Strategy And Brand Management Assignment Sample

Introduction Of Strategy And Brand Management Assignment 

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The process of differentiating the firm from its rivals in a manner that increases affinity for the brand among the target audience is known as brand positioning. Its objective is to create a mental association between the company and a concept or category in the minds of potential clients (Widjaja, 2022). The firm delivers its goods at a premium price but has a very high demand due to its value-based experience approach. This is done via the branding of the product in the competitive market. Performing a competitor study, also known as competitive analysis, entails identifying competitors in the market and knowing about their various marketing strategies. This information may be used as a benchmark to evaluate the company's strengths and flaws to those of each competitor.

In this regard, this particular report will discuss the competitive strategic aspects followed by the companies where this report depicts the brand positioning of Spotify. This report will gather the relevant information from the sources of scholarly papers that will inform the better and more authentic knowledge as per the chosen criteria of the report. In this regard, this report will focus on the approaches of marketing mix which help to determine Spotify evaluate its approaches for brand promotion as well as positioning in the highly competitive global market.

This report mainly focuses on concise suggestions for the company. The accurate suggestions for this conglomerate will help the better proposals of the brand positioning along with its competitors. This report will use all the credible and valuable sources that will confirm the reader for the authentic information of the report.

Company Background

Spotify is an audio streaming platform specifically designed for young people. This platform has transformed the way people pay for music and led to innovation in the music industry. The viewers can find in excess of 70 million tracks for almost free and they also can get a monthly subscription (Nugroho et al., 2022). This platform established in 2006 rise in a swift manner and gain huge popularity among the Indian audience. The preliminary report shows that along with having 286 million active operators at the starting point of 2020, the Swedish company regulates the overall 36% of the international streaming industry.

It has been measured that after getting a subscription along with a fixed monthly price, the user will be able to get the facility of offline music, ad-free listening and enhanced sound quality (Vonderau, 2019). As per the report of 2021, Spotify claims 356 million active users and that is indeed great for the revenue of the company. The company consists of a substantial marketing strategy in order to draw attention to younger consumers. Moreover, through establishing an innovative marketing platform the company is gaining a huge number of users and the marketing approaches of this streaming platform alter every year. 

Theories to Determine Competitor Analysis and Brand Positioning

Porter’s Five Forces

The application of Porter's five models is helping a business to analyse the current situation that occurs in the market. These variables include the number and quality of a company's fiercest rivals (Eymer, 2022), potential new market entrants, suppliers, clients, and substitute goods all of which have an effect on the profitability of the business. It is possible to impact company strategy and improve competitive advantage by looking at the Five Forces.

Market evaluation of the company has explained that there are already many substitutes for music streaming applications existing in the market. They have also focused an extreme level of effort on their branding for their targeted customers. Therefore, the threats of substitute items are high for Spotify.

(Source: Sletten, 2021, Musgrave and Leisewitz, 2022, Meyn et al. 2022)

Porter’s Genetic Strategy

By using the four aspects of this model, any company can take the appropriate aspects which helpful for the business to improve its performance. The improvement of the performance works as a parallel aspect for the product or service development in the high level of the compitative market.

Porter’s Generic Model

(Source: Pfenning and Eigner, 2020)

Cost Leadership

When referring to business strategies, the term "cost leadership" denotes the establishment of competitive advantage for the company by having the lowest overall operating expenditures in the industry. This may be accomplished by having the lowest overall operating expenses (Ramos, 2022). Spotify employs an innovative strategy in which it works to keep its costs as low as possible in order to accomplish its twin objectives of achieving a competitive edge and broadening the area of its strategic targeting.

In addition, a comprehensive strategy is used in an effort to broaden the scope of Spotify's internet user base. To put it another way, the company's objective is to make available, as quickly as possible, songs are drawn from the widest possible range of musical styles. If Spotify keeps coming up with innovative methods to build brand awareness and pleasure for its customers (Musgrave and Leisewitz, 2022), then the company's future prospects seem to be much more promising than they already are. Currently, Spotify is the most popular music streaming service that is available.

 Subscription Growth of Spotify

(Source: Bertin, 2022)

Differentiation

Differentiating a product or service is making it stand out from similar offerings made by competitors while also making it more appealing to consumers. Spotify takes a broad differentiation generic approach to its business model. This strategy involves the delivery of a wide variety of music that is appealing to a large group of listeners, as well as the differentiating, practise of providing customers with individualised playlists and music recommendations (Stetler, 2022).

The music streaming business receives a strategic advantage from maintaining a low-cost position since doing so makes the price of services more attractive to customers in international markets. Network effects make the online platform for the distribution of digital content that is Spotify more desirable to both artists and consumers as its user base continues to grow.

Cost Focus

In the Pricing policies, Spotify is superior. It offers ad-supported services for which it does not charge users in return for selling advertisements on its platform (Musgrave and Leisewitz, 2022). Additionally, the company offers premium services for which consumers must pay a monthly membership fee.

Differentiation focus

By offering a wide selection of music that appeals to a large audience and distinguishing itself by providing clients with customised playlists and music recommendations (Musgrave and Leisewitz, 2022), Spotify employs a broad differentiation generic strategy.

Marketing Mix

Spotify is considered the future of the music industry as well as an online streaming service too. It has been measured that the marketing approaches of this platform play a huge role in attracting listeners around the world. These are the following marketing mix (7Ps) strategies of the company.

7 P’s

• Product: Online music streaming is considered Spotify’s major product. The music available on this online streaming platform is free and they also can get a subscription which will provide a number of facilities to the users. The listeners can access this particular music platform on their android as well as computer devices too (Koutonen, 2020). These music platforms offer different categories for users according to their preferences in music. It has been measured that premium accounts are also obtainable and the users also will be able to download the music from this streaming platform and can listen offline whenever they want. This streaming platform increases the experiences of the music listeners and they can select their choice of music and also can circumvent ads if they want to.
• Place: Spotify is headquartered in Stockholm; Sweden and this company offers online music worldwide through its official website. It has been reported that this music streaming company is operating in 184 countries around the globe. In fact, the company also launches its service in 80 completely new markets in Africa, Asia, Latin America and Europe (Amalina, 2019). Assessing the annual report in 2021, it has been measured that the foremost market based on the profitability margin for Spotify is the United States. It is indeed true that Spotify's online streaming makes content more available to users across the globe with the help of the internet. Social media is also considered the best place for the company to reach down to its customers quite effectively.

• Price: The present pricing strategy to establish the price level which follows is a viable based pricing approach. This is due to the data on competitors being simply available regarding the fact of having a huge number of competitors which exists within the industry (Koutonen, 2020). It has been measured that Spotify provides the users two options: listening to their online content for free or paying a subscription fee which might be negated at any time on a premium account. In the case of the free users, it is essential for them to listen to ads every few songs which will provide profits for Spotify. The company has implemented several pricing approaches for monthly users regarding subscriptions. There are four types of pricing models available which are – (Family/$14.99), (Duo /$12.99), (Student /$4.99) and (Individual /$9.99).
• Promotion: It is considered the period of digital marketing as well as social media channels which have also turned out to be the foremost marketing areas for businesses of all sizes. Spotify utilises various social media platforms to bolster its marking efforts, advance brand awareness and drive developed user engagement (Natchakorn, 2022). Considering the social media platforms, Facebook is the major social media platform through which it has been able to make in excess of 23 million followers. The company has a strong relationship with the social media channel Facebook and shows several ads in the sidebar as well as on the subsidised posts on the operators' feeds. Moreover, the company also has a remarkable presence on other social media channels such as Instagram, YouTube and Twitter.

Spotify consist of a diverse approach for the promotion and the initial marketing approaches are considered responsible for gathering a huge amount of traffic on this platform. Each and every year the streaming company alters their marketing strategies for their targeted customers (Nugroho et al., 2022). It has been measured that Word of mouth also played a huge part in the progression of this online streaming platform. In the meantime, of its US launch, free Beta testing was considered an innovative way to draw the attention of consumer's attention as well as potential new users.

• People: The employees are considered the foremost asset for any company and similar to Spotify they also put an immense focus on their employees to enhance their organisational performance. Through sustaining a major focus on employee encouragement and motivational factors, this online streaming platform is making a productive workplace atmosphere which is indeed necessary for their retention (Yulianto and Oroh, 2021). In fact, providing impressive salaries and fulfilling their every expectation is key to the company's success and an increasing number of workforces. The 2021 report reveals that each year the number of employees in this company is rising and it can be said that the strategic approaches taken for retaining the employees are definitely innovative. Having a strong human resource, Spotify has been able to increase its organisational performance quite effectively.
• Process: Spotify also ensures the fact that all workforces are knowledgeable and well trained. Thus, they will be able to effectively take part in the operational procedures quite effectively. In fact, this will directly impact the providing extensive quality and sustaining standards (Natchakorn, 2022). This online streaming platform is actively tangled in researching market prospects in order to comprehend basic customer requirements. It also progresses understanding regarding user fulfilment through feedback gathered at the store, its customer service or social media websites. Moreover, the construction of the online portals is also measured to be facilitating for Spotify to build a substantial backup for the managerial procedures of the company.
• Physical evidence: Spotify is a completely digital platform offering online music content to users. Reportedly, it has been analysed that a large number of users are now acquainted with this online music platform across the globe (Vonderau, 2019). Regarding this fact, it has been considered the major aspect of the sales as well as digital services for Spotify.

Impact of the Theories on the Company

Impact of Porter’s Five Forces

To assess the impact of the theories that have been highlighted in this paper it can be stated that Spotify has been one of the leading brands in the given industry. To determine the competitor analysis the company initiated to make use of competitor analysis which has helped the company gather information about its primary competitors of the company. Having used this theory of analysis the company has been able to determine the factors through which the bargaining power of the buyers to drive down the prices of the services provided by the company is found (Forte, 2022). The key competitors of the company like Amazon Music, Tidal, Apple Music, Pandora, etc have been adopting means to set the market with heavy competition. Having used this theory the company has also been able to be aware of the price sensitivity that is prevailing in the market.

Marketing Positioning Statistics

(Source: Gomes et al., 2021)

As the company is found to be in the first position before Apple Music thus it can be stated that the competitive power of the rival companies is higher. The music industry has a higher potential to flourish in the market and has been able to create greater growth opportunities for the company (Gomes et al., 2021). With the help of this analysis, the company has been able to gather information about the competition and thus has been able to strategic ways so that the company can have the upper hand over its competitors. The company has also been able to determine the potential that the new entrants have in this particular industry based on which the company has been able to form various stages of the analysis.

One of the primary factors that were required for the company to be aware of was to gain knowledge about the bargaining power of the customers so that they can plan accordingly to reduce the threat that the company had in terms of the service provided by the company to the customers (Lindqvist and Otieno, 2021). Michael Porter’s Five Forces Analysis has made the company step ahead of time by having considered the specific areas of marketing so that the company gets to identify its strengths and opportunities in the target market. It also helps the company to be aware of the actions of the competitors so that it can have an idea about the threats that it might have to face in the near future.

Impact of Porter’s generic model

As the aim of the paper is to address the strategies and the processes used by the company for its brand management thus various types of models and theories have been used to identify the strategic approach of the company along with the brand positioning. However, as Spotify uses Porter's generic model it has benefited in various ways (Eriksson et al., 2019). Porter's generic model is considered to be an important tool that not only enables the company to manage its growth in the target market but also helps the company to think of new ideas to gain profitability so that it can maintain its sustainability in the competitive market. The company has been able to able to determine the entry barriers that it has before having entered the potential market. The company has also been able to be familiar with the power of the buyers which has further enabled the company to come up with effective ideas so that they can offer something new and unique to the customers.

Furthermore, it can be found that the company after having used this tool has been also able to achieve the ways in which it can have cost leadership. This tool will also further help the company in the future to boost its market share and lower the cost of the company in the process of operational management (Almeid and Espinheira, 2021). This tool is also known to have greater supplier power which further helps the company to create average prices for the customers. This model will also help the company measure the threat that it has from the substitutes in the competitive market. Thus, having used this model the company can gain many more advantages that will further help the company to strengthen its position in the target market by having boosted the company's share.

Impact of Marketing Mix

The marketing mix is one of the theories that help a company determine the market position by having considered all the key factors of the marketing strategy. In the above description, seven P's of the marketing mix have been mentioned, each P stands for the factors that are required to be determined the core aspects of the brand positioning (Livermore, Van Dyne and Ang, 2022). It is known to have boosted the company's effectiveness in the market which further helps the company to have a greater return on the amount that has been invested. It also has helped the company to establish insights that are useful for the growth and development of the company. The investment of the company in the marketing mix strategy helps it by having benefited it with future trends and variables. It also ensures that the company gets to manage and allocate the budget of the company effectively without compromising the quality of the service.

The marketing mix strategy helped Spotify to reach out to the target audiences having explored various platforms and exposing the company to the audiences so that they can be aware of the advantages of the services provided by the company (van de Haar, Broberg and Doshoris, 2019). It has also helped the company to understand the needs and requirements of the customers so that they can make the necessary changes within the company to facilitate greater service to the audiences. It also ensures that the company gets to showcase the availability of the brand on various platforms so that the brand positioning can be hiked. It also helps the company in its promotional strategies so that the company can use these strategies further to draw the attention of the target audiences. Thus, by having used this strategy of marketing mix the company can boost its brand positioning as well as look after its profitability.

Conclusion

To conclude the above assessment, it can be highlighted that in this part of the assignment the paper has tried to put forward a thorough understanding of the theories that can be applied by Spotify to boost its brand positioning. The papers have highlighted various theories and have explained each theory adequately so that the readers can gain in-depth knowledge about the theories and their impact on the chosen company. The sources through which the company can increase brand equity have also been provided in this paper. As there are many factors that are taken into consideration for brand management thus this paper has primarily focused on identifying the patterns that are used by the company to manage its strategies. The paper has also elaborated on the ways that can be adopted by the company to maintain its sustainability in the target market.

References

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Bertin, K.D., 2022. Spotify: A Strategic Analysis of its Strengths, Weaknesses, Opportunities, and Threats.

Eriksson, M., Fleischer, R., Johansson, A., Snickars, P. and Vonderau, P., 2019. Spotify teardown: Inside the black box of streaming music. Mit Press.

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