Comparison between hmv and itunes stores

Comparison between hmv and itunes injectsIntroductionIn the past 10 old age the internet or e- engineering science has altered how the industries operate. More affected by the young engineering science is the medicine and video manufacturing later the book industry with eBooks. Tradition anyy consumers have purchased medicament, video or a book from a store. If it is a unison or a video it is bought on CD / DVD and but with the internet came new elbow rooms of draw and quarterting digital satisfy. Apple has launched ITunes for bringing of digital field of study directly to the consumer, with no somatogenic presence.HMV is using a mixed strategy of maintain a carnal store as rise as having a website for dish outing the digital circumscribe but the delivery is by representation of shipment of CD/ DVDs.They both operate under the same model B2C. But they have incompatible ways of delivering the goods / services to customer.HMVHMV is the UK and Irelands leading speci alist retailer of medication, DVD/Video, electronic computer Games and Related Products. The comp some(prenominal) operates around 200 stores in key obtain locations nationwide, equating to over 1million sq. ft. of trading space, as well as a successful online store at www.hmv.co.uk, operated by HMV Guernsey1. HMV merchandises means in strong-arm from and operates in physical as well as virtual space.ITunes farm animalThe iTunes Store is a softw argon-based online digital media store operated by Apple Inc. enterprise as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase it was as of April 2008 the cast-one music vendor in the United States. As of January 2009, the store has interchange 6 billion metrical compositions, accounting for 70% of worldwide online digital music deals and devising the service the largest legal music retailer. As of family 2009 the sales of ITunes are 8.5 billion songs, 1+ million HD movies and TV episodes, 2 billion apps with a combines revenue of $ 6.7 Billion 2 .ITunes sells digital content and has virtual presence only.SWOT AnalysisHMVStrengths* Has both online and physical store presence. Customer basis regain forevery of the 2 ways to interact with HMV.* Can sell any item MUSIC/ DVD/ GAMES, no motif for any arrangement with HMV.* Can deliver physical items interchangeable romp consoles, posters/ r exclusivelyy etc.Weakness* Can non sell individual items in music albums or individual episodes in TV shows.* Not accessible all the while (except online, which requires shipping of ware)OpportunityThe opportunity for stores lies in enhancing the customer experience at the stores. terrorThe physical stores are fast losing substance the rivals resembling Zavvi, Woolworths have closed roughly of their physical stores. Becoming obsolescent is the threat faced by the stores of HMV.Itunes Strengths* Suits the unavoidably of the current generation.* Content is like a shot available f or consumption.* Available anytime and anyplace.* It is backed by one of the best companies in the tech world, Apple. Weakness* Can sell only the products like music that it has been agreement with companies and is authorized to sell.* Cannot sell and deliver online physical items like posters/ separate etc.* Cannot sell items that are huge in size in terms of memory. Games DVDs are usually of a size of 4 Giga Bytes or more(prenominal) and are difficult to download online.* Not available in all the countries.OpportunityThe opportunities lie in expanding into another(prenominal)wise segments of digital content like eBooks. The Ibooks which is a past of iStore is planning to sell eBooks directly to the customer.ThreatThe model of ITunes is easily replicable. The threat is from rivals like Amazon and HMV who want to sell digital music to sell directly to customers same way as ITunes does now.SLEPT AnalysisBefore creating any line of reasoning strategy or eon evaluating an existin g strategy it is extremely all important(p) to s buns the external environment. SLEPT epitome is an investigation of the Social, Legal, Economic, semipolitical, and Technological influences on a business3. Social The changing human ecology of the people leave behind have an impact on the business. The social changes tail end be psychological, demographical etc. The psychological change that is witnessed is the need for making things take chances fast. People do not want to require for placing an range and postponement to receive it by post. Most of the music albums have one or two hot songs and todays consumers are not willing to pay for the intact album. They want to pay only for the songs they like.LegalSince the advent of new technology the music industry has been losing its revenue. The illegal file sharing has eaten into the revenues of music companies. Music companies have been suing the file sharing sites like Napster and more recently the piratebay. even off the i ndividuals are sued by the industry Recording Industry Association of the States (RIAA) has successfully sued a Minnesota woman for copy right attack and illegal file sharing4. Legal battles resulted in debauch of digital content by the consumers. The legal issues lead to the online stores like ITunes that sell music lawfully online.Legal structure is well in place to support the business of ITunes and HMV. Economical Economy and business cycles affect the business. We are in the inwardness of an economic recession. Customers will be counting every penny they spend. The most the costs associated with dealing a company the more the customers shy external from that company.HMV The costs associated with purchasing content from HMV are far more compared to buying music from iTunes. Customer needs to visit a store, browse through a variety of catalogues before zeroing on the music / video to buy. This involves time and travel cost.ITunes customer push aside access iTunes by sittin g in their homes. Carry the music with them in an iPod. Buying a single song instead of buying an entire album is always cheaper.Political Political changes are related to the influence that government has upon the industry. The political changes usually do not affect much the entertainment industry. In rare cases the governments may feel that some music / video content may be decided to be inappropriate for their country or will ail the sentiments of the people. They ban the particular content from distribution and delivery.TechnologicalIf there is any singular factor that changed the dynamics of an music industry, it is technology. With the ubiquitous internet, people are able to share digital content freely, which includes music, videos etc. engineering science too facilitated the illegal copying and distribution of music and video. Technology also deintermetized the content delivery. As the music is directly delivered to the consumers there is no need for the manufacturers o r suppliers of CDs/ DVDs. Technology made it possible to carry the content with us in our IPods, Laptops, Phone etc.Digital content everywhere and on any device is the MANTRA of technology. Companies that fast adapt to this tsunami of technology changes survive while others perish.BCG intercellular substanceBoston Consulting Group (BCG) MATRIX is developed by BRUCE HENDERSON of the BOSTON CONSULTING assort IN THE EARLY 1970s.According to this technique, businesses or products are classified as low or high performers depending upon their market result rate and congenator market shareITunesGrowth The Itunes is the undisputed star in the BCG hyaloplasm . Between 2000 and 2009 the population using internet has become 1.7 billion from 360 million5. tall internet users mean high growth potential for the itunes.Cashflows Itunes revenues are steadily increasing every year. Strategy The strategy to be adopted for stars is to take up or invest for growth. Apple is investing in ITunes store by adding app store, which sells games and applications for mobile and computers. With the launch of Ipad Apple is adding the fastest developing segment , eBooks to iTunes , handicraft it as iBook store as a part of Itunes. HMVGrowth The growth of the HMV stores has been moderate and better. The augment in sales also partly callable to the demise of its closest rivals like Zavvi , Woolworths6. Cashflows The hard cash flows for the physical stores are unassailable but not exactly encouraging. The online stores sales are increasing, hmv.com grew by 16% and waterstones.com grew by a phenomenal 60%7. Strategy The recommended strategy is to possess or add market share. The company is losing sales as well as sales in the physical stores domain but is growing in the online space. That is why HMV is launching its own delivery of music and other content through direct download from its own website. Shopping stimulateThe shopping experience is diametrically different for both HM V and itunesHMVCustomer has 2 ways of interacting with HMV. A physical store visit and through online at the website of HMV for purchasing content. its own web site, which operates a sales model of e business. Customer plunder walk into the HMV stores, touch and feel the products and buy them. This is indispensable especially while buying products like card and posters. They can sample assistance from the store assistants, whenever they need it. When a customer visits the website www.hmv.com he can buy CDs that are delivered to him by post. When a customer buys any product directly from the store he can use it immediately, but when consistent online using the stores, he needs to wait till he receives the product by post to start using the product. The payment methods are cash or card for physical store payments and only through cards for online payment. ITunesTo be a part of ITunes customers need the following1. A computer2. Access to Internet3. Download iTunes parcel4. Have reference book / debit card5. Error free internet connection.Customers are connected virtually. Customers can search the item they are looking for in no time. Customers can buy the item and start using them immediately, no need to wait for any shipment to arrive. The payment method is only through cards and NO CASH payments. Pricing of goodsHMV The pricing of goods is entirely dependent on the content (CD/ DVD) that customer is going to buy. Music is interchange through albums and the damage is fixed per album. The individual items in a Music album or individual episodes in a TV show are not available for purchase. ITunesThe items are sold as bundled products like albums or sold separately as individual items. For example a customer wanting(p) to buy music has an option of buying the complete album or individual songs in the album. Return ProceduresHMVThe return policy is dependent on the kind of product purchased. Unwanted, damaged and incorrect or faulty items can be returned t o HMV and customer can get a refund or get a damaged item replaced.ITunesWhen shopping with the iTunes Store, all sales are final. The customer needs to decide what are the items he wishes to buy and add them to the shopping cart. As soon as he clicks the acquire button, the purchases are charged to his account. The money is taken from his debit or credit card account. Once the order is placed there is no way a customer can cancel the order or get a refund.It is the responsibility of the customer to check for compatibility of the items purchased.Type of technology for websiteHMVThe technology used by the HMV is * A browser interface for content viewing, no need to for any software (like iTunes). Anyone can view the content with the tending of popular browsers like IE, Firefox or Chrome.* Order acceptance via website. No user account needed for buying items from HMV.com* Handles acknowledgement of payment and shipment delivery details for the orderITunesThe technology used by ITu nes is Apple proprietary. Items are not sold through a web browser interface like other ecommerce sites. Anyone wanting to access ITunes need to download the software from APPLE and all the actions are through the software.The ITunes comprises of* An interface for viewing the music/ video catalogs* An order processing system via iTunes account and credit card/ debit card* A delivery system via download from iTunes.ITunes restricts the sale of digital content to those people who are not having iTunes software.HMV and ITunes and E-Business LadderTechnology has changed the way the business happens. E-business is any process that a business transcription conducts over computer-mediated network channels. Business organizations include any for-profit, governmental, or non-profit entity. Examples of these processes are on-line purchasing, on-line sales, on-line logistics, customer support, employee training and recruiting, and vendor-managed inventory, production founding and control 8. The e business ladder is the ladder that shows where the organization stands with repute to what is possible to achieve in terms of available technology. The ladder shows how effectively the organization is using the advantage of technology and has integrated with business strategy. We will see where HMV and ITunes stand with respect to e -business ladder model of lake herring e-Adoption Ladder (DTI, 2000)HMV needs to move up the ladder to compete with Itunes. HMV is making moves towards this. HMV is adding another business dimension to its website www.hmv.com. The new delivery channel is by means of downloads directly from the website of HMV. This is currently under construction and will be available soon9. Which means HMV is moving up the ladder from just fetching orders online and processing them offline to accepting orders and delivering through internet.ITunes is at the top of the ladder. It has tie ups with all leading content providers (music production companies, TV stud ios, movie producers etc). The customers just need to visit iTunes store to buy any content. This is a seamless integration of suppliers and buyers by iTunes acting as a intermediary facilitating B2C transactions.Emerging Technologies in e-businessThe emerging technologies that can be used for e-business are * taint computer science* Mobile cypher.ITunes has already made inroads into mobile computing by fling iTunes in its iphone. But iTunes is available only for iPhones. HMV can use the other platforms for mobile computing like Android from Google, Windows Mobile from Microsoft for building applications to sell content on mobiles.Cloud computing is the area that both iTunes and HMV needs to explore. The current business model is delivering the content to the customer by means of download or physical delivery of CD/DVD.Apple restricts the number of machines that can play the content that is downloaded from iTunes. We cannot play the content on more than 5 machines and those machi nes need to be authorized using the users iTunes account. With cloud computing the content is not necessarily delivered but it can be accessed from anywhere when connected to internet. A customer who buys a music album or songs need not download it to his computer but can access from anywhere and from any computer or any device, say , mobile.Cloud computing is possible only when the connectivity is always established with internet, which is not insurmountable in near future.How can HMV and ITunes increase market shareHMV 1. show growth in the existing websites which is possible by new offerings like making downloads available2. Introducing new product range like interchange e readers and new gaming hardware like DSI3. Introducing loyalty cards.4. inviolable tie up and product sharing with group company Waterstones for interchange books and eBooks.5. Live ticketing , HMV wants to sell tickets for events of the artists along with albums.6. Starting Pay to Play gaming centers as the new gaming fever catches up across all age groups for games like Call of Duty.ITunes1. Make it accessible to more people, via browser interface.2. Make eBooks available3. Remove the restrictions on the usage of the content bought from iTunes. endingThere are valuable lessons to be learnt from the strategy and models adopted by HMV and ITunes. Companies need to be aware of the forces that affect their business including competitors, customers, technology, suppliers, and at clock most importantly new entrants into the market. The ITunes has once again proved that, the how ever dominant is the firm in the market it is never safe. Companies must be aware of the technological circumstances that surround the business in order to be on the cutting edge of new developments in the market. refreshed entrants must also be aware of the technology that can deed over them the advantage over firms that are already dominating the market. Disintermediation is one important way that firms can use technology to streamline production and increase profits. And most importantly, a firm must never become self-satisfied they must always be on the lookout for new markets in which to expand.Referenceshttp//hmv.com/hmvweb/navigate.do?pPageID=1083http//en.wikipedia.org/wiki/ITunes_Storehttp//www.thetimes100.co.uk/theory/theoryslept-analysis235.phphttp//www.linuxinsider.com/story/business/69220.html?wlc=1264844838http//www.internetworldstats.com/stats.htmhttp//www.moneyweek.com/news-and-charts/company-news/rivals-demise-boosts-hmv-100114-0729-31157.aspx www.hmv.comwww.census.gov/econ/estats/papers/digitalecon.pdfhttp//hmv.com/hmvweb/navigate.do?pPageID=1530