Competitive Strategy - Essay Example

Competitive strategy: Films and the Internet One of the most important characteristics of the Internet, which makes it a very attractive trading platform, is that technology allows for the collection of consumer behavior, attitudes and profiles in an efficient, speedy and organized manner. For example, when one purchases a movie in Amazon.com, the purchase process and purchase behavior is recorded, stored and analyzed. Usually, this is done by a sophisticated database management system that accomplishes the task of data mining at a blink of an eye.

The offshoot is that film companies or online retail sites such as Amazon.com can afford to analyze each consumer data and provide specific services and product characteristics that meet his profile requirements. The processes involved take a few seconds to finish due to the sheer speed of today's broadband technology. The data generated by Internet technology allows movie distributors to tailor their offerings according to several variables such as the demand, the availability, popularity, and other factors that are revealed in the individual client data.

It has become easier, hence, for film companies to introduce price formation, price differentiation and price bundling (Meier and Stormer 2009, 21). The efficacy of the Internet as a film-selling platform is underscored by the research that found about 121 million Internet users per month streamed or downloaded video in the United States back in 2007 and that this was expected to swell to 165 million by 2011 (Plunkett 2009). Another important dimension to e-commerce is the benefit brought about by the digitalization of films.

As films are compressed into digital files, Internet users can download them easily besides buying hard copies such as those in DVD and Blu-ray formats. As a result film distributors can now offer different products and could package films either for sale, for rent or for subscription (OPEC 2009, 45). The digital movie files are also easily recopied. This, in effect, made it easier to lower prices and have pricing become more flexible especially in relation to a particular consumer demographic.

The Internet is a great enabler. The technology effectively decimated several elements in the process by which goods and services reach the consumers. In a way, the Internet solved the mass production dilemma of having to design and sell a product to a generalized public that commands uniform product and service attributes. The way films are sold online, as has been pointed out by this paper, is a case in point. Today, a buyer will find that purchasing a movie has become differentiated because the price and value-added goods and services vary; there is no uniform strategy in the business of selling to the viewing public.

Works Cited Meier, Andreas and Stormer, Henrik. eBusiness & eCommerce: managing the digital value chain. Berlin: Springer, 2009. Organization for Economic Co-operation and Development (OPEC). Remaking the movies: digital content and the evolution of the film and video industries. Paris: OECD Publishing, 2008. Plunkett, Jack. "Plunkett's E-Commerce and Internet Business Almanac 2009". Google Books. 2009. Web. Accessed 15 Jun 2011.