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By Jenna Morris Management Consultant
[object Object],[object Object],Real Groovy’s  current situation
 
Despite Real Groovy’s enormous trade in: 1. 2. 3.
The company has experienced… A sales drop.
Factors such as…
DOWNLOADING MUSIC; Legally And illegally
Heavy Competition;
And a Declining economy;
All contributed to Real Groovy’s  sales drop.
Let us at these factors a little more closely…
FACTOR 1:  Digital Music Downloads
2001 $200 Million 2006 $147 Million Total music sales fell from, to
…  CD’s have become a  ‘clumsy’ way to package songs  in the digital age. ALSO:
e.g. Option 1: 1 C.D = 20 Songs 1 x 80 gb iPod = 20,000 Songs
Main Idea: The physical increasingly cannot compete with the digital.
FACTOR 2:  Economy
After its parent company  collapsed  in late 2007…
‘ Sounds’ (the nation’s largest music retailer at the time) shut its doors… … owing creditors almost $20 million.
‘ Sounds’ blamed a  weak  retail market   and illegal  downloading from the  internet after its recent  closure.
FACTOR 3:  Heavy Competition
 
JB HI-FI has increased profits by 50% during 2004 to 2006…
…  a time where all the major music labels admitted they had  ‘taken a hit’ in their financial reports.
It is  not  all bad news!
Real Groovy  set themselves apart  through: “ nooks, crannies and systems management”, and competing on range, not on price.
LOOKING AHEAD… On an international scale, the Virgin megastore spokesman  believes that: “ If music was available only as downloadable material, it would be the  beginning of the end  for the music industry…”
“…  after all,  The Darkness  aren’t likely to be appearing in-store to sign their  latest downloaded album  anytime soon.”
Real Groovy needs to  implement an achievable and clear strategy  of how the company is going to  respond  to its current situation.
Recommendations for Real Groovy Using the Boston Consulting Group Tool, (The BCG Matrix) sort out what is working in the business and what is not working . Implement a Growth Strategy. This involves organisational expansion. Continue to set themselves apart from other companies in the music industry.

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Information Management 191, Assignment (1)

  • 1. By Jenna Morris Management Consultant
  • 2.
  • 3.  
  • 4. Despite Real Groovy’s enormous trade in: 1. 2. 3.
  • 5. The company has experienced… A sales drop.
  • 9. And a Declining economy;
  • 10. All contributed to Real Groovy’s sales drop.
  • 11. Let us at these factors a little more closely…
  • 12. FACTOR 1: Digital Music Downloads
  • 13. 2001 $200 Million 2006 $147 Million Total music sales fell from, to
  • 14. … CD’s have become a ‘clumsy’ way to package songs in the digital age. ALSO:
  • 15. e.g. Option 1: 1 C.D = 20 Songs 1 x 80 gb iPod = 20,000 Songs
  • 16. Main Idea: The physical increasingly cannot compete with the digital.
  • 17. FACTOR 2: Economy
  • 18. After its parent company collapsed in late 2007…
  • 19. ‘ Sounds’ (the nation’s largest music retailer at the time) shut its doors… … owing creditors almost $20 million.
  • 20. ‘ Sounds’ blamed a weak retail market and illegal downloading from the internet after its recent closure.
  • 21. FACTOR 3: Heavy Competition
  • 22.  
  • 23. JB HI-FI has increased profits by 50% during 2004 to 2006…
  • 24. … a time where all the major music labels admitted they had ‘taken a hit’ in their financial reports.
  • 25. It is not all bad news!
  • 26. Real Groovy set themselves apart through: “ nooks, crannies and systems management”, and competing on range, not on price.
  • 27. LOOKING AHEAD… On an international scale, the Virgin megastore spokesman believes that: “ If music was available only as downloadable material, it would be the beginning of the end for the music industry…”
  • 28. “… after all, The Darkness aren’t likely to be appearing in-store to sign their latest downloaded album anytime soon.”
  • 29. Real Groovy needs to implement an achievable and clear strategy of how the company is going to respond to its current situation.
  • 30. Recommendations for Real Groovy Using the Boston Consulting Group Tool, (The BCG Matrix) sort out what is working in the business and what is not working . Implement a Growth Strategy. This involves organisational expansion. Continue to set themselves apart from other companies in the music industry.