Professional Documents
Culture Documents
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1.0 BACKGROUND TO THE STUDY
1.1 Introduction
The music recording industry offers new trading opportunities for Ghana. In the age
of knowledge-based international competitiveness, services are assuming a greater
share of output of all economies. Though regarded as an informal sector, the music
recording industry in Ghana represents a vibrant and dynamic sector of the Ghanaian
economy. (Collins, 2001).A Webactive (2004) report reckons that the global music
industry generates annual global sales of $38 billion. Mathews (2001b) suggests that
while spending on US online music was only $836 million in the year 2000, about 5.5
percent of the total revenue in the music market, it is projected to increase to $5.36
billion by the year 2005, representing 25 percent of the market. The industry is
dominated by five major record labels namely:EMI, Sony, Universal-Vivendi, Time
Warner and Bertelsmann BMG who control the market for recorded music in terms of
both production and distribution (Webactive 2004).The ability of the major labels to
control the supply chain for music has prevented artists from independently
distributing their own material.
The Internet, by making possible online distribution of music, has disrupted the
normal way of conducting business in the music industry and promises to
fundamentally alter the law, the economics, and the power relationships governing the
industry. Internet marketing is heralded as the new paradigm of marketing
incorporating deliverable benefits as multiple marketing usage, access to commercial
research, competitive intelligence, customer service, just-in-time inventory planning,
sales channel knowledge, support for channel partners, image enhancement, rapid
growth, global reach, around-the-clock presence, ability to target marketing efforts,
cost effectiveness, up-to-the-minute information, and multimedia. Internet marketing
is driven by the escalating, ever-changing needs of customers seeking better services
and products. Berezai (2000) suggests that the growth in consumer use of the internet,
for both leisure activities and as retail channel, has forced businesses to consider the
internet as a business tool. The main requirement for music recording companies
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seeking a competitive advantage is increased knowledge and co-ordination of
processes that cross their marketing functions.Ince (2000), suggests that there is a
growing body of work which shows that the Internet is leading companies to develop
co-operative and less profit-centred activities which can be encompassed under the
broad heading of a supply chain network.
The rise of the Internet and the emergence of more co-operative, network-based
approaches to business have two significant implications for the music industry
supply chain. The first implication is that the supply chain will be radically
transformed, with many intermediaries disappearing and the power of the major
record labels diminishing. The second implication is that rather than purchasing
music, consumers may instead choose to share it between them, thus reducing the
sales and profits of record companies and artists. This assertion is supported by study
conducted by Graham et. al., (2002). However, in order to establish whether these
two developments are likely or not, it is necessary to identify specific changes in the
characteristics that determine a supply chain. During the last decade, many
organisations have developed some form of Internet presence (Reibstein, 2002).
Collins (2001) argues that the music industry has become an essential part of the
culture and society of Ghanaians in occasions such as birthday parties, marriage
ceremonies and other celebrations. Creativity, culture, history, and development are
all in themselves enough of an argument for the importance of understanding the
Ghanaian music, yet the music industry offers more than this. As an economic activity
music combines two characteristics that are critical to economic success. First music
is a form of electronic information and is easily transmitted to the world market. Thus
music is an ideal export product that is not constrained by the high transport costs
associated with the export of physical goods. Secondly, the music industry stands to
benefit substantially from the intellectual property rights. In addition to these
characteristics, the music industry is characterised by job creation possibilities and
synergies with other sectors of the Ghanaian economy. Collins (2001) indicates that
the music industry generates over $25 million to the value of the Ghanaian economy,
and a further $53 million through international sales. The ability to record music as
digital information coupled with the advancement of communication and recording
technology has begun to present an alternative challenges to the existing structure of
the music industry.
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The rapid growth of the internet and the related technologies has started to have an
impact on the medium in which music reaches the consumer. Traditionally, music has
reached consumers through the broadcast media or through the physical product such
as an audio cassette or a compact disc. However, the growth of the internet has
opened a new avenue through which music can be promoted and purchased. Internet
based retail allows consumers to order musical products on-line whiles the products
are shipped to the consumer. The other form of internet based retail is by means of
downloading songs onto consumers‟ hard drives. A study by Graham et. al., (2002) is
of the view that this phenomenon enables individuals to download music for free.
These activities affect the overall revenue of music companies, and also increase
music piracy. Although the study was conducted in the United States of America, its
findings can be adapted to the Ghanaian music industry. This is because internet
piracy has the same effect on music works despite cultural differences. Similar
structures prevail in the Ghanaian music industry where revenues are derived from the
sales of recorded music products.
Though internet connectivity and use are on the increase in Africa the number of
internet users is still very low. Jensen (2002) indicates that despite the fact that the
African internet user growth rate ranks third in the world (186.6 per cent); its
penetration is the lowest at 1.4 per cent. Each computer with an internet or e-mail
connection in Africa supports three to five users. The main barriers to internet
connectivity in Ghana and elsewhere in Africa may be attributed to the lack of
technical know-how as well as inadequate telecommunication infrastructure and also
high rate of poverty. In reference to the internet population in Africa, Darley (2003)
estimates that there are a little over 1 million subscribers in Africa. This figure is
however being challenged by Ondari-Okemwa (2004) who is of the view that South
Africa alone has close to 2 million subscribers.
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1.2 Objectives of the research
The objectives of the study will focus on the following;
c. To assess the prospect for the growth of online music marketing in Ghana.
The intense nature of the study has made it necessary to group it into five chapters:
Chapter one involves, background of the study, organisation of the study and
significance of the study.
The second chapter deals with the literature Review. This takes a comprehensive
study of the various elements such as concepts and theories that embodies internet
marketing and marketing in general. This chapter also takes a look at the
contemporary review of the subject within the Ghanaian and global music industry as
well as the online connectivity challenges in Ghana and Africa as a whole.
The third chapter is concerned with the research methodology. Here, the researcher
looks at the research and how it was designed, the data collection and the methods
that were applied in the collection as well as the places of collection.
The fourth chapter takes a critical analysis of the tools of internet marketing and its
impact on the activities of global music industry as well as the contemporary music
industry in Ghana. Also, the author takes into account the numerous challenges faced
by online service providers and its future prospects. This is then discussed into details
by identifying the various strengths, weaknesses, opportunities as well as threats.
The fifth chapter of the study crowns it all with a summary of the findings as well as
possible suggestions to find solutions to identified problems. It also takes a critical
look at the influence of information technology on the marketing activities of
organisations.
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1.4 Significance of research
However, despite offering huge potentials for organisations, the internet brings with it
potential obstacles such as internet connectivity challenges as well as the overall
internet population of Ghana. The study concludes by discussing some critical factors
that constitute challenges that will ensure success or could lead to failure.
Additionally, it will serve as a reference to any future research work and also to create
interest in this area of study. Finally, it will broaden the horizon and increase
understanding of the influence of the information technology on the overall value
chain of organisations in the music industry as well as and their subsequent impact
and its contribution to the economic development of Ghana.
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CHAPTER TWO
2.1 The Internet and the transformation of the music supply chain
The rise of the Internet and the emergence of more co-operative, network-based
approaches to business have two significant implications for the music industry
supply chain. The first implication is that the supply chain will be radically
transformed, with many intermediaries disappearing and the power of the major
record labels diminishing. The second implication is that rather than purchasing
music, consumers may instead choose to share it between them, thus reducing the
sales and profits of record companies and artists. In their study of music supply chain
mechanisms, Hardaker and Graham (2001) indicates that the internet has transformed
the entire music supply chain system with regards to purchasing and delivering of the
music product and services. This assertion can be noted in the ability of the internet to
remove cost-adding activities through the distributing of music digitally which
increases the speed and the convenience of doing business. Although the study was
conducted in the advanced music recording companies in the United States of
America, its findings can be adapted to the Ghanaian scenario. Similar structures
prevail in the Ghanaian music industry where substantial revenues are derived from
the sales of recorded music products in the form of CDs.
However a study by Graham et. al. (2004) proposes that the Internet is having a
major impact on how music is distributed. Music can be and increasingly is being
distributed in digital format through the Internet, both legally and illegally. The
Internet is transforming the structure of activities in the music industry both in terms
of virtual structures replacing physical ones, and network structures replacing
sequential ones. It eliminates the need for physical distribution and retail of products
and also allows both consumers and those involved in making and distributing music
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to communicate far more easily. This assertion is collaborated by Porter (2001)
suggesting that the Internet eliminates powerful channels and shifts bargaining power
to consumers. The traditional product in the music value chain is a package of pre-
recorded music captured on a physical product such as an audio cassette or a compact
disc. This format has been transformed by the advent of the internet which enables the
music product to be distributed in a digital format through the internet.
With the growth in its user base and its inability to be constrained by either time or
location, the Internet has the potential for mass communication and advertising with
negligible variable cost per customer. Such characteristics will enable the Internet to
replace traditional mass media. The marketing potential of the Internet has been
realised by organisations over the past few years, with its popularity as a medium to
target consumers increasing and many academics predict it will increase in the future.
This view was supported in an earlier submission by Potter (1994) indicating that
marketing online is more effective than marketing through traditional media channels,
with one vendor estimating that his marketing efforts on the Web resulted in ten times
as many units sold, with one tenth of the advertising budget. Organisations perceive
the Internet as a major communication tool in promoting corporations, their products
and services as well as a means of building brand awareness. The Internet offers
organisations the opportunity to utilise new channels of distribution and reshaping
consumer-shopping habits. The Internet‟s relatively low entry barriers, including the
irrelevance of company size, enhance its attractiveness as a distribution channel.
However, there is a contrary opinion by Porter (2001) proposing that strategies that
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integrate both the internet and the traditional competitive advantages and ways of
competing should win in many industries.
An earlier study conducted by Palumbo and Herbig (1998) advocate that trust is a
critical factor in stimulating purchases over the Internet, especially at this early stage
of commercial development. As a result, global brand development for online activity
is seen as essential on the Internet. It has been argued that the Internet‟s ability to
connect end users with producers directly will eventually eliminate wholesalers and
distributors, and reconfigure the supply chain of many consumer goods and service.
The rapid adoption of the Internet as a commercial medium has resulted in more
innovative ways of marketing to consumers in computer mediated environments. The
Internet has facilitated the ability of firms to reach target audiences more efficiently;
displacing undifferentiated mass marketing techniques for more customised practices.
A web computer news service is able to change advertisements on its site dependent
on the registered users reported purchase behaviour. The ability of such actions is
facilitated by the emergence of Web communities consisting of similar people with
like interests, and the increasing sophistication of technological developments. In the
study of Melewar and Smith (2003), it was proposed that the Internet simultaneously
facilitates the ability of an organisation to customise its interaction between its
customers on a previously unprecedented level. Using demographic data and the
history of previous interactions, organisations can obtain more accurate consumer
profiles, which are then used to create tailored experiences for visitors. A web site is
able to discover the musical and film preferences‟ of its visitors and then uses this
information to recommend CDs and movies to its customers and email details of
forthcoming releases and promotions that would be of interest to particular customers.
With the increased sophistication of server software global marketing strategies have
the ability to encompass tailored marketing for every visitor.
Contrary to local adaptation practices, the Internet fosters the global mass market
concept, thus, supporting the proposition that the Internet will lead to an increased
standardisation of products. Peterson et al. (1997) advocates that the global mass
market concept will thrive due to the increased levels of communication derived from
the Internet. In this regard consumers desire to share the latest trends around the world
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will only increase due to the Internet‟s revolution in worldwide communications. The
nature of the Internet promotes a globally standardised approach to advertising and
promotion, which enable firms to realise cost economies and establishes cohesive
product positioning world-wide. In support of this view, a recent study conducted by
Boudreau and Watson (2006) suggest that a firm‟s website is automatically visible to
all customers with web access no matter where they are located.
Activities such as frequently asked questions and email contact with organisations can
improve an organisation‟s customer service facility. The internet is also an efficient
means of conducting market research world-wide. Burke (1996) has demonstrated the
potential of the Internet in facilitating new product development through its ability to
conduct exceptional levels of research. This creates an interactive nature of the
Internet which permits businesses to collect data about customer preferences, attitudes
and behaviours. Previously, focus group interviews and questionnaires need to be
conducted to obtain such information.
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information inherent in the Internet has resulted in numerous price reductions. In this
vein, the study of Peterson et al. (1997) suggests that price competition is more
apparent where products and services are hard to differentiate. This is due to the
relative efficiency of price searching and the irrelevance online of other factors of
competition such as location.
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to the relational nature of services, relations are particularly important for service
companies.
In the building and management of relations, the interactivity of the internet makes it
a particularly useful tool. Several stages of e-marketing can be defined ranging from
the contact stage focusing only on promotion and information to the relate stage when
a two way relationship is established and the internet is integrated into business
operations. A fruitful relation can be created when customers choose a company as
their primary choice on a long term basis, which many customers tend to do if they
feel that the communication and delivery is satisfactory.Zeithaml (2002) argues that in
order to relate to customers via the web, companies need to shift their focus from web
presence and low price to delivering electronic service quality. In this regard, record
companies distribute music in digital format through the internet including services
such as music downloads and peer-to-peer music sharing to forge long term
relationships with customers. Supplementary services, which are more relational, have
a stronger bearing on customer satisfaction than the core services .In using the new
technology, companies‟ needs to continuously create new supplementary value for the
customers in order to build active relations. By using e-bulletins, newsletters
delivered via e-mail, companies can keep the audience informed about new features
on their website.
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the Internet has major implications for the whole marketing mix, having an effect on
advertising, research, sales, promotions, coupon distribution and customer support
.However, empirical evidence on actual practice is scarce. One study suggests that so
far most firms are using the Internet simply for information provision rather than for
any more sophisticated customer interaction (Arnott and Bridgewater, 2002).
With regards to consumers‟ attitudes for shopping online, a study by Monsuwe et. al
(2004) suggests that consumers‟ decisions whether or not to shop online are also
influenced by the type of product or service under consideration. Although this study
was carried out largely in the US and Europe, its findings can be adapted as a
framework to review literature. The lack of physical contact and assistance in
shopping on the Internet is one factor that influences this suitability. Another factor is
the need to feel, touch, smell, or tries the product, which is not possible when
shopping online.
Standardized and familiar products such as books, videotapes, CDs, groceries, and
flowers, have a higher potential to be considered when shopping on the Internet,
especially since quality uncertainty in such products is virtually absent, and no
physical assistance or pre-trial is needed. On the other hand, Elliot and Fowell (2000)
states that personal-care products like perfume and lotion, or products that require
personal knowledge or experience like computers and cars, are less likely to be
considered while shopping online. However, in case of standardized and familiar
goods, or certain sensitivity products that require a level of privacy and anonymity,
consumers‟ intention to shop on the Internet is high (Grewal et. al., 2002).
During the last decade, many record companies have integrated the internet into their
marketing functions. In support of this, Graham et. al.(2004) suggest that the internet
is having a major impact on how music is distributed as well as changing the way
record companies carry out their business activities. The established tools of
promotion, such as advertising, sales promotion and direct marketing have been
augmented by the introduction of the internet technology. There has been
considerable research into how advertising accomplished by using the internet. A
study by Meadows-Klue (2002) advocates that although the internet is a young
medium to for undertaking advertising, it has already reached maturity and is being
recognised as a branding medium.
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Sales promotional activities such as buy-one-get-one free may be difficult to replicate
in the virtual environment, however, recording companies offer the possibility to
download music products at a discount price. The new generation of iPod and other
models protects the rights of music companies and owners whiles allowing a
relatively cheap payment system that still allows users an affordable option for
accessing music over the internet (Herther, 2005).However, there are other forms of
technological activities aided by the internet such as peer-to peer (P2P) networks
which have adverse effects on the entertainment industry. This network enables the
downloading of music off the internet and transferring onto a CD without
compensating the artiste who created the music or the firm that created, packaged,
promoted and distributed the music materials. A survey by Harley (2002a) estimates
that about a third of burned CDs contain songs downloaded off the internet of which
99 percent are retrieved from an illegal internet sites and unauthorised file sharing
services. Although this research was conducted in the US college environment, its
findings are relevant to this research. With the background that internet usage is
dominated by college and university students worldwide (Alemna and Adamu, 2005).
A report by African Internet Connectivity (2002) indicates that due to the relatively
small number of people who can afford a phone line, let alone a computer, Internet
public access services are more widespread in the urban compared to rural areas in
Africa. However the future of internet connectivity in Africa appears to be
increasing.Sairosse and Mutula (2003) argues that cybercafés have grown consistently
in Africa during 2001 and offers the most important and popular options for access to
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the Internet for majority of users, since individuals and some organizations cannot
afford dedicated access and have to use shared access.
In general, cybercafés are the most important and popular options for access to the
Internet for majority of users, since individuals and some organizations cannot afford
dedicated access and have to use shared access. Sairosse and Mutula (2003) suggest
that in Ghana there are over 150 cybercafés with 90 per cent of these cafés found in
the national capital Accra. The internet population in Ghana are very few which does
not encourage internal online transactions; hence most of the online transactions are
geared toward the international market of mainly US and Europe destinations.
The internet has become a very important source of information and also offers an
array of capabilities for communicating and retrieving information. These
characteristics of the internet have propelled it to become a useful tool for academic
purposes. The ability of the internet to make available wide range of information such
as up-to-date research reports, and also making it possible for scholars at different
locations on the globe to interact and exchange views, opinions and ideas on various
fields of study makes it an integral component of improving education.
A study conducted by Adika (2003) on the internet usage by Ghana‟s three older
universities reveals that despite the benefits of the internet, its use among faculty
members is still very low. The reasons assigned to these results are that there is a lack
of access to the internet and also the need for training. In another development,
findings from a study by (Alemna and Adamu, 2005) conducted on the campus of
Ghana‟s premier university suggest that none of the users of the internet had
something to do with academic activities such as submitting assignments or
discussing academic problems with professors. This aspect of internet usage will have
to be enhanced through training to achieve the maximum benefits.
There are a number of factors that hinder the growth of the internet usage in the sub-
Sahara African region. These include inadequate computers with internet facilities,
slow internet connection, lack of skills and frequent power cuts. These factors have
been corroborated by studies conducted by researchers such as Ngini et al (2002) who
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conducted similar studies on the internet usage in the African continent. The slowness
of internet access has been attributed to the low bandwidth. Furthermore, high
illiteracy rates in addition to the level of poverty equally contribute to the low usage
of the internet technology in the African continent.
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CHAPTER THREE
3.0 METHODOLOGY
3.1Introduction
Woodside and Wilson (2003), describes case study research as inquiry focusing on
describing, understanding, predicting, and/or controlling the individual. Parkhe (1993)
suggests that there are two major approaches to theory development, deductive theory
testing and inductive theory building. The difference between the two approaches can
be viewed in terms of scientific paradigms, with the deductive approach representing
the positivist paradigm and the inductive approach representing the phenomological
paradigm (Easterby-Smith et al., 1991). More precisely, the phenomological paradigm
can be divided into three: critical theory, constructivism and realism (Guba and
Lincoln, 1994). Boing (1994) advocates that realism is the preferred paradigm for
case study research for several reasons. First, case study research areas are usually
contemporary and pre-paradigmatic, such as inter-organizational relationships and
relationship marketing.
Hunt (1991) states that, the research areas usually require inductive theory building
for deduction from already existing principles of a paradigm is likely to be difficult
where accepted principles and constructs have not been established or are clearly
inadequate. Second, realism does not suffer from the limitations of relativism. In
other words, case study research efforts usually involve the collection of perceptions
of unobservable external world phenomena such as perceptions that are unobservable
(Hunt, 1991), for example, views about non-economic and non-technological
motivations in relationship marketing. As has been noted in the marketing literature,
positivism requires that only observable phenomena can and should be researched, so
realism rather than positivism is a more appropriate epistemological guide for case
study research.
This work is based on a study which examined the impact of internet marketing on the
overall service delivery system of the recording industry of Ghana as well as to
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identify the various barriers to internet connectivity. The researcher has worked for
over ten years in the recording industry and therefore have vested interest in the area
of research. A case study research strategy was adopted, since it can shed more light
on a dynamic and fast moving situation. The case study strategy has considerable
ability to generate answers to the question „why?‟ as well as the „what?‟ and „how?‟
questions (Saunders et. al., 2003). The researcher choose to use the inductive
approach which focuses on the context in which such events were taking place, and
also held a strong interpretivism research philosophy. Therefore the study of a small
sample of subjects might be more appropriate than a large number as with the
deductive approach (Saunders et. al., 2003).The study of Lynch (1994) identified that
case interviews help confirm the shape and spread of key issues and assist in more
precise hypothesis formulation. The wealth of information provided however must be
balanced against the reduced number of people and cases studied. Clearly this
increases understanding of cases but reduces the generalisability (Patton, 1990).
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functions of the method by which the data were collected and the source. The validity
and reliability of collection methods for secondary data will be easier to assess where
a clear explanation of the methodology used to collect the data (Saunders et. al.,
2003).The researcher paid careful attention to the sources of information used to
ensure their validity and reliability to the research work.
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3.3.1 Questionnaire design
For the purpose of data collection, both closed-ended questions as well as open-ended
questions were developed to allow ease of understanding for the respondents.
Saunders et al (2003) reveals in a study that closed-ended questions are usually
quicker and easier to answer, as they require minimal writing. Responses to closed-
ended questions are also easier to compare as they are predetermined. Open-ended
questions were also used to find out what is uppermost in the respondent‟s mind.
Appendix 1 holds the questionnaire that was despatched to the organisations.
Respondents were asked to select and tick their answer from a prescribed list of
questions which were adapted based on the review of literature and also from having
conversation with reputable individuals in the recording industry in Ghana. Questions
one and two were used to determine the attributes of the organisation as well as
respondents position in the organisation to ensure that questions were being answered
by the both prescribed individuals as well as organisations.
In order to collect opinion data from the respondents, the researcher used the Likert –
style rating scale. This gives the researcher an idea of how strongly a participant feels
about something and also gives more detail than a yes and no answer as well as
enabling the statistical analysis (Saunders et al., 2003).Ranking questions were also
asked by the researcher for respondents to place their responses in order of
importance. This enabled the researcher to discover the relative importance
respondents attached to an item. Category questions were also incorporated in the
questionnaire so that each respondents answer can fit only one category. Saunders et
al., (2003) suggest that these types of questions are particularly useful if there is a
need to collect data about behaviour or attributes.
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concerns (Saunders et al., 2003).A postal questionnaire method, as previously
identified was preferred as the most productive way of securing responses in a
confidential considering the distance between the researcher and the respondents as
well as the financial resources required to carry out a one- to- one personal interviews.
3.3.2 Validity
To ensure the validity of data collected, the design of questions and the structure of
the questionnaire were well thought out. The researcher ensured also that the order
and flow of questions in the questionnaire were logical to the respondents. Also, the
researcher ensured that the questionnaire was carefully introduced to the respondents
to ensure a high response rate. By examining the questions by which data were
collected, a further indication will be gained of the validity (Saunders et al., 2003).
3.3.3 Reliability
Reliability of data is very crucial in this study. The researcher compared data received
from the study to existing theories and results in order to lessen the threat to
reliability. In order to increase reliability, Saunders et al., (2003) suggest that where
data from two or more independent sources suggest similar conclusions there is
confidence that the data on which they are based are not distorted.
3.3.4 Generalisability
Although it was case study, broad inclusion of data sources was applied to enhance
generalisability of this study. However, the researcher does not claim that the results
of this study can be generalised in every situation outside this study. Bickman et al.
(1998), emphasise that there is no question of trying to determine causal links or to
generalize research findings.
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questionnaires were administered to the stakeholders in the music industry who offer
online marketing services. The instrument included a series of open questions to
obtain responses required to answer the research objectives.
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CHAPTER FOUR
4.0 RESULTS AND ANALYSIS
4.1Introduction
In the interpretation of results, both qualitative and quantitative analysis was used to
assess data received. Saunders et. al., (2003) proposed that quantitative analysis helps
in the answering of research objectives by assisting in the quantifying of numerical
data. Quantitative data involves those questions which were placed in ranked order
and also those questions in the category order. Although these are descriptive data as
it is impossible to measure the category numerically or to rank it .In support of this
assumption, Morris (1999), proposed that although these data are purely descriptive, it
could be counted to establish which category has the most and whether cases are
spread evenly between categories.
Qualitatitive analysis was used to assess questions 12 and 14, in order to comprehend
the meaning of text. This method was preferred because it helps to classify non-
standardised responses into categories before they can be meaningfully analysed.
Robson (2002) suggest that such concepts of qualitative data are characterised by their
richness and fullness based on the opportunity to explore a subject in as real a manner
as is possible.
Additionally, the same pattern for analysis was applied to the opinion (category-,
ranking questions), open-ended as well as closed questions. The tables were made up
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of mainly three columns; stating the answer to the question, the quantitative
assessment as well as the calculated percentage. This format was only changed where
conditional questions were asked or when change was required for convenience. The
answers to the open-ended questions are not ranked in order of preference but relate to
the number of responses to each factor.
4.2 Results
The researcher sent out 15 self-administered questionnaires to online music marketing
companies in Ghana. The online sector is dominated by these 15 companies. Ten
usable questionnaires were received by the researcher representing 75 per cent of data
collected. The results by questions are detailed below and given the following results:
1. Do you offer online marketing services? Yes or No. A response rate of 100%
of returns answered yes to this question (see table 1). This response was
important as it identified that the selected companies are engaged in online
music marketing.
2. What type of company are you? This question measured the attributes of the
various companies. The response yielded a 50% describing their organisation
as music distributors. A further 30% responded as being online marketers,
with 10% each describing their companies music producers and one stop
shopping centre respectively(see table 2).This response enabled the researcher
to classify the various companies into specific groups to aid in the data
analysis.
3. What is your position in the organisation? This researcher used this question to
ensure that the required individuals respond to the questionnaire. Responses
received indicated that 60% were marketing managers, whiles 20% each
represented Human resource manager and Chief executive officer
respectively(see table 3). There was no response for the position of financial
manager. This will ensure that responses are provided by designated
respondants.This also provided the researcher with opinions of the various
managerial positions.
4. What type of music do you market? This question received 73 responses from
the respondents. See table 4 for the responses to this question. This question
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was used by the researcher to assess the range of products being marketed by
the various companies.
5. How do you use online marketing in your marketing –mix? This question was
used to measure the attributes of the various companies in their approach to
the marketing –mix considerations. There were various degrees of opinions of
how companies incorporate the marketing function. The responses are
represented in table 5.
6. Who are your target markets? Ninety per cent of the companies choose Europe
as their most important choice. Ten per cent of the respondents choose North
America as their most important choice (see table 6).
7. Why do you target these markets? This question received a total of 70
responses from the respondents. There was 100% response rate in favour of
profitability as an important motive for the choice of a target market. The
overall results are illustrated in table 7.
8. What is the age limit of your target audience? The age category of between 25
and 35 received a 100% response as the most frequent users. Please refer to
table 8 for the overall representation of the results.
9. What percentage of sales does online market contribute to the overall sales
revenue? This question received a total of 10 responses.Fourty per cent of the
companies responded that online marketing contributes between 30-39 per
cent of their overall sales revenue. Three online marketing companies
responded that online marketing contributes between 60-100 per cent of their
overall sales income. Two companies responded that online marketing
contributes between 10-19 per cent of its sales revenue whiles one respondent
said it contributes between 20-29 percent of total sales (see table9).
10. Have your sales increased over the last year? This question received a 100%
yes response. There was an indication that all the participating companies have
had an increased in their sales revenue over the last year.
11. By how many percent? There was a 30% response rate each in respect of
between the categories of 20-29 and 30-39 per cent respectively. There was a
further 20% response for the category of between 10-19 per cent, whiles two
companies responded as having 40-49 per cent and 50-59 per cent increase in
sales respectively (see table 11).
25
12. What factors may have/not have influence these increase or otherwise in
sales? This question received various responses (see table 12).This question
received various responses. The six respondents out of ten cited excellent
services as the main influence for their increase in sales.
13. What are challenges you encounter in offering online marketing services? The
category of both slowness of system and frequent power cuts received a 100%
responses as key challenges to online marketing in Ghana. The overall results
are shown in table 12.
14. What are the future prospects of music online marketing in Ghana? A 100%
responded that the future of music online marketing is good.
15. Please give reason(s) in response of question 13 in your own words (see table
15).
4.3 Analysis
This part of the work discusses the author‟s findings of primary data (self-
administered questionnaires) against the literature that was reviewed in Chapter Two.
With regards to conducting a successful analysis, Saunders et al (2003) suggest that
analysis without a designed framework is difficult for an inexperience researcher and
might not result in a successful analysis of data. In pursuance of this, the author
designed a framework which emerged from the answers to the questionnaire. In order
to meet the research objectives, the analysis will be discussed along the following
headings.
The issue of direct marketing received produced mixed results as to its importance in
the marketing functions of the organisations which participated in the research. Forty
26
per cent viewed it as very important whiles 60% said it has some importance (see
table 5).The research results highlighted a contrary view to the use of direct marketing
by the participating companies since online marketing is viewed as a component of
direct marketing. A study conducted by Harridge-March (2004) suggests that since
the ultimate role of direct marketing is to gain a response, the internet has the
advantage of soliciting such responses in real time. This assumption places the
internet as a tool which enables providers to interact with potential and actual
consumers as well as enabling intra-customer communications.
Results showed that 40% of respondents regarded sales promotion as very important
whiles 60% said it has some importance in the marketing –mix considerations (see
table 5).This findings is consistent with that of Gordard (2003) who found that price
incentives are offered to promote web purchases in an attempt to convert customers to
internet shopping.
Figures from the research showed that 40% regarded personal selling as having some
importance whereas 60% viewed it as a very important aspect of the marketing
function. The internet is regarded as lacking the personal interface being offered in the
traditional marketing practice. A study by Harris et al (2000) emphasis that for many
consumers, the social interchange involved in some marketing channels adds to the
enjoyment of undertaking a transaction. Nonetheless, the lack of human face of the
internet can be minimised by the introduction of chat rooms and forums in answering
consumers‟ questions in real time.
27
4.3.2Who are your target market and why
Results of this study shows that majority of the music online providers have bulk of
their market in Europe and the North America. Ninety per cent of respondents rated
Europe as their first choice of market destination, whereas North America was rated
second in that order. This results was consistent with the study results of Collins
(2001), who stated that majority of international sales is generated from the over three
million Ghanaians living in Europe. This brings factors such as cultural connectivity
and high Ghanaian population.
The results of the study showed that the motive for profitability received a 100%
response rate. This finding demonstrated that organisations view as a very important
component of running an enterprise. It emerged from the study results that service
quality and fast internet connectivity shared common responses from the participating
organisations. They both received an 80% response as very important reason for
choosing a target market. Previous studies by Van Riel et al (2001) reveal that there is
significant correlation information downloading speed and the web user‟s satisfaction.
It emerged from the studies that the age categories of 25-35 were the respondents‟
most frequent users. This outcome may suggest that young people have the propensity
for the internet, presumably because of the awareness they acquire while in school
and colleges. This finding is consistent with earlier studies conducted in Botswana an
African country by Sairosse and Mutula (2003).This result could also suggest that this
28
majority of users in the age bracket have necessary skills and awareness about the
internet and can afford to pay for the service.
The study further reveals that all the organisations under research have experienced
increased sales over the last year. The three online music marketers said they have an
increase of between 20-29%in their sales over the last year. This figure was however
consistent with Matthews (2001b) research findings. There was an increase in sales of
between 50-59%, and 40-49% by a respondent each. This study revealed that the three
participating online companies do not offer offline marketing services.
29
The study further reveals that perceived lack of expertise remains largely as an
uncertain challenge to the running of online marketing in Ghana. Results suggest that
80% of respondents say that there is adequate expertise and human resource with the
required skills and knowledge in the online marketing industry. This result is
generally not consistent with the widely held perception that Africa lacks adequate
expertise in this area of operation.
The results show that low profitability and low patronage were regarded as uncertain
being challenges to offering online services in Ghana with a 60% response
respectively. However, there was 10% response that said it was a key challenge,
whiles 20% said they disagree of it being a challenge. This suggests that there is a
correlation between online organisations targeting markets with high Ghanaian
population in association with cultural connectivity to satisfy their customers and also
to make profit.
Study results suggest that 70% of online organisations under review said that they are
uncertain of the challenge with regards to new competition. This could be attributed to
the fact that there are only few organisations offering these services. There is also the
possibility of high barriers to entry resulting in few companies dominating and
serving these markets.
There were various reasons with regards to the future prospects of online marketing.
These reasons are expressly spelt out in table 15. In all cases, the vast majority of
respondents are positive, which suggest that online music marketing is perceived as a
valuable marketing tool irrespective of the technological challenges. It also appears
30
that, irrespective of the available connectivity infrastructure, there is almost
agreement among the respondents that the internet has improved their marketing
operations. Seven respondents representing 70% of the total received responses
indicated that online marketing offers convenience to their customers. In a related
development, 60% also suggest that online music marketing provides convenience to
their clients‟ needs. A further 40% indicated that Ghanaians living abroad have the
tendency of being internet literate. Additionally, 50% of respondents said there is trust
between clients and online providers.
31
CHAPTER FIVE
5.1Conclusions
The global market that is emerging is a digital market and the digital revolution that is
occurring in the global music industry has far-reaching implications for the Ghanaian
music industry. This study has sought to examine how online marketing is
transforming the Ghanaian music industry. It is gratifying to note that companies in
Ghana are able to reach their target market through the means of internet technology.
The study brought to the fore, how online music marketers are able to strategise their
marketing functions through the means of the internet technology. Perhaps the most
significant aspect is the way internet technology is incorporated into the marketing –
mix considerations of the participating organisations. It is gratifying to note that most
organisations use online marketing as a marketing strategy to reach the international
market, and as such regard it as means to distribute their products. The use of
advertising featured prominently as the most elements in the marketing –mix.
It is clear that majority of organisations within the music industry have some type of
internet access which means that the immediate barrier of lack of access to the
internet is disappearing. However, it is apparent that other factors prohibiting internet
use appear to exist in the immediate Ghanaian environment and the African continent
as a whole. This notwithstanding, it appears that attitude towards internet use in the
region is gradually improving.
By incorporating the internet into their daily operations, as well as having a well
thought out strategy, organisations can access larger audiences. It also provides
32
opportunity for these organisations to increase awareness without incurring additional
costs.
As far as potential benefits are concerned, it is evident that all organisations under
research recorded profits in their transactions over the year. This shows that the
benefits outweigh the costs incurred in running it. Evidence from the data received
shows that organisations under review experienced sales increase over the period
under consideration.
This study found out those organisations, regardless of level of internet use feel the
internet is a cost effective way to market their products and promote awareness.
Indeed majority of organisations perceive the internet as both a marketing and
communication tool offering low cost expenditure and high financial benefits.
Significantly, the study revealed that despite the internet having the tendency of
reducing the size of the world, it did not eradicate the presence of culture influence in
international marketing. This was observed in the study, as majority of organisations
under research considered high Ghanaian population and cultural connectivity as
determinants for choosing their target markets.
The transformations in the Ghanaian music industry and the international music
industry in particular have been sparked by new technologies and internet use to
distribute music as a digital good. The ability to distribute in digital format over the
internet are driving changes in the Ghanaian music market structure and also having
significant impacts on the traditional recorded music value chain.
The study revealed that music purchases on the internet were suited to the internet
demographic of young and enlightened customers in the developed countries of high
populated Ghanaians who are also culturally connected.
The phenomenal technological advances in the digital technologies have enabled the
internet to become an efficient medium for accessing music both by downloading it
directly and indirectly, and also by acquisition of CDs from online retailers. Such new
developments in media and the entertainment industry in Ghana open up many new
33
opportunities for the record companies. At the same time record companies from
developing countries can benefits from these new trading opportunities.
The revenue potential of music online is very promising as revealed in the study, as
more and many internet users listen to and acquire music online. Such opportunities
can be captured by online music providers in Ghana to increase their revenues as well
as their market share.
Given the nature of traditional trade and commerce in the Ghanaian music industry, it
is reasonable to assume that through digital distribution of music and the development
of appropriate music sites, record companies will be able to capitalise on the
opportunities created by the convergence of e-commerce and music. Most of the
websites related to the online retailing of Ghanaian music specifically do not yet
permit diffusion of music in the full sense, since records can be ordered on the net but
physical delivery is made by post.
Most internet websites that promote and sell Ghanaian music seldom sell to the
Ghanaian customers mainly for the reason of absence of local bank facilities which
would permit the processing of online credit card transactions as well as lower
internet user population.
In line with the study objectives, it is revealed that majority of record companies in
Ghana use the online marketing as a strategy to reach the international market. These
findings were made known from the results of the questionnaire. The prime target
markets of those record companies were observed to be Europe and the North
America, thus companies are able to export their products. This is consistent with the
study of Lazer and Shaw (2000) which suggest that the internet‟s global connectivity
and lower resource requirements makes it suited to export marketing in any setting.
The frequent power cuts and slowness of system is viewed by online music marketing
companies in Ghana as major barriers militating against their operation. This finding
was in line with the study conducted by Jensen (2002) suggesting that the slowness of
system is caused by internet service providers operating on very low bandwidth links.
34
Despite the numerous challenges affecting the operation of online marketing, results
revealed that participating organisations are optimistic of prospects for growth in this
direction. This response presents a platform for the improvement of the quality of
service.
5.2Recommendations
The findings of research shows that online music marketing in Ghana is in its infancy
and is hampered by obstacles which are mainly frequent power cuts and slowness of
system. In addition, there are significant knowledge and institutional gaps with
regards to the music industry in Ghana which prevents it from maximizing its
potential.
The use of online marketing in Ghana can provide its music industry with a unique
opportunity for accelerated growth and development. If Ghanaian music is to compete
in the international market, and make significant impact on the country‟s economic
performance, then record companies in the industry should align their marketing
strategies and embrace information technology.
Advances in digital technology are revolutionising the way people communicate, and
are also breaking down barriers created by distance. Music is mainly regarded as a
universal means of communication, and the businesses which support it, are being
transformed and redefined. In this vein it is recommended that online music
marketing companies be able to widen their target market to include the wide
international market and limit it to Ghanaians in those markets only.
Given the level of the internet infrastructure and pace of innovation in technology in
Ghana, if the online music distribution is to evolve into a more formal and defined
structure, certain critical issues must be rapidly addressed. The issue of frequent
power cuts and the slowness of system must be tackled by public policies, private
sector initiatives and joint public and private sector partnerships, which support both
internet business and the music industry. Electronic commerce will more than likely
become a way of life the Ghanaian music businesses when it becomes a norm in other
forms of businesses in Ghana.
35
The commendable initiatives already in place to address the above issues both at the
national and the international levels should be encouraged and supported so that the
convergence of internet marketing and music will result in the anticipated benefits of
economic growth and wealth creation for the Ghanaian music industry over the next
ten years.
Among the actions which need to be taken include: firstly, to create a joint strategic
partnership between governmental sectors responsible and the private sector to
develop a policy framework for the promotion of Ghanaian music online. Secondly,
there is the need to create a legislative and regulatory framework conducive to e-
commerce in general. Thirdly, to fund research projects in the areas where there are
knowledge gaps surrounding electronic commerce and music, which will add new
knowledge and also act as reference point for future research work.
36
CHAPTER SIX
After starting the literature review the author realised that there was rarely any
academic articles on the subject matter. This realisation rather motivated the author to
undertake this research work to break the ground for future research and also act as a
reference point in this area of work.
In the course of this research work, the author developed better understanding of how
important the subject matter was, and how it is transforming the entire global music
business. It also brought to fore that the use of information is critical in this era of
globalisation where economic progress is becoming increasingly knowledge-driven,
and information and knowledge are becoming primary wealth-creating assets.
The author realised that previous studies on the course provided impetus and depth of
knowledge to the overall understanding of the research work. There was the need to
network with my representative in my home country. These skills were acquired
through modules such as People management and development and Human resource
management. There the need to work as a team in order to achieve the desired
objective.
This research work has really broadened my perspective on the usefulness and
importance of knowledge. The majority of the literature review used for this research
work was adapted to suit the Ghanaian situation. This has awakened my realisation
that there is much to be done in this field of work to aid in future research.
37
The primary objective of research work is to bring out new knowledge as well as
contribute to existing knowledge. I have realised through this research that to be
competitive in every endeavour of situation, one need to consistently engage in
research to upgrade existing knowledge and also to bring out new knowledge in
relation to real life situation.
As the research sample size was very small and resources in the form of literature in
relation to the subject matter were limited, the findings of this research cannot be
generalised. The Ghanaian music industry does not have a data base from which
information could be obtained to facilitate the objectives of the research. The author
had to review literature from various academic texts and adapt it to the Ghanaian
environment.
Finally, the author has gained enormous wealth of knowledge by undertaking this
research work. This wealth of knowledge will be adapted to the Ghanaian situation in
a bid to improve the current state of the Ghanaian music industry.
38
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46
Appendix 1.
Good morning/ afternoon/ evening. My name is Kofi Otabil, an MBA student from
Staffordshire University in the United Kingdom.I have appointed Mr. Kojo Nkrumah
music retail and the marketing strategy of recording companies in Ghana and also the
Thank you for agreeing to take part in this survey, the questionnaire contains 13
questions; it should take no longer than 10 minutes overall to fill in the entire
questionnaire.
Please be assured that the results of the survey are private and confidential.The survey
Kofi A. Otabil.
PS: Please note however that you can withdraw from participation at any point.
47
Questionnaire
1. Do you offer online marketing services? Please tick the answer that applies in your
Organisation.
Yes No
2. What type of company are you? Please tick the answer(s) that apply.
Other……………………………………….
Other………………………………………………………
4. What type of music do you market? Please tick the answer(s) that apply.
Hip-life R&B
48
5. How do you use online marketing in your marketing-mix? Please rank each item
below in order of importance.
Direct marketing
Sales promotion
Advertising
Distribution channel
Personal selling
Publicity
Product information
6. Who are your target markets? Please rank each item in order of importance.
Ghana
North America
Africa
Europe
Asia
49
7. Why do you target these markets? Please rank the answer(s) in order of importance.
Profitable
Cultural connectivity
Market potential
Service quality
8. What is the age limit of target audience? Please rank the item(s) in order of
frequency. Number the most frequent1, the next 2 and so on.
15-25
25-35
35-45
45-55
55-65
65-80
50
9. What percentage of sales does online marketing contribute to the overall sales
revenue? Please tick the category that applies in your situation.
0-9
10-19
20-29
30-39
40-49
50-59
60 -100
Yes No
12. What factors may have/not have influence these increase or otherwise in sales?
Please respond in your own words.
51
13. What are the challenges you encounter in offering online marketing services?
Please tick the box that matches your view most closely.
Lack of expertise
Slowness of system
Expensive to maintain
Low patronage
Low profitability
New competition
14. What are the future prospects of music online marketing in Ghana?
Thank you.
52
Tables
Answer Yes No
No. of responses 10 0
Total % 100 0
The above table shows the responses received .All the organisations were engaged in
online music marketing.
53
Table 2: What type of company are you?
The table illustrates the attributes of the various organisations which participated in
the research.
54
Table 3: Your position in the organisation.
The table above depicts the personnel who were engaged in answering the research
questions.
55
Table 4: What type of music do you market?
Answer Pop Hip- Hip- Gospel Traditional Classical Burger Hip- R&B
hop life hi-life life
No. of 6 6 10 10 10 4 10 10 7
responses
Total % 60% 60% 100% 100% 100% 40% 100% 100% 70%
56
Table5: How do you use online marketing in your marketing –mix?
57
Table6: Who are your target markets?
58
Table 7: Why do you target these markets?
59
Table 8: What is the age limit of target audience?
60
Table 9: What percentage of sales does online marketing contribute to the overall
sales revenue?
61
Table 10: Have your sales increase over the last year?
Answer Yes No
No. of responses 10 0
Total % 100 0
62
Table11: By how many percent?
Answer 0-9 10- 20- 30- 40- 50- 60- 70- 80- 90-
19 29 39 49 59 69 79 89 100
No. of 0 2 3 3 1 1 0 0 0 0
responses
Total % 0 20 30 30 10 10 0 0 0 0
63
Table 12.What factors may have/not have influence these increase or otherwise in
sales.
Responses Frequency
Improved supply chain 2
Having well stocked CDs 3
Excellent services 6
Wide range of music products 4
Improved services 3
Offering value for money 4
Have right stuff at the right time 4
Better service quality 6
Quality of goods 4
Increased product range 4
Having required range of products 4
available
64
Table 13: What are the challenges you encounter in offering online marketing
services?
65
Table 14: What are the future prospects of online music marketing in Ghana?
66
Table 15: Please give reason(s) in response of question 14 in your own words.
Responses Frequency
Online music buying is catching up with 1
Ghanaians
It offers convenience to our customers 7
Increased awareness of online purchases 4
Its an emergent market 1
Online services are improving 2
Ghanaians are appreciating the value of 2
online marketing
Comfortability of shopping at home 6
Most Ghanaians living abroad are 4
internet literates
Online marketing is gaining awareness 2
with the general populace
There is trust between providers and 5
clients
67
68