Attracting customer interest
The difference between these companies is that Virgin can benefit from using the profits generated from products which are on their peak of popularity (e. g. financial services) either to launch new products or support the products which are at the decline level (e. g. CDs) of the Product Life Cycle. In order for companies such as HMV, Virgin and Music zone to keep up with the competition and subsequently boost their profits, they aim to create brand awareness. This is because this will make them trustworthy and customers will recognize them.
Apparently, today’s music industry depends on the ongoing development of technology. Companies have to sort of reposition themselves in the market place or try to penetrate into new markets in order to appeal to customers. One of the main technological developments is the Internet. Companies started setting up their own websites. The Internet or E-commerce is a new market where companies can boost their profits by expanding their customer base and meeting the needs of customers who prefer to for example shop online.
The competition led companies such as HMV to set up their website in order to expand their customer base. By expanding their customer base, the company aims to boost their profits and beat competitors such as Virgin. It is vital that HMV’s online presence to be similar to their shops. It eases customers to recognize HMV by colors, logo, products and services sold both in the stores and on the Internet. The products that HMV sells are mainly CDs, Vinyl, music books, MP3 players, Ipods, posters, DVDs, Video, games etc.
The picture below shows that all these products are sold online as well. In terms of price difference, the prices are the same for products which get delivered to the doors. However, as it has been said previously, the digitalized music is much cheaper. Many customers can benefit from buying mp3 format music as it is convenient : no need to shop, it automatically downloads onto your portable device via your laptop/computer, the prices are cheaper due to the slump in the costs for items such as album covers and booklets. In comparison to HMV, Virgin aims at a wider audience.
In other words, the company reaches people interested in music, films, travel insurance, mobile, finance. This picture shows, the strategic similarity used between these companies. The color, the logo, services and products presented on the website are the same as in their stores. The online presence can help the companies to expand their customer base, meet the needs of customers better by having a website and stores. The prices of certain products such as Mp3 music are cheaper because of a lower overhead costs reduction in staff being hired and album boxes.