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Many companies are well-known to consumers by their corporate names, including manufacturers, chain retailers and service providers. The corporate name may serve as the leading brand identifier (like an ‘umbrella’ name) for the company’s products or services. But furthermore the corporate-level brand name is the gate to access the organisation’s image as held in the public opinion of consumers. In the last decade companies are increasingly judged by their values, culture, and market and public conduct. Consumers are more strongly influenced in their choice of products or services of a company by what they think of and how they feel towards its corporate brand.

A Tel-Aviv-based strategic management consulting firm, TACK, constructed a two-dimension metric for assessing the image strength (or sturdiness) of companies in Israel. The metric comprises a rational-oriented ‘pillar’ named Logic and an affective-driven ‘pillar’ called Magic. Each dimension of the image strength metric is measured by two (rating-scale) items.

Logic represents how much a company is appreciated by consumers, and to what extent the company makes it worthwhile for consumers to be its customers.

Magic expresses how much a company is loved by consumers, and to what extent consumers believe that the company cares about its customers.

Magic pertains to the emotional ties between the company and its customers and is therefore particularly important to the relationships built by a company with the customers. We cannot underestimate the importance of the logical or cognitive-based evaluation of the company, by weighing its advantages and disadvantages, as the basis for the interest and preference consumers show in using the company’s products and services. However, reasoned appreciation of the company and its offerings will likely not hold-up a relationship without developing an attachment to the corporate-name brand.

TACK applied its Logic & Magic metric for the third continuous year in 2019 to 71 Israeli companies (e.g., food producers, retail chains, telecom service providers, banks). Measures were collected in a survey of 503 adult Israeli consumers (Hebrew-speaking). The companies are not necessarily managed purely as a ‘branded house’; however, this study is not concerned with additional brands owned by the company (e.g., brands that may be endorsed by the corporate brand name or products positioned as sub-brands). The demonstrated mappings of corporate brands (in Hebrew), along the dimensions of Logic and Magic, bring forward some sobering realizations shared below:

Firstly, it is noticeable that, from a consumer perspective, companies that are doing better on the logical-functional front are also more successful on the emotional front, and thus are doing better overall in connecting with consumers. We cannot conclude from this a cause-and-effect relation. But the findings do suggest that a wise strategy that is sensitive to consumers (i.e., it sees things through the eyes of consumers) can win on both fronts. In other words, a company as such that succeeds, through its strategy, in gaining the appreciation of consumers for its performance and advantages of its products and services, is also likely to win the affection, trust and approach of the consumers.

There are hardly any corporate brands that seem to get a high score on Logic but relatively lack in their score on Magic, and vice versa. This implies that a company cannot sustain a ‘cold-minded’ appraisal of its performance and offerings while failing to win the hearts of its customers; and just as well, a company cannot sustain an affectionate connection with its customers without establishing the foundation of approval of its functional benefits to customers (e.g., being relevant and attractive). Nevertheless. it should be noted that the spread among corporate brands with relatively higher Logic and Magic scores is greater than among brands with relatively lower scores on both dimensions (there are more of them and they are more condensed). There is still much variability among the best performing companies — they are not consistently doing better in the same way.

Secondly, the quality of products and services is just one of the factors consumers likely consider in their logical-functional evaluations, and is possibly not the more prominent one. There seem to be large differences in perceived quality of the products of at least some of the companies or in the weight assigned to quality. Moreover, companies whose products appeal in their high quality or expertise to only a relatively small segment of consumers (a niche) seem to fall behind and do not come out favourably in this type of all-market brand rankings. It is not so surprising to realise that the stronger and leading corporate brands are those of companies that aim to fulfill the needs and preferences of the wider common base of the mass market.

Let us look at a few examples:

  1. In the category of retail food chains, a heavy discount retailer, Rami Levy, is positioned close to the top-right corner of the map (both in its category and overall) with high Logic and Magic scores, while a delicacy retailer Tiv Ta’am is at the bottom-left corner of the map. The two major food retail chains are in-between, one in the top-right quadrant (Shufersal) and the other in the bottom-left quadrant (Bittan [Mega]). Tiv Ta’am may bring better-quality products (e.g., fresh produce, imports of delicacies) than other food retailers, but its stores are considered too expensive, lucrative, and they are not liked. Rami Levy and Shufersal are listed among the Superbrands of Israel for 2018 in the retail category.
  2. In the category of coffee houses, we find in relatively high positions the low-cost, basic-service chain of Cofix, and the espresso-bar, self-service chain Aroma. In the worst position we find Arcaffe, an Italian-style chain of coffee bars serving fine coffee, sandwiches and other products, but it fails to receive the appreciation of the greater public for their offerings and service. Aroma is much more popular although their products and its serving standard are moderate. Yet Arcaffe is considered more ‘top-notch’, made for European-connoisseurs, and is relatively more expensive. Eventually, Aroma and Coffix are also much more emotionally appealing to Israeli consumers than Arcaffe. Roladin, a bakery and coffee-house chain, can be argued to be much closer in quality and service standard to Arcaffe than to Aroma; yet, Roladin is appreciated and considered worthwhile (Logic) similar to Aroma and is even a little more loved and cherished (Magic) than Aroma —  the advantage of Roladin over Arcaffe seems to be that they understand better what the greater part of Israelis like to eat and expect to find in a coffee-house for a light meal. Aroma and Roladin are listed among Israel’s Superbrands of 2018 (dining out) whereas Arcaffe is absent.
  3. In the media category, among the news press publishers, HaAretz holds a much lower position on both Logic and Magic than Israel HaYom; Yediot Aharonot is located closer to HaAretz. Two marked differences between them: (a) HaAretz is left-leaning (affiliated with the Guardian and New-York Times) and Yediot is oriented to the centre-left, whereas Israel HaYom is right-wing; (b) HaAretz is superior, especially in some areas, in quality of commentary and analysis to the two other newspapers (tabloid-fashioned). But the political left, and the HaAretz newspaper associated with it, are out of favour in recent years, and perhaps as a result the tolerance to its reporting by large circles of society is low, no matter its apparent news quality. [It is noted that all three also have a news website, though in the case of Yediot the online channel is branded separately as ‘ynet’ — it is positioned close and just a bit better than the press edition]. Yediot (+ynet) and Israel HaYom are listed in the media category of Israel’s Superbrands for 2018 but HaAretz is absent (its economics and business branch TheMarker is included).
  4. Interestingly, the researchers of TACK report that preference for Arcaffe and for Tiv Ta’am, each in its category, is stronger among consumers who describe themselves as leaning to the political left. The relevance of political attitudes to dining-out and food shopping is a little obscure, but it gives an indication of the portrayal of their more likely customers. More importantly, this research evidence amplifies the argument that corporate brands more entrenched in niches — like HaAretz, Arcaffe and Tiv Ta’am — are much less likely to be considered strong leading brands.

Thirdly, response to price and value perceptions are not free of an emotional loading. An economic approach views the calculation of value as a rational procedure of weighing the benefits and cost of a product or service offer. However, when an offer is judged as unfair to the disadvantage of the buyer, this may stir anger and resentment of the consumer in response to the price offer. The resentment is more often directed to the retailer, but it may be pointed towards the manufacturer of a national brand as well, depending on whom the consumer believes to be more responsible for a price differential or increase.

The judgement of unfair price differentials is contingent on the reference price used (e.g., a price paid by a friend for the same product at another store this week). In the case of a price increase, the reaction is subject to whether consumers can see justification to a price increase by attributing the increase in retail price to a rise in cost that retailers or manufacturers could not control (e.g., price of raw materials). In the past decade much resentment developed because consumers failed to find such justifications. Instead, the perception more accepted was that retailers and manufacturers were rolling their cost rises mostly to consumers, and they raised prices merely to improve their profits. In Israel this problem was evident especially in the food category where consumers were witnesses to continued feuds between the food chain retailers and manufacturers. More broadly, many Israeli consumers appear to these days to have little tolerance to retailers, service providers or manufacturers that seem to raise prices unfairly or try to position themselves to be more up-scale and luxurious — disappointment and anger at them motivates consumers to punish them in some way. This kind of resentment and urge to act in revenge is apparent also in the results of the study by TACK.

Price is given priority by more Israeli consumers, and it seems to overweight possible advantages in quality of products, services or the environment of shopping. In some cases consumers may fail to appreciate any such advantages while in others they simply consider the price premium as unjustified or unaffordable (which may add frustration to their evoked emotions). This can be another aspect that explains the differences between companies described above: (a) for instance, the gaps on Logic and Magic between coffee-house chains like Cofix and Aroma compared with Arcaffe,  and vis-à-vis Roladin, or (b) Rami Levi which is probably perceived as making greater effort to charge affordable prices (although it declined a little from last year), far better than a delicacy chain such as Tiv Ta’am. In other categories, it is more difficult to make clear inferences. In telecom services (mobile, TV, Internet), for example, all major companies receive relatively low appreciation and are less loved. A specialised dairy producer (Tara) is positioned less favourably than the two major and larger dairies (Tnuva and Strauss) which happened to be more shaken by consumer protests of several years ago (Tara is more preferred though among ages 55+ according to TACK). Among fashion retailers, a low-cost retailer of casual wear (Fox) is positioned just slightly higher on Logic but lower on Magic than some major main-stream retailers (H&M, Castro, Zara); yet another retailer (Renuar) that is probably somewhat more exclusive appears to be considered less worthwhile and having moderately less of magic (as reference, Polgat [for men], which has visibly better quality clothing, is not included).

The study of image strength by TACK sheds light on the relative positions in which consumers hold corporate brands both in their minds (Logic) and in their hearts (Magic).  It is somewhat surprising to find such a strong association between the logical-functional dimension and the affective dimension — it suggests that a company cannot sustain a positive stance on one dimension without the other for a long time. There is some discomfort also in realising that price could be more dominant than quality, but it is important to acknowledge how perceptions of value, and especially unfairness, can influence the emotional reaction of consumers to the corporate-level brands. Effectively, being attentive and sensitive to what the wider circles of consumers in the country need and expect to have is a key to be regarded overall as a favourable, strong leading brand.

Ron Ventura, Ph.D. (Marketing)


Comment on Methodology:

The brand scores are given in percentages. More detailed values reported for 2017 help to understand the metric’s structure. The score on each dimension (Logic or Magic) seems to be calculated as the sum of the ‘top-box’ proportions for the two items it is composed of (e.g., % who give a rating of 6 or 7 on a 7-point Likert-type scale in agreement with each statement of Logic, where 25% on ‘appreciate’ + 20% on ‘worthwhile’ = 45% on Logic). However, summing up those percentages is not a proper procedure — this sum does not have a meaningful interpretation because the proportions cannot be accumulated. It would be correct to take their mean rather than the sum. Another valid option is to add-up the rating values of the pair of items for each respondent and then calculate the percentage who have given a total score on that dimension of above a threshold (e.g., a score on the index of Logic of above 12) in order to produce a score that may be more easily related to.

Reference on price fairness:

The Price is Unfair! A Conceptual Framework of Price Fairness Perceptions; Lan Xia, Kent B. Monroe, & Jennifer L. Cox (2004); Journal of Marketing, 68 (October), pp. 1-15.

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The Rolling Stones most probably need no introduction. At least those born anytime between 1950 and 1980 should know the band, with Mick Jagger as its lead singer, and some of their widely known hits like (Can’t Get No) Satisfaction, Start me Up, Jumpin’ Jack Flash, and Paint It Black. By continuing to perform after the 1970s the band has given better chance for younger generations to become its fans as well. It is the longest acting rock band ever (since 1962, albeit some changes in their original line-up).

  • They are now four: Mick Jagger, Keith Richards, Charles Watts, and Ron Wood (the first two have written most of the band’s songs). Wood replaced (1975) Mike Taylor who has recently returned to perform with the band as a guest.

Therefore, when it was announced this spring that the Rolling Stones will have performed in a concert for the first time in Israel on 4 June 2014, the news were received with great excitement and anticipation. But then came a snag: the ticket prices declared were higher than Israeli rock fans apparently expected. The concert took place in the city park of Tel-Aviv in an area similar in form to an “amphitheatre”. There were three types of tickets. A small portion were allocated for standing on the lawn in a close area in front of the stage (“Golden Ring”), priced 1600 NIS (US$460) for a ticket. The vast majority of tickets allowed standing on the lawn stretching from behind the Golden Ring to the back slopes of the “amphitheatre”. Each ticket cost 700 NIS (US$200). Additional VIP tickets with extra perks offered sitting places on a staircase-balcony situated on the right-hand side, facing the stage, for the price of 2700 NIS (US$770). A total of 50,000 tickets were offered.

Rock fans have made mainly two types of complaints: (a) that tickets were more expensive than demanded for other concerts of foreign artists performing in Israel this year and in the past few years; (b) they were more expensive compared with prices charged in concerts of the Rolling Stones in other countries (e.g., 2012-2013 “50 & Counting” tour and the current 2014 “On Fire” tour).  Those price comparisons were used as a basis for consumers to claim that the ticket prices in Israel were unfair. The anger was directed towards both the local organizing agent and the Rolling Stones. Social activists ran a protest campaign in social media to persuade fans not to buy tickets. It most likely explains the sluggish progress of ticket sales until the day of the concert. All that time in the run-up to the concert there were talks that not enough people were buying tickets. Eventually, the amphitheatre was filled-up with 48,00o spectators, including the VIP balcony (a sigh of relief is permitted).

Consumers frequently judge the fairness or unfairness of a price in question based on comparisons to prices paid by others (e.g., friends), to prices paid by oneself on previous occasions, and to prices paid in other outlets for the same or similar products or services. Such comparisons are not easy to make, varying in accuracy and level of relevance. A key criterion for the relevance of a comparison is the degree of similarity between cases for which prices are compared — the more similar cases are on their non-price aspects while the prices are non-equitable, the judgement of unfairness is expected to be stronger.

  • When comparing with the prices for other rock or pop concerts consumers attended in the past, we should take into account factors such as: (1) the other artists used as reference; (2) when the other concerts took place (e.g., this year, three years ago); (3) the venue for the concert (e.g., a park, a football/basketball stadium, a concert hall). Further attributes extend from a difference in venue: seating or standing tickets, distance from stage, and flat versus rising ground or balcony. For example, standard tickets for standing in the same park at the concert of Paul McCartney cost 500 NIS, but that was five years ago. Niel Young, however, will be performing at that park later this summer, and standing tickets cost less than 400 NIS. In another case, Cliff Richard performed last year at Tel-Aviv basketball stadium: tickets for sitting on the flat floor of the basket field cost about 1000-1500 NIS while tickets in the first rows of the tier balcony facing the stage cost about 650 NIS. Arguing for unfairness is therefore not straightforward.
  • In comparisons to concerts of the Rolling Stones in other countries, differences associated with the venue of the concert are again important. In addition, one may also need to account for differences in standard-of-living and purchasing-power-parity (PPP) between countries. Fans in Israel, for instance, were angered that tickets in countries like the US or UK  where standard-of- living is higher than in Israel actually cost less when translated to shekels. Let us consider a few cases in example: (1) Ticket prices for concerts in Rome (22 June) and Paris (13 June) range from “standard” €78 (~US$110) to “premium” €150 (~US$210), nominally and relatively less expensive; (2) In the concert at Perth Arena in Australia, scheduled for 29 October this year, tickets for standing in the Tongue Pit adjacent to the stage or for seating in the flat area at the centre of the arena cost A$580 (~US$540) whereas tickets for sitting on the lower rows of the tier balconies more distant from the stage cost A$376 (~US$350) — while some place arrangements may be more convenient in Perth, overall the tickets are not less expensive than in Israel; (3) In fact, complaints about the relatively high prices the Rolling Stones charge have also been voiced in other countries — for instance, an article in The Telegraph criticised the high prices for the band’s concerts in London in November 2012 during their 50 & Counting tour (prices ranged between £95 and £375 [~US$150-600] with VIP Hospitality tickets priced £950! [~US$1520]), requiring the Rolling Stones to defend the prices they charge (Ron Wood explained they invested millions in arranging the stage).  Truly, there are not many active bands today like them.

In a cognitive, calculated decision process, according to the theory of mental accounting (Thaler), a consumer would evaluate the value to him or her of attending a rock concert based on some attributes or benefits of the band performing (e.g., how much the songs are liked, their singing and music-playing, and the show given at live concerts). Expressed in monetary terms, it is the highest price a consumer is willing to pay that would be equivalent to the psychological value to him (similar to the concept of reservation price in economic theory). The difference between the monetary value of equivalence and the (normal) price the consumer is asked to pay denotes the acquisition utility for the consumer.

  • The normal or ‘list’ price is often not the actual price paid due to special deals and discounts put forward — a difference between the normal price and the discounted actual price denotes the additional transaction utility a consumer can gain. For instance, customers of an Israeli mobile telecom company could buy their tickets for the Rolling Stones concert at prices 100 NIS lower than the official prices. (Some fans had a chance to buy standard tickets at half price of 350 NIS in a contest organised by the band.)

This methodic way for deriving a (perceived) value and reaching a decision may run out-of-order when trying to apply it to a rock or pop concert. Music as a form of art evokes emotions that are likely to disrupt sensible calculations of value. Moreover for devoted fans of a singer or a band, adoration and affective attachment are likely to influence their decision process more strongly. The fans of the band may find it difficult and disturbing to analyse their experience of listening to the music or attending a live concert in the way required to derive a well-founded value or utility. When the experience is about enjoyment, excitement, and getting carried-away by the music, the monetary value or the price fans are willing to pay can be expected to receive a boost upwards. They could perceive a reasonable acquisition utility even with the premium near-stage or VIP tickets.

But many other fans who feel close to rock and pop music, who may be greater fans of other artists of these genres, could also be strongly attracted to attend the concert because of the extraordinary opportunity to see and hear the Rolling Stones performing live in Tel-Aviv. Consumers may sense the historical significance of such an event, not to be missed. That could act as an emotional inducement for these fans to elevate the price they are willing to pay high enough to buy at least the standard type of ticket. It took until an hour before the concert to ascertain that there were indeed enough of them to fill the amphitheatre in the park (with some help from discounts).

Two important ways of approaching price were considered above: one is directed inwards and focuses on the perceived value of the target service, a rock concert; the other is directed outwards and compares the target price with prices for other cases or episodes that seem similar to the consumers and through which they judge the (un)fairness of the target price. Both avenues introduced challenging problems for the rock concert; it probably could have not occurred without the emotional component of the decision process. However, it does not have to spoil the event itself for those who bought tickets. Price may continue to pre-occupy the customers’ minds in the gap period between the time of buying the ticket and the day of the concert. When the event arrives customers “close” the mental account; they may either conclude the value obtained from their ticket acquisition or shift their attention fully to the event and the benefits it delivers, the more desirable way for them to avoid conflicts of value.

The concert of the Rolling Stones was wonderful. Mick Jagger was fantastically energetic on the stage (admirable in his age of 70+), and Keith Richards looked especially joyful. Jagger also demonstrated nice skills in expressing himself in Hebrew to the delight of the local audience. The band performed the songs mentioned above among others (19 in total); unfortunately Jagger did not sing their beautiful song Ruby Tuesday, but he performed another ballad from their repertoire not appearing regularely in their concerts, Angie.

  • Given the enthusiasm of the audience, the spectators did not let price issues spoil the celebration. There were other two factors that threatened to hinder the enjoyment. First, there was a heat wave that evening with high humidity — but that could not be anticipated and was beyond human control. It just had to be tolerated while drinking lots of water. The second factor was entirely due to human behaviour — spectators lifting smartphones above their heads in attempt to record on video episodes from the concert. The quality of images captured on the little screen (e.g., from a distance of 200m+) and the enjoyment spectators feel doing so is left for debate elsewhere. Meanwhile those screens waived above “stole” pieces from the field-of-view of the spectators behind who tried to escape them — what a shame.

The Rolling Stones did everything in their power, and they had the power, to make spectators happy for the money they had paid to the last shekel. Price did matter in making the decision to purchase and it even threatened to spoil the concert. However, that was true during the run-up period until the concert started on 4 June at 21:15. As the performance went on the spectators could easily forget about the price. The price effect was mitigated or vanished, leaving the spectators with pleasure of the music and performance of the Rolling Stones and particularly Mick Jagger. One may think of other artists who can achieve this outcome, but the Rolling Stones are definitely on the top list. It remains a specially good experience to remember.

Ron Ventura, Ph.D. (Marketing)

 

 

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That the music retail industry is in trouble is no secret. When we look, however, at what happened to major music store chains over the last five years it may become much clearer how serious the crisis is. Here are some highlights:

  • In 2007 Richard Branson decided time was up for Virgin‘s music Megastores and sold his chain of 125 stores in the UK and Ireland in a management-buy-out to a team of executives. The new retail brand Zavvi took place of the Virgin name that after thirty years vanished from High Street in the UK, particularly its famous flagships on Oxford Street and in Piccadilly Circus in London. By 2009 Virgin closed the last of its stores in the US. Stores in other countries were also closed while a few stores may still be found under the Virgin brand  in France, Greece, and in the Middle East. 
  • Zavvi survived no more than a year. It was dependent on a unit of Woolworths (Entertainment UK) as its primary supplier and with the collapse of the veteran retail chain, Zavvi ran into serious difficulties, forced into unfavourable new trade agreements. It entered administration in late November 2008 and within 3 months the chain ceased to exist. 14 of its stores were sold to HMV, 7 others and all stock sold to Head Entertainment, and all remaining stores were liquidated.
  • The once giant American music retailer Tower Records got into troubles already in 2004 when it sought bankruptcy protection and was doomed just two years later in 2006. Great American Group that bought the retailer in an auction soon declared its plan to shut down the music retail chain. All US stores were closed by the end of 2007 and in the following three years many stores overseas were sold or closed down. The stores in the UK closed in fact already in 2003 (Virgin took over its flagship in Piccadilly Circus but as noted above it did not last long).
  •  And now we hear that HMV is in trouble and struggling to keep its head above water. It is threatened by an increasing debt and a difficulty in keeping with terms of a bank loan. To be accurate, it is since January that news of troubles at HMV have been coming in about unsatisfactory sales results over the holidays shopping period and three consecutive warnings of dropping profits. First it announced plans for the UK and Ireland to close 40 music stores along with 20 book stores of Waterstone’s that HMV Group apparently also owns. Then it became known HMV intends to split Watesone’s from its core business in music, video, and games ; this prospect sale is still in negotiations. Analysts predict that break up is inevitable but still express concern that this will not be enough and HMV will be forced to close more stores to avoid administration.  

Explanations given by analysts for these misfortunes are probably not surprising many: the growing shift of consumers to digital download of music, video and games, and the tight competition from stores like supermarkets that sell discs at low-cost. While retailers started offering their merchandise online on their websites several years ago they were quite unprepared for the trend of digital download.

As implied above the problem is centered on but not limited to music. More than ten years ago music chain stores have actually transformed into entertainment media stores in order to expand their business and not be reliant only on music. Yet, the retailers could not cope with the fast technological developments in this field during the years 2000s that altered consumer behaviour patterns. This is not just about low price but also convenience, flexibility of choice and immediacy. True, especially in the early Internet years but even nowadays items can be obtained for free on the net and this phenomenon poses problems for many in the industry, perhaps mostly to the artists. This issue is complex with legal ramifications beyond the scope of this article-post. However, the whole field encompassing the different types of entertainment media has progressed considerably and broadened in the past five years and it would be too simplistic to attribute it squarely to price.

Music stores should not be given up too quickly. There are certain things about the stores — the sights of loaded stands of products, colours and sounds, movement on the floor and buzz — that the Internet and various electronic devices cannot provide. Many private stores, small or niche stores, may still remain but the chain stores were the real engine of this retail industry. It is worth investing much more effort to create a new model for music or entertainment media stores that will retain some of their more traditional virtues in new forms and yet offer new benefits. I suggest two dimensions for development in which strong advantages can be created: personal customization and social interaction. These can be sources for strong shopping values and enjoyment.

Personal Customization

Consumers want to choose more freely their favourite songs and create their own song compilations. They are much less willing to wait for record companies to produce albums and compilations based on their judgements. Consumers are less tolerant towards albums that contain 2-4 really good songs and 8-10 mediocre ones. The choice has to be delegated more extensively to the consumers. This phenomenon is becoming stronger and wider.

Perhaps as some analysts claim there is less justification for the large space of stores we have known so far. Stores may restructure and re-allocate floor space between product displays and personal self-service stations. A shopper will be invited to sit on a stool in front of a flat screen at his eye-level and use a multimedia programme to search and scan the store’s wide selection of music pieces as well as films, TV series episodes or games and choose whatever he or she likes. When the shopper completes, for example, to create a song compilation to his/her taste, an instruction will be given to the computer system to burn it on a CD, DVD, Blue-Ray disc or alternatively be saved on some other memory device such as Disk-on-Key. Appropriate payment arrangements may be devised including advance deposits and pay-as-you-collect at the cashier or pay with credit card at the station. Sessions may be limited in time.

Why doing this at the store and not at home? First, it may be because of powerful utilities of the multimedia programme that makes the shopping experience smoother and more enjoyable — well-designed graphic displays of items planned with consumer search behaviour in mind and friendly tools for building and displaying at any time the content of the shopper’s basket. The display may incorporate information structures such as a matrix or table of a relatively large variety of items , a “ribbon” mounted across the screen (moved left and right) for quick scan in a narrowed-down set of items, or “wheels” that include possibly artists in an inner tier and song pieces in an outer tier. Second, the programme may allow playing songs or showing short samples from film in live-streaming directly from the store’s library (if the system works on an Intranet it may work faster than on the Internet). Third, when required the shopper may consult with a personnel adviser, assuming hopefully that the store employs people expert in various genres of entertainment.

It should be remembered, however, that there are different types of shoppers. We may distinguish primarily between (a) those who come with a more clear and well-defined plan of specific songs, artists, TV programmes etc. that they wish to find and buy, and (b) “explorers” who have a more general idea, perhaps only at the level of a style or genre, of what they want and whom in the “old days” liked to browse through items on display with their fingers. For consumers who do not have well established preferences and who even seek surprising discoveries the old format was simpler and easier to explore and probably less time-consuming compared with a computer application. A multimedia programme with a search engine may be less advantageous for them. In order not to lose those customers the store will have to devise more creative solutions, combining intelligent computer-based cues and guiding tools, physical displays even if more limited than before, and human advice.

Notwithstanding, there are types of music pieces and areas in which it should be sensible to offer physical copies on display. For instance stores can continue to offer films, live concerts,  TV series by season, and games as ready-made products. In addition, areas like jazz and classical music should still deserve special rooms with most space allocated to displays of physical items to accommodate usually more conservative habits of amateurs of these types of music.

Social Interaction

Consumers of entertainment of sorts, especially younger ones (say under 30), prefer to sit in front of the computer at the comfort of their homes, sometimes for hours, surf the network for various music and video pieces. They also like to download pieces onto portable devices such as MP3 players, smartphones and tablet computers. But they do not truly perform this activity all alone. Conspicuously as they sit on their own with the computer they often communicate with friends and relatives, consulting and change ideas or recommendations talking on the phone or chatting in social media communities.

So why not offer these consumers a more lively social way to interact with friends face-to-face  in a store? For that purpose, special sitting sets for 2-4 people can be installed in special areas of the store (not to disturb other customers). At the set a small group of customers-friends can sit together, use each his or her multimedia application to explore and examine favourite pieces while from time to time conversing with each other on their findings. This setting offers people a more natural, direct and open way of socializing, and it has a good chance of producing richer shopping baskets.

These are two directions for developing a new model for music or entertainment media stores that I conceive as promising from a consumer perspective. More generally and beyond the proposed directions, stores will have to create benefits that enrich the whole experience of shoppers during their visit and that the Internet and personal electronic devices (i.e., for online sales and digital download) cannot in their capacity replace (e.g., contact with expert staff, events, sensual stimuli in the store’s scene).  For stores’ owners and managers, the goal is clearly to convert shoppers into happy customers who enjoy returning frequently to the store(s).

Ron Ventura, Ph.D. (Marketing)

Media Sources:

“Branson sells Virgin Music Stores”, BBC News, 17 Sept., 2007

“Zavvi placed into administration”, BBC News, 24 Dec. 2008

“Tower Records victim of iPod era”, Associated Press at MSN Money, 10 Oct. 2006

“HMV prepares for split to stem rising debt“, Financial Times FT.com, 28 March 2011

“HMV in its third profit warning of this year”, The Guardian (online), 5 Apr. 2011

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