Beatrice+Mac+Micheal

Report on H&F MP3 Users Satisfaction and Market Recognition

1. Introduction

1.1 Background

It has been three years since our H&F MP3 entered the local market. In light of the decline in market share

during the past year, from almost one quarter to only 13%, compared to the most powerful competitor

iGADGET who has a very stable market share of about 50-60%, it seems necessary to examine the reasons

behind it.

1.2 Purpose

This report aims at discovering the difference of customers’ views towards H&F MP3s and iGADGET MP3s in

three aspect s:, which are product design, functions, and headphone quality. By understanding the customers’

preferences, possible improvements could be made to make our MP3s more favorable, and hence enlarge our

market share.

2. Procedure

The findings for this report are based upon market research carried out with customers by M&D Market

Research Company by means of questionnaire. A total of 200 H&F MP3 users and 200 iGADGET MP3 users

were involved and asked to evaluate the two brands MP3s in six aspects, namely design, functions, sound

quality, battery life, headphone quality, and overall satisfaction. (Market share data?)

3. Findings

It is clearly shown in the questionnaire result that customers have a lower satisfaction level towards H&F MP3

players than iGADGET MP3 players, mainly in four aspects. (3 aspects and market share)

3.1 Design

Less than half of the customers are contented with H&F MP3 product design, as opposed to iGADGET, which

has won the majority of the respondents’ satisfaction. A possible explanation for this is that the most designers

in our company are transferred from the U.S headquarte rs, who do not have the advantage in capturing the

local market’s fashion taste. However, iGADGET’s designers are more familiar with the local market.

3.2 Functions

More than 60% of the respondents expressed dissatisfaction with the function of H&F MP3 players, while only

around one third of users were disgruntled with that of iGADGET MP3s. This is probably because the tedious

process of transferring files from computers to H&F MP3 players, where additional software has to be installed

in computers. By contrast, iGADGET’s MP3 players just use drag-and-drop, which is much easier for users. A

further explanation could be the fierce competition from other products, such as iPhone4, which are equipped

with MP3 function. The implication is that consumers tend to favor products with multi-functions and easy use

steps.

3.3 Headphone quality

Over two thirds of the users indicated their discontent with H&F MP3 players, compared to just over half of

iGADGET MP3 players. This may be attributed to the production location selection. Malaysia has lower labor

cost, but also lower expected quality, compared to Korea, where iGADGET MP3 players are manufactured. (but only slightly higher satisfaction?)

Lower headphone quality could have very negative influence upon consumers about our brand.

3.4 Declining sales

The sales of H&F MP3 players have been declining steadily for the past few months. It seems that the

promotion celebrity does not appeal to the young generation. As a result, H&F MP3 players are losing the

young market segment steadily.

4. Conclusion

The findings clearly indicate the main sources of dissatisfaction for H&F MP3 player users are design, functions,

headphone quality, and old-fashioned celebrity. In order to boost market share, immediate measures should be

taken in the four aspects mentioned above.

5. Recommendations

5.1 Design

Given that the major cause of low satisfaction with design is unfamiliarity of the designers, it is recommended

that the company hires more local designers and provides more training to existing designers on local fashion

tastes. (what are local tastes?)

5.2 Functions

Our findings have suggested that the tedious function of MP3 players has a bad effect on customer satisfaction.

In view of this, it is suggested that the technical team should develop an advanced system which enables users

to transfer music files in one step. Furthermore, other functions could be added to MP3 players, such as quick

recording and photographing.

5.3 Headphone quality

In the light of the low satisfaction level with headphone quality, it is proposed that a revised quality control

system should be built in the manufacturing plant. With a stricter quality standard and checking system, better

quality could be expected.

5.4 Declining sales

Since the celebrity seems a little old-fashioned for the young, it would be better if we can have a younger

spokesperson, who appeals to the young more, in the coming promotion. This will probably help capture a

larger market share among the young people. (which celebrity do you recommend?)