Media & Entertainment: The rapid pace of media formats
I thought I would share with you this great animation which shows how media formats have evolved enormously over the last 30 years...
Looking back over just the past 5 years, this rapid media evolution has highlighted several opportunities for many retailers, enabling retailers to reach more customers, more often. It has also highlighted weaknesses as other retailers failed to adapt fast enough to the rise of digital music and the impact on superseded formats such as CDs*.
Staying on top of these constantly changing media formats is a challenge for all participants in the Media and Entertainment industry, but ensuring the business is buying the right media format, at the right time, for the right reason is even harder. Getting it wrong can be catastrophic for your top-line growth and will have shareholders breathing down your neck.
Keeping abreast of developments across all media formats is a mammoth task. However, it is necessary to not miss the next big trend. Equally, suppliers will always have the ‘next-best thing that is going to take the world by storm’ and can often sound pretty convincing – and investing in a trend that never takes off can be costly. The good news is that procurement can and should help, in addition to your own market intelligence efforts, by ensuring an effective sourcing process is undertaken (which should include extensive research into alternatives), thereby cutting through the nonsense, and often helping to confirm or disconfirm a supplier’s pitch.
Our experience within Universal Music has shown that to succeed, it is essential for the procurement team to truly understand the business drivers and demands in order to question the efficacy of a solution. For example, by conducting a standard sourcing process of CD booklets, a significant reduction in cost was achieved. However, when we began to question and challenge the business rules wrapped around the entire process (i.e. changing how the booklets were being printed), we were able to improve the outcome by more than 3 times the initial result.
I would be interested in hearing some success and horror stories from people buying these rapidly changing media formats across the Media & Entertainment industry.
* Find out more about the impact of consumer trends in our Retail whitepaper
** Image Reference: http://www.digitalmusicnews.com/stories/081611thirty