Magazine article Marketing

Can Net Music Help Sell Your Products?

Magazine article Marketing

Can Net Music Help Sell Your Products?

Article excerpt

MP3 is creating new opportunities for sales promotion.

MP3: three characters that have shaken the music industry to its core. For a few, MP3 signifies Motion Picture Experts Group Audio Layer 3, a compression format that reduces computer audio files to a fraction of their original size. For most, MP3 is a byword for free music available in abundance on the internet.

Last year, it overtook 'sex' as the most searched-for word on the web. But digital distribution of music over the internet also offers huge promotional opportunities, both within the music industry and in the wider, wired marketplace.

The success of sites such as MP3.com and Vitaminic have shown some of the possibilities of digital audio promotions. These sites offer free sample tracks to download as an encouragement for people to buy further download tracks or specially-produced CDs, thereby circumventing the thorny issue of security.

"We're not competing against the major labels, we're just providing a platform for musicians," says Nick Field, Vitaminic's head of marketing. "It's up to the artists and labels what they want to sell. Security is important, but we suggest they use the free facility as a sales promotion tool. By offering free tracks in return for e-mail addresses, more people are likely to enjoy the music and ultimately purchase it, and artists and labels can build communities of listeners."

Hardly an appealing offer

The established music industry has not been as quick to exploit digital delivery of music as the internet startups. EMI was one of the first major labels to dip its toe into the digital distribution waters, but the 100 albums offered for download through retailers' web sites such as HMV.com since July are priced the same as retail CDs. With long download times and no tangible product, few consumers are going to find the offer tempting.

Meanwhile, the Recording Industry Association of America (RIAA) has waged a vigorous campaign against those associated with the dissemination of pirate MP3 files, such as the controversial Napster web site. With ongoing legal warfare, few music promoters -- let alone brand managers -- have been willing to enter into the digital music arena.

There are, however, signs the situation may be stabilising. The internet's biggest music service provider, MP3.com, came under fire from the music industry when it launched My.MP3.com, which allows users to access a massive database of copyrighted MP3 files if they can prove they own the original CD.

Yet, after months of legal wrangling, EMI entered into a non-exclusive licensing deal with MIP3.com, in which royalties are paid for every download. Other majors quickly followed suit. "EMI's internet strategy is to create innovative, convenient and attractive ways for fans to access their favourite artists' music," says Jay Samit, senior vice-president of new media at EMI. "This settlement ensures that copyright owners and creators are compensated fairly."

A desire for secure technology

Copyright security is the key to the success of digital music. And the drive for protection has led to the establishment of the Secure Digital Music Initiative (SDMI) forum, comprising over 180 companies from the worlds of IT, consumer electronics and the recording industry. The SDMI has a remit to develop a secure technology to protect the playing, storing and distributing of digital music, with a view to developing the market.

One member of the SDMI is Magex, a digital commerce company set up by Nat West, which offers the sort of service that could finally see digital music becoming a viable sales promotion tool.

"The music is provided in what we call a digibox," explains Caroline Homer, Magex's head of brand and communications. "One of the main benefits is that the business rules are associated with the digibox itself; wherever the box goes, the rules go. I can potentially have the box with three free plays, after which I pay for the track. …

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