An unstoppable trend in recent years has been the rise of online streaming services. What effect has this had on CD and DVD sales? Steve says, ultimately, his company has benefited.
“I often say that without this dynamic, musicMagpie arguably would not have existed, or certainly wouldn’t have grown to the extent it did in the early years. It was the market shift of some people migrating to digital solutions for both music and film that meant they were ready and willing to sell their old physical collections to us, which provided the product for us to refurbish back to ‘as good as new’ condition and resell.”
Steve admits that streaming has accelerated the decline of “new condition” product sales in the last couple of years. But adds that it nevertheless remains a £3bn market in the UK, pointing out how it has ‘seen off’ chief download disruptor iTunes, which recently announced it was closing its online pay-per-content store.
“We very much believe that the key concept here is that this is not a clear case of ‘either / or’, as a lot of people still enjoy doing both. Music and film are hobbies and a passion, not a commodity, and the robustness of both physical books and vinyl are interesting examples of consumer choices reverting back to previous formats.”
“The final point I would make here is that there’s a new and very interesting dynamic about to enter ‘streaming’ world on TV and Film where the market is about to fragment even further with the launch of the Disney streaming service and the new ‘BritBox Best of BBC and ITV service’, where consumers will be asked to fund more and more different subscriptions to access all the content… will this further push people back towards physical product?”
Spreading its wings
Nevertheless, about five years ago the company diversified into consumer electronics, to support the recycling of mobile phones and games consoles. Steve says the move was necessary to future-proof the business.
“While everything I have just said about physical products is true, we did need to evolve the business and future-proof it into a category that was much more enduring and longer term,” explains Steve.
“This has been led by the mobile phone category and we are very proud to have become the biggest and voted the best mobile phone recycler in the UK in the last two years and we are very much aiming to replicate that in the US.”
Steve says that part of the secret to musicMagpie’s success is how the company has cultivated a strong relationship with the millions of users who have registered over the last 11 years.
“Having earned their trust and respect, it is our job now to leverage that trust into other relationships with other product categories.”
The launch of the musicMagpie app, designed to facilitate customer communication, was a landmark innovation for the company and one that enabled them to quickly win the trust of new customers.
“Like many other apps, we absolutely aspire for our app to make life easier for the consumer to deal with us, whether buying from us or selling to us,” says Steve.
“Historically, the app was a huge leap forward for us, as it enabled users to scan barcodes using their camera rather than typing them in – a process which was laborious and slow.
“Even now, I would describe it as a critical business tool and one that so many consumers turn to first to interact with us.”
Addressing the big question of what the future holds with respect to eCommerce, Steve says that one thing is for certain – it is only going to continue growing in size and become more important to sellers of all stripes.
“People now demand total trust from the sites they are buying from (or selling to!) and not just the cheapest price. So, anybody who is involved with eCommerce has to focus more and more on gaining that trust from consumers from the first instance that they arrive on your site to the last moment of they experience your product or service. Businesses must be fanatical about every aspect of customer service on that journey, as it is absolutely critical to success.”