Increase in users, decrease in sales = good for p2p and SN

rVibe logoA very interesting article about the Myth of the active buyer.  The active buyer theory says that while there will be decreasing number of buyers (of music), those who do buy, buy a lot more – and save the industry.  According to this research, the opposite is true – more buyers, all buying less. Which to me makes a lot of sense. More people aware and engaged, but not buying.

If this news doesn’t tell you that it’s important to offer more services than straight download to keep users sticky, and if it doesn’t tell you that more users/less purchase means you have to lower operational infrastructure costs, nothing will.

To me this speaks volumes about retail strategy. You have to have greater ubiquity, non-sales value added services and lower cost to maintain your service in order to be viable. You also have to offer a better mechanism to drive up sales.

And no, I am not just seeing this news through our strategy, it just reveals the value of our company.

Posted on September 13, 2007 in Management

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