How Napster Competes with Traditional and Online Providers

“Electronic Marketing Insight” assignment

Read the Re-launch of Napster case study on p.301-304. On, one page:

Evaluate how Napster has varied each element of the marketing mix to compete with traditional and online music retailers.

Product: Napter’s core product was free music downloads offering consumers free peer-to-peer music sharing services, competing with other peer-to-peer services such as Gntella, Grokster an Kazaa. However as a result of legal action, Napster’s core product became online music subscriptions and permanent music downloads, competing with competitors such as Spotify, Last.fm and iTunes. Napster also resells hardware to end-users to store and replay their music. Furthermore Napster can be seen as an extended product of Dell consumer’s laptops and desktops, this can be compared to iTunes being a extended product of Apple products. Napster would have a greater opportunity to further expand into other brand compared to iTunes, as iTunes is owned by Apple. Napster’s product also varies with traditional music retailers in that it is more a service than a physical product, e.g. a CD sold by traditional music retailers such as Look & Listen and Musica.

Price: One of Napsters main characteristics was that it was free. Now subscribers need to pay a subscription fee in advance to be able to listen to music or they need to pay additional costs to own it. Prepaid cards are also available through retail partners. Napster’ price can be seen as less expensive compared to traditional music retailers, as consumers only pay a subscription or additional cost per track compared to traditional music retailers where a whole CD has to be bought. Other costs such as mental and emotional cost for consumers to go to a physical location such as a shopping mall is also decreased . Compared to other online music retailers such as iTunes, Napster can also be seen as less expensive, as people need to purchase Apple hardware to be able to use it.

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