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It’s no secret that consumers are transitioning away from purchasing music in bricks-and-mortar stores and tapping the digital-download market. The numbers are starting to catch up with the trend, too: Apple announced last spring that its iTunes store, which dominates 70% of the digital- download market, had surpassed Wal-Mart Stores as the largest music retailer in the United States.

Increasingly, traditional retailers are looking to compete against the iTunes store. Best Buy, for example, recently acquired the online-sharing site, Napster. But Apple continues to lead the pack. Its success has everything to do with the company’s talent for innovation. By continually reinventing itself online, Apple gives shoppers more reasons to buy music online—and keeps them coming back for more.

In September, Apple introduced iTunes 8.0, the latest version of its interactive platform. iTunes 8.0 is by far the sleekest and smartest version in its repertoire, helped by its new Genius Sidebar feature that prompts consumers to buy more music.

The Genius Sidebar can create personalized playlists from an existing music library and recommend new music (available for purchase) to consumers based on their preferences.

These recommendations are based on song styles, not necessarily on the artist. For example, the tool can distinguish between Eric Clapton’s classic rock song “Layla” and his unplugged version, and recommend similar songs for the listener to buy based on which version they choose.

The Sidebar also highlights “Top Songs You’re Missing.” If an iTunes member is playing “Layla,” iTunes may discover “Wonderful Tonight” is missing from their library. It then gives them the option to download it for its staple 99? fee.

For the feature to be integrated, an iTunes Store account is needed, and necessary information about the user’s library must first be sent to the Apple database.

This is an easy process: A pop-up asks an iTunes user for permission to have their music scanned and sent to the company’s database. The scanning process occurs only once during the set-up process and takes less than five minutes. The Genius feature becomes smarter by compiling the anonymously submitted library information from its users, and over time, becomes more accurate with its playlist generation.

Once the songs are scanned and sent to the company’s database, Apple analyzes and matches users’ tastes with others. The company then pushes out recommendations that are displayed on the Genius Sidebar.

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