music industry strategy and business models report

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TRACKITDOWN: THE ONLINE DANCE MUSIC COMMUNITY 1.EXCECUTIVE SUMMARY This report analyzes the challenges and opportunities for the music industry within electronic marketplaces, statistical data highlight that the online sales in the UK alone will reach £78bn a year by 2010 (Econsultancy, 2009). The marketing endeavors have to be directed to the effective online promotion of music and keep in regard issues of design, security copyright management. Furthermore the Internet interactivity and customizability peculiarities have affected the communication model toward the emission of targeted and personalized contents. In this scenario the music business encourage the proliferation of niche markets based SMEs that focus on the satisfaction of their market segment with a comprehensive service inclusive of music and side products. Through the examination of the business model developed and implemented by the e-commerce music, merchandising and technological equipment website 'www.Trackitdown.net', this research aims to critically evaluate the best practice in the strategic management of the online music business. 2.INTRODUCTION 'Producers can pick up on consumer trends, repackage them and sell them back to paying costumers' (Bilton, 2007 p.152). This report aims at critically investigating the business model deployed by the online service www.Trackitdown.net. This online retailer for dance music and associate products has cleverly mirrored its segment market, as states the above 1

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This report analyzes the challenges and opportunities for the music industry within electronic marketplaces, statistical data highlight that the online sales in the UK alone will reach £78bn a year by 2010 (Econsultancy, 2009). The marketing endeavors have to be directed to the effective online promotion of music and keep in regard issues of design, security copyright management. Furthermore the Internet interactivity and customizability peculiarities have affected the communication model towards the emission of targeted and personalized contents. In this scenario the music business encourage the proliferation of niche markets based SMEs that focus on the satisfaction of their market segment with a comprehensive service inclusive of music and side products. Through the examination of the business model developed and implemented by the e-commerce music, merchandising and technological equipment website 'www.Trackitdown.net', this research aims to critically evaluate the best practice in the strategic management of the online music business.

TRANSCRIPT

TRACKITDOWN: THE ONLINE DANCE MUSIC COMMUNITY

1.EXCECUTIVE SUMMARY

This report analyzes the challenges and opportunities for the music industry within

electronic marketplaces, statistical data highlight that the online sales in the UK alone

will reach £78bn a year by 2010 (Econsultancy, 2009). The marketing endeavors

have to be directed to the effective online promotion of music and keep in regard

issues of design, security copyright management. Furthermore the Internet

interactivity and customizability peculiarities have affected the communication model

toward the emission of targeted and personalized contents. In this scenario the music

business encourage the proliferation of niche markets based SMEs that focus on the

satisfaction of their market segment with a comprehensive service inclusive of music

and side products. Through the examination of the business model developed and

implemented by the e-commerce music, merchandising and technological equipment

website 'www.Trackitdown.net', this research aims to critically evaluate the best

practice in the strategic management of the online music business.

2.INTRODUCTION

'Producers can pick up on consumer trends, repackage them and sell them back to

paying costumers' (Bilton, 2007 p.152).

This report aims at critically investigating the business model deployed by the online

service www.Trackitdown.net. This online retailer for dance music and associate

products has cleverly mirrored its segment market, as states the above quotation, to

satisfy its needs and build up long-term commitment and bond of trust with

consumers (Chaffey et al, 2009). The Trackitdown director described the website as

a community where DJs and fans find the electronic music sub- gender they prefer,

the technological kit to play the tracks, the merchandising and the news related to the

dance background. The exploration of the website products and services will be

expounded throughout the company communication and revenue strategy. Thus will

be explored the contemporary opportunities and challenges the music industry is

facing after the electronic marketplaces blown up and capsized the established major

label control (Graham et al, 2004). The realization of a complete and factual analysis

of the case study implies the exploration of economical, marketing, technological,

design and legal matters. According to Chaffey (2009) generating an e- business

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strategy means blending the traditional marketing, business and supply chain

management with the information system peculiarities. The study will keep in regard

the matter of fact of that the Internet is a consumer-generated medium (Jenkins and

Deuze, 2008). Websites are developed with CSS (Cascade styling sheets)

technology: 'style sheet language that allows authors and users to attach style to

structured documents' as asserts the word web consortium (www.w3.org). The

feasibility of customization changed the media communication standard, the users

are no longer passive receiver of the media content (push strategy) but they are

empowered to find information (pull strategy) (Hutchinson, 2006), and manipulate the

contents (Pelsmacker, 2010).

The online commerce has to grant security and data encryption in the transactional

phase, stated by the Distance selling Regulation

(www.berr.gov.uk/Policies/consumer-issues/buying-and-selling/distance-selling). In

addition, the sale of music implies the safeguard of intellectual property and

copyrights of the wide choice of tracks on the website archive (England and Finney,

2007). While providing all these components, the online service has to build up an

effective structure in which consumer can easily and effectively find and complete

tasks (Rubin, 2008). This exploration of the convergence of different fields of studies

in an unique business strategy will refer both to the academic and industry literature,

and will be supported by the direct evidence emerged from the declarations of the

director of the company (see Appendix 1).

2. OVERVIEW:

2.1 Trackitdown Backstory

The original idea of Trackitdown project dates back at the end of 90's, when the

company partners were DJs performing dance music mixes around UK music clubs.

They witnessed the at that time cutting edge, CD mix technology put side by side to

the traditional turntable plats. The music was still just sold in vinyl, but producers and

DJs were using digital technology to compose and easily restyle and remix tracks.

The professional dance music community started a massive interchange of CD with

their creations, the production of tracks increased while the clubbing culture was

taking over, also thanks to this huge network of artists (Leyshon et al, 2005). The

basic idea of the Trackitdown founders has been to adapt the iTunes electronic

delivery model to the dance music background.

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2.2 The online music shop

The core product (Chaffey et al, 2009) of the website is the music download. The

featured music player follow the user in the exploration of the variegate dance music

genres, enabling the track preview and the creation of the play list to enjoy while

reading or commenting the news of the sphere, the updated artist profiles or just

checking out who's ranking in the chart. This is the Trackitdown atmosphere. As we

can deduce from the prior events, the music product online shop has essentially

been designed for the insiders, DJs and producers can easily find material for their

performances and they are supported by the secure download and the continue

upload of new tracks within the catalogue. The ulterior music genres diversification

characterizes the intent to engage the client through an accurate segmentation

according to users taste (Mintzberg et al, 2002).

The business action plan entails the 'affiliate programme', Trackitdown allows other

websites to present either all the music catalogue or select a part of it. Trough the

EDI (electronic data interchange) technology, a communication protocol and

standard for the data interchange among computer, the host website access to the

patron music database and can store it 'behind' its interface thanks to the CSS

technology. In this manner, the consumers don't feel redirected to another website

during the purchase phase. This forethought endorses the consistency of navigation,

a core trait of web usability (Sdl, 2010). The enterprise runs stores for Mixmax: the

online dance information service (http://mixmax.co.uk/), Kiss Fm: am online radio and

TV (vwww.totalkiss.com), and Dogsonacid: a Drum n' Bass massive online

community (www.dogsonacid.com).

The benefits of the cooperative sub contraction form (Graham et al, 2004) are

noticeable: extension of the business, prestige acquisition within the business

contextual relationships (Mintzberg et al, 2002) and also lower transaction costs and

less pricing competition (Laudon and Traver, 2009). Those advantages require high

standard commitment from Trackitdown in the management of the chain of suppliers,

both in the contractual phase and in the long- term venture, in fact even the minimal

variation of the website structure could affect the affiliates operative (Reymond,

2005).

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2.3 Technological apparatus component

The website session dedicated to the sale of DJ equipment demonstrate the

company intent to maximize the value of the customer experience with the deep

knowledge of its costumer segment of the dance music niche market. The contents

segmentation practice 'allows the marketers to more efficiently direct the business

market effort (Bloc and Bloc, 2005) and affirm the online branding strategy of the

company (Ryan and Jones, 2009). The expertise demonstrate with the selling of

such dedicated and specific products corroborate the engagement of the company in

creating a bond of trust with the costumes, by providing them a complete service

within a customizable and consistent experience (Chaffey et al, 2009).

2.4 Merchandising

According to the opinion of Trackitdown director, the fans still prefer the CD as format

for buying music. The business patronizes every year the DJ Mag (www.djmag.com/)

top 100 DJ project, obtaining a 35.000 fans database with their votes, and therefore

taste and trends. The merchandising is a valuable ploy to monetize on the 'additional

features beyond the core product' (Chaffey et al, 2009, p. 451) and in this particular

framework represent the successful endeavor of the firm to broaden the audience

throughout the insertion of tailored products configured around the customer

proposition values (Pelsmaker, 2010; Preckumar, 2003). This branch of the trade is

successful, according the report of Trackitdown director, and a promotion tool

recently realized (May the 11th, 2010) supports the merchandising branch: a link to

the featured product of the track played on the music player.

3. CURRENT ISSUES AND PREFORMANCE

3.1 Building the online reputation

The electronic marketplace is an exciting field in which marketers are challenged to

contemporarily broaden the audience while narrowing the focus on the

individualization and customizability of the products (Ryan and Jones, 2009). The pull

interactive medium allows a direct and personalized dialogue with users (Nicholas

and Stokes, 2006). The users, on the other side have the power to manipulate the

reputation of the brand trough the world of 'click': the online version of the traditional

word of mouth and grassroots marketing (Hutchinson, 2006). These denotations date

back to Nicholas Negroponte (1995), who predicted the potential of the Internet users

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to effectively pull in the medium ideas and contents instead of merely absorbing the

information flow propel by traditional media.

The challenge is the unpredictability of the users response (Jenkins, 2006):

marketers have to be proactive in renewing and evolving their strategies (Mintzberg

et al, 2002) in order to identify, anticipate and satisfy the audience needs (Caffey et

al, 2009 p.416). The Trackitdown tackle this process by providing various levels of

personalization; the company director states: 'We offer the opportunity to be part of

the community of Trackitdown, rather than someone that just download the music

and doesn't get involved'. With the creation of their online Trackitdown profile, users

not only access the purchase of tracks and goods, they can actually leave their

feedback or comments and choose a personalized newsletter service. The final goal

of this customized e- mails is the consumer retention, they facilitates the company

task to focus on the audience personal interests, and enhances the engagement with

the community (Pelsmacker, 2010).

The Trackitdown newsletter service is effective: not invasive and delivered on regular

basis, provide the user a shortlist of 'what's new' in the community within the

previously selected sub- areas. The interactive opportunity to filter the email

configurations convey trough the storage of the details furnished by the user in

databases, which are also valid tools for further analysis within the market segment

(Chaffey, 2009). In addition to these customizable services the website launches

periodical competitions; as well as all the tactics performed in the digital marketing

strategy, they are tailored for the Trackitdown audience. The business director

explains the market segment 'How sites work and how people feel about them largely

depends on whom you are selling to [...]. We are selling most to 18-30 years old:

they're very computer savvy, they know how the Internet works; they write music:

they know how to use the technology. But they are also very passionate about the

product...' (see Appendix 1).

3.2 Social networks: friends or foe?

Another powerful and controversial e- communication strategy is the usage of social

networks. The phenomenon is in its exponential expansion from the last few years,

they revolutionize the approach to the web, entitling the publication of photos, rich

media, text and music in a structured network of peer-to-peer contacts. Thanks to

their popularity those websites have become a powerful channel for the e-marketing

strategy. The creation of the brand profile on those websites is a largely diffused

practice in the contemporary industry scenario and opens a wide range of

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opportunities. Those channels are the viral marketing forge: the public can interact

with the brands trough their favourite network, and exchange opinions with their

friends: (Kaplan and Haenlein, 2010). Becoming 'fan of a brand', reports E-marketer

on 02 April 2009, is a leading-edge strategy: according to Insite Consulting research,

35% of respondents has 'followed' a brand online (www.emarketer.com).

Furthermore, '64% of consumers report making a first purchase from a brand

because of a digital experience' (Schmitt, 2009).

Social media, along with the traditional channels of return of investment (ROI)

measurement, give the combination of the platform specific metrics with the

reputation monitoring tools (Econsultancy, 2009).

In addition, marketers can directly grab the audience exchange and gain the direct

feedback on their opinions (Ryan and Jones, 2009), reach and envision the impact of

early adopters (Advertising Age, 2010). The usage of social networks in a promotion

campaign, require the continuous commitment of the brand in the direct interaction

with the users and at the same time they increase competitions between similar

enterprises. The opinion of the audience can rank or destroy the online reputation of

a brand with just one click.

The Trackitdown approach to those social conglomerates is smartly aware of their

double-sided power, and their actions are targeted to en effective and cutting edge

service. First of all the 'benchmarking' of the sector they continuously update, plays

high attention on the ever-changing popularity of tools and channels. High dedication

is given to the currently most powerful and popular channel: considered that 16% of

Trackitdown downstream traffic is generated via Facebook

(http://www.alexa.com/siteinfo/Trackitdown.net), a member of the company is

dedicated only to the management of the profile of the community. They also have

developed an application dedicated to Facebook, the device is the adaption of the

music player available on the patron website, this ploy reinforce the branding

awareness of the costumer and ease the audience stream towards the commercial

online zone (Schmitt, 2009). Facebook provides also the immediate measurement of

the outcome of the application, on the 12th May 2010 the instruments has 11901

users, while Trackitdown Facebook fan page counts on 10329 followers

(www.facebook.com).

3.3 Services Upgrade

Online since the 28th of January 2004 Trackitdown can be considered an established

business within the 'young online marketplace', they are a powerful hybrid between

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emerging and mature industries. They are moving within an environment created by

technological and sociological recent breakthroughs. it is interesting to see how they

reached the grade of experience in which research and dynamic stability combine the

best of mass customization and continuous improvements aimed to the long- term

customer bond (Mintzberg et al, 2002). The Trackitdown e-crm (electronic customer

relationship management (Chaffey et al, 2009) is positioned towards the continuous

implementation of tools and communication facilities. The attention of the in- house

development team is addressed to the needs of their customer database and to the

stakeholders’ collaborative partnership (Miles et al, 2005). Working in relation to the

effective marketing segmentation, the organisation makes use of online surveys for

the analysis of the Strengths, Weakness, Opportunities and Threatens (SWAT

analysis), in order to improve their service while maximizing the business marketing

efforts (Chaffey, 2009). The survey is planned in a way that identifies the consumers

'awareness, preference or intention to consider or purchase', its questions focus on

variables that measure not only the statistic data but keep in regard the psychological

influences of human response to the marketing strategy (Block and Block, 2005). The

online questionnaire recently proposed to the audience included the investigation on

the awareness of the features and their effectiveness. The scope was to verify the

consumer response to a tool or a website session and establish the subsequent

pattern (see Appendix 1).

The next implementation planned by the company, consequent to the data analysis,

is the online sale of the tickets of dance music live events. The feature will allow

clubs and promotes to add their events on the website and to link the sale of the

ticket with the music preview and purchasing. The ploy is meant to broaden both the

connection with fans and strengthen the company network within the professional

dance scenario. Besides, the professionals will share the ROI (Return of Investment)

of this effective tool of promotion with Trackitdown (Ryan and Jones, 2009).

3.4 Business to business trust approach: copyright guarantee

The business model based on the charge of the music downloading proposed by

Trackitdown is an effective response to the piracy issue, each track on the website is

protected by mechanical rights. However, in order to meet the music producers and

DJs needs, they are not subjected to the DRM (Digital Right Management)

restrictions: once purchased the track can be played, performed and edited.

Furthermore the tracks are available both in wave and in mp3, to fulfill all the possible

uses the file will be allocated and therefore meeting all the dance DJS and music

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producers’ requirements. According to Premkumar (2003) the reorganization of the

supply chain after the impact of illegal peer-to-peer downloading, implies a deeper

understanding of customers’ needs, and the education of the public on copyrights.

This standpoint is reinforced by the research conducted by Sandulli and Barbero

(2007), in which they remark that the ethical issues related to illegal download are

advertised as harmful for the economy and the artistic production, while previously

was promoted the opposite perspective. The authors, in addition analyze the

differences between peer-to-peer sharing and Legal Digital Music Providers. The first

difference they present is the better reproduction quality in legal stores (Sandulli and

Barbero, 2007); Trackitdown guarantee the quality of the files by dealing directly with

the record labels. The company, is planning to offer an additional royalty

management service to the record labels they store by protecting and monitoring all

the links related to each track available on the website (see Appendix 1). The other

difference, which is also an advantage of Legal Digital Music Providers versus pirate

downloads is the trustworthiness: peer- to- peer downloading entail connection

hurdles, and, above all, 'many P2P systems are highly vulnerable to pollution attacks,

in which attackers target specific content and inject corrupted versions of it into the

system' (Sandulli and Barbero, 2007, p.68). Users are aware of the danger; therefore

the tendency is to address their attention to a charged but secure service, taking

advantage of (Meisel and Sullivan, 2002; Shultze et al, 2004).

3.5 Multiple, easy and secure transactions

Secure online transactions in UK are guarantee by the Data Protection Act of 1998.

The necessity of regulation in the subject stewed from the rapid diffusion of

computers in 1970s, which implied the increased speed and quantity of data

operations (Carey, 2000). The compliance with electronic commerce law within the

personal and financial data processing and storage operations guarantees the

trustworthiness of the online transactional operations (Bart et Al, 2005). The

technology that undertakes the protection of data storage and transmission is the

encryption, a procedure throughout textual data are converted in 'cipher text' that

cannot be read by anyone other than the sender and the receiver' (Laudon and

Traver, 2009). In addition to the security of transactions and personal data

manipulation, Trackitdown offers different currencies and payment systems to ease

the process and facilitate the customer retention (Chaffey et al, 2009).

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3.6 Navigation and color schemes: creating a smooth and captivating design

The planning of a user- centered design is a core issue, in fact 'commerce sites can

influence their impression of trustworthiness by carefully designing their site to avoid

amateurishness, set and meet reasonable user expectations, trust and usability'

(www.phisophe.com). Usability 'refers to how well users can learn and use a product

to achieve their goals and how satisfied they are with that process.”

(http://www.usability.gov/basics/index.html). Statistical results remark that the 82% of

customers is less likely to return to a website, if its design lacks in the application of

usability essentials (Econsultancy, 2009).

The first step for a website intuitively usable is a well-organized web architecture, that

structures contents and information in a coherent search optimization taxonomy, and

communicates the overall site organization (White, 2010). Then, the architecture has

to be supported with a correct and transparent linking strategy, 'if the customer can't

find a product, then he or she will not buy it' (Nielsen, 2002, p ). Furthermore, the

description of the product should inform the consumer on the information necessary

to make the purchase. In addition, the checkouts page has to set the transactional

phases clearly, and comprehensive of data protection details.

The speed of page load is an ulterior guarantee of mastery and affordability, which

will drive to customers’ satisfaction and retention (Nielsen, 2002).

The Alexa online analysis reports the Trackitdown average load time as 'Very Slow

(7.883 Seconds), 94% of sites are faster' (www.alexa.com). Also Nielsen (2002),

recommended 4 seconds as the maximum webpage loading time.

Working on the loading time issue should be a task designated in the action plan of

the company, since it encompasses the whole design and the quality of the service in

terms of applications and graphics definition (www.philosophe.com). However, the

overall website content, is effectively delivered, and matched with the target audience

computer literacy, taste, scopes and inclinations.

The contemporary creative challenge of web designers is to apply the universal

principles of web usability and web design, and shape them after the exploration of

the cultural background they are targeting, as stated by Lupton (in Armstrong, 2009)

'we are developing our particular voices as people - as men and women, as

members of a generation, as participants in local communities and institutions, but

also practitioners of a global design discourse (Armstrong, 2009).

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In this framework the choice of color scheme is essential: the influence of colors on

human perception is outstanding to cultural and physical patterns of associations. In

the web design context, the color selection affects the responsiveness of the

customers to the communication strategy (www.colormatters.com). The Trackitdown

color configuration appears appealing, in particular the selection of the 'hot pink' for

the music session. Pink is normally associate with the female sphere, while the

audience of the website is predominately male. Historically, the pink had a different

connotation, as a derivate of red it was associated with power and activity, hence

masculine. In addition, the color has often been associated with good fortune and

liberality (www.colormatters.com). These historical and cultural connotations could

have subconsciously leaded the team in the selection of this color; they are all men,

after all.

CONCLUSIONS AND RECOMMENDATIONS:

This case study presented music business incorporated in the framework of

electronic commerce and promotion, the experience of the company examined

consented and effective and complete exploration of the matters in question. The

core nodes of the online strategy are the continuous updating of contents and service

in order to mirror the clients expectations and create with them long time commitment

and willingness to purchase and making positive reviews. The marketers’ ability to

cluster and follow the continuous evolutions of demands is triggered and constantly

challenged by the interactive power of consumers; therefore a good practice is a

flexible and coherent strategic approach of CRM (Bilton, 2007). Trackitdown

orientation reflects this perspective and offers a complete online dance music

experience, their efforts are well targeted to the creation of an enduring bond of trust

with new and affectionate costumers. The brand evolution could address the

endeavours in the promptness of page loading, which seems to be the weak spot in

the valuable content delivery.

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APPENDIX 1

Interview with Nolan Shadbot, Trackitdown Director

Friday, 19th March 2010

Q: How did you come up with the idea of the virtual dance music and associate

products store and community?

A: At the end of the 90's in the clubs there were both the vinyl players, but also the

CD players, the thing was that you could not buy music on a CD, just on a records.

We (Nolan is a former DJ, the Trackitdown staff includes DJs) were sending files to

each other, music producers were sending us mp3s of tracks they had written, and

then we put them on CDs and played them. And I said 'this is crazy, why don't we

just sell all these files...' and then Itunes came along and start doing it for pop music

and we decided to do it for dance music. That's why our slogan is 'Time to burn'.

Q: Trackitdown offers to the customers a complete branding around music: su-

genres, Dj kit, merchandising, info and news. The target audience is well defined:

expert, professional. Do you plan to widen you audience maybe with more synergies

with other industries branches or by promoting side areas of entertainment: clubbing

or live performances?

A: The merchandising is really an effort to target more the clubbers, rather than just

the DJs: there are far more people in front of the decks, dancing on the dancefloor,

so that's why we have all the t- shirts. Typically the fan don't like to buy digital

products, so if they want to buy an album they would still much rather have the CD

than buying the download, so every year we sponsor a big project for the Dj Mag Top

100 and we receive about 35000 votes from around the world from fans who are

voting for their favourites DJs, we've go to this enormous database of fans, so we

need to find more products to sell for them. So we are planning to introduce ticketing

in the near future, clubs and promoters will be able to add their events to the site, and

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all the music will be linked trough it, so fans can listen to the artist and also buy the

tickets for their gigs.

Q: The online promotion of Trackitdown works with the sharing, linking to social

media: Facebook app, Twitter profile...Is a good tactic to involve and attract more

audience? Which of these tools is generating the best feedback?

A: Facebook, Facebook, Facebook! We have a member of the staff dedicated to

Facebook, we don't care for Myspace anymore, and it’s dead. Everything we do is

99% Facebook and 1% Twitter, because Twitter is so quick and easy to do, but we

really invest a lot of time and energy in to Facebook. I think 10% of our traffic comes

via Facebook, it is a network of information exchange and it's free, without paying

anything extra we can reach anyone within this space. Teenagers probably are

spending more time on Facebook than watching TV; I read that communication via

Facebook email has overtaken actual email, which is incredible. This tendency will

probably continue for the next two or three years, but, as I always said to people

when Myspace was massive you would never believe that a new site will come

along, somebody could arrive with a new crazy idea that just seem to work and

people will get interested in that, so we wait and see. We heavily focus on what's

going on between other social networks.

Q: The website membership includes a wide range of possible customizations and

facilities to find tunes. What has been your strategy to get this high quality service

together with the bond of trust with consumers in the transactions? And are there

more features in program?

A: Yes, we are building a brand new application. Sometimes people buy 200 tracks in

one order, or an album that has 50 tracks, with this application you click just one to

complete the order. We are generally developing new features all day every day, we

have two in house team members, and one who's out in Canada, who does the

graphical interfaces. We work on the site everyday we see all the pitfalls and

improvements needed. Also the email from the fans, ask us for new features or

changes, and when we can we do that. Building new features is always exciting but

is also very difficult, because our website now is so huge that even making a small

change somewhere actually affects a lot of things. We also have the affiliate system,

so we run stores for other websites, so when we make a change on our store, we

have to consider how it impacts on their stores. We have a set of standardized set of

tools, so a part from the ticket selling for the moment we are not adding anything

else.

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Q: Describing Trackitdown design in terms of web usability, what is your philosophy

in terms of the choice of tools, session and colours?

A: This is actually our second revision, before it looked completely different: dark

background, the colours were blue, black and grey. It was 2006 when we changed it,

I had an album out and its cover had white pink, gray and black on it and we thought

looked fantastic, so that's how we chose our colours. Because they were nice, simple

and fresh colours, but the pink had some kind of jazz taste, that gave us soft feel,

easy on the eye and land. The merchandise session is white, yellow and gray; the Dj

kit has green. We previously have a game session; it all was black, with blue, instead

of pink. We really liked that, and I'm still tempted to change the whole website again,

but is quite difficult when you get this level, costumers expect a certain thing. Is very

important to choose the colour scheme and layout. Some people prefer to shop with

us purely because we are a better looking website. It's all about building tools and

interfaces that people can use: packaging is very important, the better a site looks,

the more people will like it.

Q: You mentioned a game session...

A: It just ended: it wasn't very popular. When were building it we were doing a

customer survey at the moment, and we asked with which platform people played

games. Most people played on their computers, according to our survey, but our

game session just weren’t very popular; it didn’t sold enough to work out. We are

trying to focus on what we know well and it is dance music. The merchandising is

working so well, even if we don't know anything about making t- shirts.

Q: What do you think is the orientation of the music industry in terms of copyrights,

patents, DRM, moral rights?

A: I think that all of that is pretty much over now, I think it's pointless to try to stop

piracy by applying DRM: it doesn't work, it frustrates the people that are paying to

being legal. A still major problem is with government legislations are trying to make

the Internet providers to chop people off when they are caught three times

downloading illegal files. We are introducing a new service, which is called

'Trackitdown protect' where we will actually represent record labels and protect their

copyrights online. On a title-by-title basis, we will ensure that any link to the file online

for the legal download. We have relations with all of the major hosting such as Rapid

Share, so this is another service we provide to labels to help control the amount of

piracy that is the main issue. Going back to DRM the problem are computer crashes

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and all your licenses stop to work when you reload your hard drive. Especially in the

dance music perspective, once you purchased the file you probably want to edit it

within a sound editor, to enable you to manipulate your DJ performances, you

definably want to put on CD on Ipod...so being flexible with the format is what is

required. And DRM didn't allow people to be flexible. I think an effective business

against piracy is offering a better service to the customers. If it's cheap, easy and

safe to buy they're happy. If they are downloading illegally, they don't know if they are

getting a virus, so it's very important to buy music cheaply, safely and conveniently.

We offer the opportunity to be part of the community of Trackitdown, rather than

someone that just download the music and doesn't get involved and doesn't have the

features or the news.

Q: Could you explain the affiliate program more in detail?

A: The affiliate program runs from 2005, it allows any other website to present either

the hole of our catalogue or selected parts of it. So, if a record label website has a lot

of traffic, they can put our store's data but it will look like their website. People don't

think to be sent somewhere else. We run stores for Mix Max, for Kiss FM; we

probably have five major earning stores at the moment, and they are pretty much

communities for specific styles of music, so the main could be Dogsonacid, that is a

Drum'n'Bass website, they have an incredible traffic, a massive blog. For the users

it's easier to buy the music from that website, the host website also makes money

and helps Dogsonacid to provide music to their community.

Q: So Drum'n'Bass is still huge?

A: Yes, massive: it's bigger now than in the last couple of years, it had a couple of

years being quite, now it's returning. We are really strong in Drum'n'Bass, my

business partner is a hardcore fan, and we sell a lot of it.

Q: How would you describe your working philosophy?

A: Well, essentially my job is to understand how people work, how they shop and feel

about things. Just like we talked about the colour scheme of the website, I have to

understand how people are going to think about the pink. It is a girlie colour, and

maybe they see it in different way...or if they are going to understand ho the layout

works. When we build a product, we know how it works, because we built it, bur

when we give it to our customers, it may be very complicated to use. We have to

show them the best way to use it. We are doing a customer survey and some

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questions sound like 'do you know about this feature?' or 'are you following us on

Twitter or Facebook?' and it's amazing how someone use the website either every

day or every week but don't know about its features. For us those are great

information, because we know where we need improvements, how we can help the

users understand all the features and make their shopping easier. I used to say

content is king, now I say content is important, but, the costumer need to know how

to find the content and how to navigate them. How sites work and how people feel

about them largely depends on whom you are selling to; how invested they are in the

product you are selling. We are selling most to 18-30 years old: they're very

computer savvy, they know how the Internet works, they write music: they know how

to use the technology. But they are also very passionate about the product that we

sell, sometimes in a positive way, sometimes in a negative way, for example some

people like only specific Techno, and if the session has other kind of Techno in it,

they don't want it. They only want what they think is the best, and so we have to

design system to enable them to find just what they want.

Q: Yes, Hardcore Techno I know there's a lot of people crazy for this kind...

A: I was a huge fan too, when I was younger...(laughs)

Q: It's too hard for me. Ok, I'm done with questions, thank you...

A: You're more than welcome. Anytime.

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