digital media was not finding new ways of connecting brands to consumers, but it was geared towards connecting the consumers to each other (Cunningham & Graeme 2000, p. 259-78). With the use, of Internet users are able to collaborate to create software, releasing back onto the web while they share information with one another (Whittaker & Hill 1998, p.257-264). The user cooperate to drive down prices of respective services joining forces in bringing down brands, which let them down, as they post reviews and videos of the ideal underperforming products and services (Horton 1979, p. 32-55). For Napster, it has not been able to integrate Trialogue making it a challenge since many customers now want to go for services or products, which they can have control over. The company still holds to the Dialogue, and this is becoming outdated in the digital world. 2.2 The Break up (Push to Pull) Push to Pull is a digital media tool applied by users in the search for content (Cheskin 2000, p. 8-9). New media contrast precisely with older forms in that specific users request custom content (Cowlan 1978, p. 116-121). Instead, content from a website for instance music is "pulled" by the consumer, and not "pushed" as purposed by the media organization (Rosa 2010, p.214 – 240). In this case, it all means that the consumer takes charge of the content (Whittaker & Hill 1998, p.257-264). For Napster, it still has the push strategy in its marketing mix where it delivers content, which includes the music to the consumers. The customers can only download what the company has posted on the website, and they are restrained to pull any content on the website. This is a challenge and a negative attribute in itself because consumers need some service they can take control of themselves than rather pushed by the organization. 2.3 From one-to-many to one-to-some and one-to-one DOI is actually an actionable identifier. In visiting particular sites, clicking on a DOI derives some action. In the preliminary stage of implementation, this is purely a single action (Horton 1979, p. 32-55). With a click on a DOI it practically takes a user to a single URL. This is what is referred to as "one-to-one". On the other hand, "One-to-many" is a case where one DOI can be of use to achieve many action possibilities (Noel & Denise 2010, p. 98-109). The full DOI implementation, therefore, implements such an action. Napster’s website operates on a "one-to-one" as the case with the users who visit to download music. They can, therefore, not perform many actions together making it an inefficient service. An upgrade is required instantly for the company to go in line with the advancement in the digital media industry. 2.4 From one-to-many to many-to-many communications Digital media have the capability of altering the size and identity of an audience (Cunningham & Graeme 2000, p. 259-78). In advertising, many media including the printing press, TV and the radio allow for messages to reach many people, but they are a one-way interaction (Rosa 2010, p.214 – 240). Napster as analyzed utilizes these media in its advertising something that needs an upgrade within the shortest time possible. Offline marketing channels for Napster include television, print and radio advertising. The online marketing program of the company includes only advertising placements on several web sites and search engines’. 2.5 From ‘lean-back’ to ‘lean forward’ In explaining the "lean forward" concept, it is what a user does when in front of a device for instance a computer/laptop/ desktop, where the user "creates" written content (email), or by and large works out on textual content (edit a presentation or a document) (Rosa 2010, p.214 – 240). On the other hand, "lean back" is what the user does when in front of a device for instance TV, where the user consumes media (video) (Jenkins 2006, p.29-37). Napster has its content as "lean forward" and, "lean back" where users can download, edit and watch music videos of their choice. 2.6 Digital medium changes the nature of standard marketing communication tools such as advertising Advertising is a key concept as applied in the respective companies (Rosa 2010, p.214 – 240). Leadership particularly in the digital media comes from knowing exactly what customers need because the company is right there with them and heeding to their advice (Cowlan 1978, p. 116-121). For a company like Napster serving millions of advertising users, it needs to deliver audiences across leading networks around the globe. The users should be working with customers side by side in managing their digital marketing and in turn, making sure that they are making the most of their advertising spends (Whittaker & Hill 1998, p.257-264). 3.0 Recommendations and strategies for each of the characteristics for Napster 3.1 Monologues to Trialogue There is a challenge to Companies that still use the monologue or dialogue as users of the respective service relegate them to the supplier position, and are talking about them, and precisely not to them. For Napster, adhering to the status quo is the best opportunity for its brand in a way that it reorganizes its self and plays the role of the facilitator. The company needs to recognize the bulk of the discourse taking place between users, and their role in this case is enabling, empowering, listening and, just occasionally, talking to users on matters regarding the online service (Noel & Denise 2010, p. 98-109). 3.2 The Break up (Push to Pull) Consumers need some service they can take control of themselves than rather pushed by the organization (Rosa 2010, p.214 – 240). Therefore, Napster needs to change its marketing strategy and engage the ‘pull’ option, therefore, giving customers a role to play in monitoring and running the online service. This will make them proud of owning the service, which they feel delighted to us and invite friends in the process running to the advantage of the company 3.3 From one-to-many to one-to-some and one-to-one The movement to computer-mediated communication (Rosa 2010, p.214 – 240) is what Napster requires in its marketing strategy to reach the maximum audience. This approach allows for flexibility in access to size as well as levels of audience. Email for instance can be sent to many at once listing each recipient individually or creating a mailing list of many audience names for mailing periodically (Cheskin 2000, p. 8-9). In this case, the intent of the sender determines who receives that particular message (Cowlan 1978, p. 116-121). With this type of messaging, Napster would be able to send messages to a huge forum of people. The architecture of the website, however, changes the pattern of interaction within the group (Wilson and Howell 2008, p.1059-1083). One sends a particular message to the group, which if it has a moderator, he or she decides if the message is great or not and with the assumption that the message is accepted, the particular message is read by the respective users choosing to read that message (Ronald 2002, p.175-193) 3.4 From one-to-many advanced to many-to-many communications Many-to-many communications are a mediated, interpersonal communication, which allows strangers to become involved particularly in an electronic community with no commitment personally (Jenkins 2006, p.29-37). As opposed to the earlier one-to-many communications, the communication now is large scale using chat systems that link many people together and allowing multiple channel interactions (Rosa 2010, p.214 – 240). What is of the current requirement are new interfaces to better appreciate the culture of systems as well as research into new forms of mass multiple interaction of electronic communication (David 1993, p.17–34). Napster has been using the one-to-many approach in marketing its website and the contents as they send a particular message to distinguished users and it needs to switch to facilitate better communication in its advertising. This will help reach out the maximum number of customers and create awareness of the service in an advanced environment. 3.5 From ‘lean-back’ to ‘lean forward’ In its operations, Napster needs to take up "Convergence" in practice, which means creating a service, which feels 100% fine ideally for both "lean forward" and "lean back". On another note, convergence definition is taken to be the interlink of computing as well as other information technologies, communication networks and media content, which have arisen resulting from popularization and evolution of the Internet including the products, services and activities that have emerged in the advanced digital media space (Wilson & Howell 2008, p.1059-1083). The idea is for Napster to create a Lean Back environment that would enable users to browsing Large Personal Multimedia Archives precisely in a Lean-Back Environment and give it competitive advantage over its competitors in the provision of these services. 3.6 Digital medium changes the nature of standard marketing communication tools such as advertising Using Digital medium for Napster would tremendously help in its advertising. In this case, Napster can apply Video and rich media. This is what will help engage its extensive coverage of the audience, with the video and rich media helping it connect with the audience in new ways (Ronald 2002, p.175-193). This way, Napster will be finding the right audience within the Global region and deliver creative to the audience easily in a wide range of diverse digital formats, including video as well as other rich media formats. Some of the possible introductions include mid-roll, post-roll and pre-roll, flash and in-banner (Wilson & Howell 2008, p.1059-1083)and this will help Napster explore the types of media advertising, which are right for the company. Napster can also engage in The Global Web Alliance that would help tap into a digital advertising alliance of millions of sites around the globe. The company will be able to engage new users every month segmenting the audiences in a way that it is able to deliver the most value to the company, and give it better return on audience (Rosa 2010, p.214 – 240). These methods will offer Napster, the most advanced capabilities of targeting users that include demographic targeting, behavioral targeting, day part targeting, Geo-Demographic targeting and retargeting. The Global Web Alliance will also be of value to Napster as it will help it advertise in different formats, which include the most advanced rich media as well as video formats meaning that it will target and engage advertising in front of the appropriate customer or users. 4.0 Conclusion Napster in its survival as an online service provider of music has been in business for many years. Its marketing mix strategy has been working well for the company in increase the number of users as well as profitability. However, due to the competitive nature of the industry, there has been a noted decrease in profitability. In reality, Napster will need to change it marketing mix strategy particularly introducing the Digital Media which in turn will be running the company’s service and keep the company up to the expectation of the user. With the adoption of Digital medium, this will change the nature of standard marketing communication tools for the company such as advertising to the better and a brighter future of Napster creative a competitive advantage over its rivals in the market share. References Cheskin, R 2000, Designing Digital Experiences for Youth, Market Insights Series, Fall 2002 pp. 8-9. Cowlan, B 1978, A Revolution in Personal Communications: The Explosive Growth of Citizens Band Radio, Inter/Media Interpersonal Communication in a Media World, Oxford University Press.1979. pp. 116-121. Cunningham, L.& Graeme, T 2000, The Media and Communications in Australia (second edition), Allen & Unwin, Sydney, pp. 259-78. David, M 1993, A New Medium for Advertising: The Postcard, 1900–1920, European Journal of Marketing, Vol. 22(8), pp.17 – 34. 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Wilson, O. and Howell, G 2008, communicating in the new interactive market space, European Journal of Marketing, Vol. 42(9) p.1059-1083, Read More