Global and Domestic Marketing Decisions
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Global and Domestic Marketing Decisions
Of course, its tempting to think of business decisions as occurring in a perfect economic bubble–wouldnt it be nice to simply prepare a strategic SWOT (strengths, weaknesses, opportunities, and threats) analysis based on ones industry alone? Alas–or fortunately, depending on ones perspective, however, no company exists within such a comfortable bubble in todays business environment. (SWOT Analysis, 2004) Today, companies must keep abreast of the profound technical, cultural, and ethical shifts that have occurred in todays business climate, reflecting the more forward-thinking yet bearish attitude climate of the 21st century, as opposed to the 1990s.
Technology
From a technological point of view, the Internet has changed global and domestic commerce. In particular, cultural industries such as the music industry have been impacted. No longer can music companies simply bank on the popularity of an individual artist. Nor can music and entertainment companies ignore the dangers of Internet piracy. Instead, they must make legal downloads affordable, exciting, profitable to the entertainer, and yet also attractive to the consumer.
To make use of the technology of the Internet, and to circumvent pirating and copyright infringements that will bankrupt individual artists (and ultimately the industry), international Virgin entertainment mogul Sir Richard Branson recently started a new music store, VirginDigital.com, selling music as streams of bits to be downloaded from the Internet. Virgin, a unit of the Virgin Group, became “the first major music retailer to enter the download market,” which had before been dominated by Apple and Microsoft. (Hansell, 2004)
Virgin is putting its biggest emphasis on its subscription service, rather than on selling songs one at time for 99 cents a track, like Apple or Microsoft, because it is “betting that new customers will join its Virgin Music Club for a $7.99 monthly fee to listen to an unlimited amount of music from Virgins one-million-track library on their computers, and providing a premier fee option for subscribers who are willing to pay more to transfer the music to their iPods and M3P players. Virgin has done so to keep up not only with current music trends and intellectual property law but also in growing recognition that the line between entertainment and computer technology in consumers minds and reality is increasingly becoming blurred across the world, and business must respond to these trends. (Hansell, 2004)
Culture
Now, we must pause for some words of wisdom from our sponsorwell, not really…but increasingly, the culture of web surfing, blogging, and the ubiquity of internet marketing has encouraged marketers to use the Internet as a way of purveying their goods. “Advertisers poured a record sum of money into the Internet last quarter, which may help explain why Web pages are starting to resemble Nascar jerseys.” However the culture of online advertising is not a perfect marketing parallel with traditional advertising. Advertising and marketing segmentation in the Internet reflects a culture that is both more segmented, customized, and also more international in its scope.
Unlike billboards or magazine advertising, Web pages are not purely regional in orientation. Specific types of individuals with more specific interests surf specific pages–but unlike highway drivers, they come from all over the world rather than from a specific region, with a specific destination. Unlike national televised advertising, consumers can be more specifically segmented and targeted–and they are reading and clicking, in control of the experience, rather than switching something on or off. Rather than driving by, if interested, they may stop and peruse for a while.
Marketers still wish to reach a broad audience, however, perhaps “one of the big draws was so-called search advertising, those advertisements that appear with the results of an online search. About 40 percent of all ad spending was for search ads, an increase