Consumption patterns, digital technology and music downloading

As today's digital technologies modify the ways in which cultural goods are consumed and produced, the analysis of consumption patterns becomes one of the most important activities for producers in the cultural industries. Information on consumers' behaviour becomes a strategic resource with which to anticipate competitors and improve the fit between supply and demand. This article contains an empirical analysis on the music industry, where analysis of on-line survey results show that music downloading is not a unique phenomenon and consumers are approaching the digital environment in different ways. The presence of these differing consumption profiles entails a deep segmentation strategy, requiring that both sides of the strategy - from selection of artists to promotion and pricing policies - be addressed to deal with this segmentation. Managers working in the cultural industries will have to face fundamental changes associated with the shift to a world without physical artefacts, and will need to be able to predict emerging consumption profiles in advance and prepare mixed strategies to handle the period of transition. (C) 2003 Elsevier Science Ltd. All rights reserved.