Assessing the Application of Pricing Strategy in Audio Music CD: Empirical Study on Ethiopian Music Industry

Abstract

Even if the world music CD market is at the maturity stage, Ethiopian audio music CD market is on its growth stage where the sale of audio music CD is booming from time to time leaving only some stakeholders benefit from this growing industry. This study assesses the overview of the Ethiopian audio music CD market, specifically, the kind of audio music CD pricing strategies that firms adopt and a discussion of the various factors affecting the adoption of these strategies. It is also assesses the relationship between the three key elements of the pricing decision under an integrated framework: the pricing strategies adopted by a firm, the pricing objectives that these strategies are meant to achieve, and the pricing strategy determinants that can influence the firm’s choice of pricing strategies for an audio music CD. For the purpose of assessing the application of pricing strategies on audio music CD, a two stage random sampling technique was applied. The first stage involves purposive sampling of recording companies, music CD distributors, vendors, artists, and promotion and marketing companies out of the total business involved directly or indirectly in the marketing of music CD marketing. In the second stage, random samplings of 20 businesses were selected. Using linear regressions and correlation analysis, the relationship between pricing strategy determinant factors and the appropriate pricing strategies were tested. The findings reveal that there is a week relationship between the pricing strategy adopted by firms and the factors influencing pricing strategies.