The future of content: quality or quantity?

24

October

2016

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In digital marketing, the emphasis for a long time strategy now has been on quality, rather than quantity. However, since information technology provides new ways of providing content, it becomes easier and cheaper to focus on quantity and to provide more content. Therefore, the future of content might be focusing on more content.

This will not be the case because it has worked for a couple of famous sites just as The Post, but also because content will take a wider range of forms, as for instance: High volume content strategies, automated content, short form content and video content. As a result, the accessibility of publishing tools will also improve, making it easier to create and publish content.

To elaborate more on high volume content strategies, this success relies on the long tail theory. This originated in e-commerce and is the theory that collectively, the demand for a large number of niche products, can exceed the collective demand for a small number of popular or bestselling products. Using the long tail theory, The Post (for instance) is creating thousands of niche articles, which each attract modest traffic, rather creating fewer, big content articles, as collectively the niche articles deliver more traffic overall.

Furthermore, the cost of content production is falling because of the approved internet technology, even as distribution cost are very low, enabling more content to be produced. At the moment we are seeing a high volume approach being taken by many established B2B sites and influencers. Tools are also constantly developing, which will help many people mote to producing higher volumes of content.

Do you think there is still a future for content quantity? Or do you think the volume of content will be lower in the end? Will the long tail theory still be an essential part of the future of content?

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Long tail theory vs. superstar economy

24

October

2016

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Technological utopians have been predicting for years that the internet will weaken the dominance of superstar artists in the music industry and enrich the teeming masses of smaller, niche creators. But new research suggests that this ‘long tail’ theory is wrong: superstars are capturing the vast majority of music revenues and their share is increasing because of the rise of digital services like iTunes and Spotify.

What is interesting is that a relatively niche group of engaged music listeners have most interest in discovering as diverse a range of music as possible. Most mainstream consumers want leading by the hand to the very top slither of music catalogue. This is why radio has held its own for so long and why curated and programmed music services are so important for engaging the masses with digital.

It is right that the falling cost of distribution has made more music available to consumers than ever before: most digital music services have catalogues of more than 20m tracks. However most of those tracks go unheard. The ‘long tail’ is very thin and anemic compared to the ‘fad head’.

Using data compiled from record labels, distributors, artists, managers and music services, they found that the ‘superstar economy’ is even more extreme in digital services than it is in physical stores. This is partly down to the nature of digital devices, as a digital store or service has a home page that often has to squeeze onto a few square inches of smartphone screen while a high street store has dozens of square feet of window space.

What do you think about the long tail theory in the music industry? Will new ways of sharing and discovering music online could yet inject more life into the ‘long tail’ or will most consumers stick to the mainstream and is music going to remain a superstar economy?

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Digital Transformation Project – Julia’s Pasta Transformation -Group 6

23

October

2016

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We started our digital transformation project by understanding the frustration of customers of Julia’s: long waiting times. During our research we developed a suggested solution for this problem.

Firstly, we examined the internal and external environment of Julia’s. Here we found that the competitive advantage of Julia’s lies in the handmade, authentic and healthy food they provide, but the average waiting times are quite high when comparing them to other options to have dinner at railway stations.

One of the important goals of Julia’s is that the preparation of a pasta should not take more than four minutes. Taking into account this important goal we defined four key success factors (KSF). We defined the key success factors as punctuality (KSF 1), consequent quality of products (KSF 2), customer satisfaction (KSF 3) and distinguish from competition (KSF 4).

First of all, the investment in the application will turn profitable if an increase in customers is achieved. The pasta bars of Julia’s have to change the organization within each bar so that there is a fast and convenient way to pick up the online ordered food by the users of the application.

Long waiting lines will disappear as customers are now able to pre-order their meal so that they do not have to wait in line. By reducing the waiting time, the punctuality will be higher. Julia’s will provide handmade, fresh and authentic fast food, which will grow their competitive advantage and distinguish from competitors by being fast and offer a decent, warm and healthy meal. Finally, the reduced waiting time and the guaranteed quality of products will lead to a high customer satisfaction what leads to more sales of products and makes the investment profitable.

A limitation of the application could lie in the problem that customers are not on time for picking up their meal, caused by a delay of the train. To prevent this problem, we would suggest to implement the Julia’s online ordering application into the NS application, as the NS application provides information regarding all of the train delays. This information could help to see the delays coming and would prevent the food from being too long in the heating system. Another limitation of the application could be that there is not enough capacity at the Julia’s pasta bars. We suggest to reorganize the pasta bars to become more efficient and larger to ensure all of the demand of customers. 

In the end we could say that the online ordering application would turn out to be a profitable investment and we therefore suggest to implement the application as soon as possible. We also would like to mention the possibility to implement the application within all the formulas of NS retail when the application works smoothly and when the customer satisfaction will increase.    

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Technology Of The Week – Music (Streaming) Industry – Group 6

16

September

2016

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The music industry has been disrupted by IT advances. We used to listen to music on mp3-players and nowadays we stream music and listen to music everywhere we are. The music industry became a newly vulnerable market.  This market was newly easy to enter through technological changes, a drop in costs and through the ease of spreading music online. It was a cheap small step to streaming services. Furthermore, the industry was attractive to attack because of the high fixed costs the record companies had to cover. Record companies made it difficult to defend themselves, because the companies did not compete with the new online distribution strategies, which left them far behind in the market.

We analysed Deezer and Plugify to get a better understanding of the disruption in the music industry. Deezer is an independent online music streaming provider, has 6 million subscribers and is available in 180 countries. Deezer operates as a multi-sided platform business model. One segment finances the other segment. The user is looking for music, while the advertiser is looking for an audience to advertise their products. Deezer focuses on a long tail strategy. Because there are no stocking costs online, Deezer could provide an unlimited amount of songs, what means all niche tastes can be served. Also the lower costs of making music support the niche market. Plugify is an online platform to book live music. The customer searches for a desired artist and can book and pay online. The business model of Plugify consists of two key players, the customers and the artists.

When we look at the comparison between Deezer and Plugify, we see that Plugify has a first mover advantage in their field and that Deezer faces a lot of competitors who supply similar services to their customers. For Plugify the power of supply is high as they need as much artists as possible and they only operate in the Dutch market. The power of supply for Deezer is low. There are only a few artists who refuse to deliver their music. The power of buyers of Plugify is high as customers can easily find artist online. The power of buyers of Deezer is low, because Deezer has a large customer base also due to their partnerships with telecom companies. Besides, when a customer has to pay for their account, they often don’t want to leave. For Plugify there is a high threath of new entry in comparison to Deezer where this is low, because the market is already dominated. The revenue model of Plugify consists of a 8-12% commission per booking as Deezer focuses on subscription fees and advertisement income. The cost structure of Plugify and Deezer is quite the same.

In the future there will also be changes in the music industry.  Artists will earn money through performances instead of selling music. There will be more music experience through virtual reality, more music personalisation and sharing music through social media channels will become easier. And of course music streaming will become mainstream.

By:

373396 Florine Koot

365545 Christianne ‘t Hart

376005 Elisabeth Kuyf

376482 Emilia Mertens

References:

Retrieved 14 september 2016, from http://opim.wharton.upenn.edu/~clemons/files/JMIS-.Online_MusicV3_doc.pdf

Plugify (2016) Retrieved 14 september 2016, from http://www.emerce.nl/interviews/plugify-online-bands-boeken-fluitje-cent.

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