Essays on Retention and Acquisition of Customers in the Music Streaming Industry - Deezer Case Study

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The paper "Retention and Acquisition of Customers in the Music Streaming Industry - Deezer" is an outstanding example of a marketing case study.   The music streaming industry is among the modern-day industries tremendously affected by the increased internet and mobile innovation. Indeed, during the last half a decade, the industry has become among the fastest-growing ventures, as it has continually adopted innovative and more advanced policies to attain competitive advantages, bring in technological vitality, as well as offer subscribers beneficial services across the globe (Hennig-Thurau et al, 2010). An example is Deezer, a French music-streaming service. Current media reports show that Deezer has recently been embroiled in rigid competition with popular and already established video and music streaming companies like Spotify, Apple Music, YouTube, and Tidal (Godeau 2015; Lunden 2015).

In 2014, the company ventured into the American market. Deezer's strategy has concentrated on global expansion and is currently accessible in 180 countries (Godeau 2015). The stiff competition in the American market led to huge losses of approximately $86 million in the third quarter of 2015 due to the difficulties to acquire and retain customers, as companies like Spotify, Apple Music and YouTube already command a large market share in the United States. It is suggested that Deezer will have relied on the concept of relationship marketing, due to the concept’ s potential to acquire and retain customers (Lunden 2015).

Current scholarly evidence on the real effects of relationship marketing has provided convincing results indicating its potential to acquire and retain customers over the long term. According to Suphan (2015), a major component of marketing during the 21st century has been to promote relationship building between a business and its body of customers.

The concept of relationship marketing is not a totally new concept. Instead, it is a paradigm that has evolved over time based on traditional marketing practices. It is argued that the concept of relationship marketing (RM) has the potential to improve Deexer’ s profit potential particularly in the United States. It is based on this rationale that this paper provides a review of literature on the concept of relationship marketing with a view of establishing its potential to attract and retain customers for Deezer. Nature and definition of RM From a review of literature, it is established that the chief purposes of relationship marketing are to create and enhance customer relationship from the outset in order to satisfy and retain a company’ s current customers (Sheth 2002; Shajahan 2006; Nakhleh 2012).

Undeniably, it is based on this assumption that the definition of relationship marketing is developed. Hennig-Thurau et al. (2010) view relationship marketing to be a variant of marketing created from direct response marketing campaigns that stress retention and satisfaction of customers, instead of concentrating strictly on sales transactions.

What this show is that, rather than concentrate on expanding its sales transactions, Deezer will need to refocus its efforts on creating direct response marketing campaigns that call attention to retaining and satisfying customers. Consistent with this view, Rahman and Masoom (2012) argue that relationship marketing is different from other marketing types, as it lays emphasis on the creation of long-term value of customer relationships by extending communication further than just using sales promotions or intrusive advertising.

Reference

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Arnold, T., Fang, E. & Palmatier, R. (2011). The effects of customer acquisition and retention orientations on a firm’s radical and incremental innovation performance. Journal of the Academy of Marketing Sciences 39, 234–251

Godeau, L 2015, “Deezer prepares for battle in competitive music streaming sector,” PhysOrg, viewed 30 Nov 2015,

Hadush, D. (2005). The Role of Customer Relationship Marketing on Customer Retention: A case of Ethiopian Insurance Corporation in Mekelle Branch (Tigray). Retrieved:

Hennig-Thurau, T., Malthouse, E., Friege, C., Gensler, S. & Lobschat, L et al (2010). The Impact of New Media on Customer Relationships. Journal of Service Research 13(3) 311-330

Kanagal, N. (2004). Role of Relationship Marketing in Competitive Marketing Strategy. Journal of Management and Marketing Research 2-17

Lunden, I 2015, "Loss-Making Music Service Deezer Postpones $343M IPO, Citing Market Conditions," TechCrunch, viewed 30 Oct 2015,

Nakhleh, H. (2012). The Relationship Between Customer Relationship Marketing Tactics, Relationship Quality And Customer’s Loyalty In Mobile Communication Industry. Academic Research International 3(2), 538-547

Rahman, A. & Masoom, M. (2012). Effects of Relationship Marketing on Customer Retention and Competitive Advantage: A Case Study on Grameen Phone Ltd. Asian Business Review 1(1), 97-102

Shajahan, S. (2006). Relationship Marketing: Text and Cases. New Delhi: Tata McGraw-Hill Education,

Sheth, J. (2002). The Future of Relationship Marketing. Journal of service Marketing 16(7), 590-592

Süphan. N. (2015). Customer Relationship Management Strategies in the Digital Era. Hershey, PA: IGI Global,

Thorsten Hennig-Thurau, T. & Hansen, U. (2013). Relationship Marketing: Gaining Competitive Advantage Through Customer Satisfaction and Customer Retention. New York: Springer Science & Business Media

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