The document summarizes the current market environment facing New Zealand music retailer Real Groovy. Real Groovy has strengths in its large catalog of over 28,000 titles and product specialization, but weaknesses in its small size with only four stores and inability to control the rise of digital music downloads. The threat of digital downloads reducing CD sales could significantly impact Real Groovy's profits if it does not diversify into other markets. The recommendation is for Real Groovy to diversify its product offerings to become less reliant on CD sales.
