Servitisation and value co-production in the UK music industry

Abstract

Since the rise of music on the internet, record companies have reported falling sales of physical products. This has occurred at a time when technology has radically increased choice, availability and the opportunity for the consumer to purchase music. As the music industry has moved from a product to a service business model, has the loss of sales meant they have not taken their customers with them? This paper provides a description of different music consumers based upon quantitative analysis of consumer characteristics. The paper then undertakes an exploration of the relationship between the consumer groups and their purchasing preference in relation to intangible ‘service’ purchase such as downloaded music and the purchase of a tangible physical product such as CDs or vinyl. In addition, we analyse the relationship between consumer types and their propensity to actively engage with music communities, such as through engagement with social media, and thus their willingness to coproduce greater value. Finally we explore the moderating effects of age and time devoted to listening to music on purchasing preferences and music discovery