Tag Archives: Music industry

General

Spotify, claim your leadership position now

The Spotify app for music streaming launched already back in 2008. For the majority of consumers, Spotify is still synonymous with Music Steaming.

The growth of Spotify in terms of subscribers is very impressive and in line with the uptake of 3G/4G data contracts and interest in ‘music as a service’ in general.
– 2011: 2M paying
– 2012: 15M free, 5M paying
– 2013: 18M free, 6M paying
– 2015: 55M free, 25M paying
– 2020: 133M paying

When looking at Google Trends data it is clear that very little people search for the product category “streaming music or streaming songs”. Instead, people search directly for the brand Spotify.

The insight:  the brand Spotify in the minds of consumers truly equals the category. What a wonderful position to be in!

Of course, the world changes, and like in every successful category competition comes in.  Besides Spotify, we now see players like Apple Music, TIDAL, Amazon Music, Youtube Music and Pandora (US only).

 

And while the fight is massive, with huge lock-in advantages for Apple and Amazon we still see that Spotify is leading the category (source: MidiaResearch)

  • Spotify: 36%
  • Apple Music: 18%
  • Amazon: 13%
  • TIDAL: not disclosed – part of  “the other” category at 11%

The market research results are in line with what we see in Google Search volume:  the clear leader is Spotify .

With all the new and very powerful competition, the overall marketing of “streaming music” grows and more and more people get interested.

The question is: who benefits? is it the perceived leader or the company doing all the marketing? It turns out, so far Spotify is benefitting. A Reuters technology news item from 2016 proved the point “Spotify says growth has quickened since Apple Music’s launch”.

There are two reasons for this:
1) Spotify remains to have the pioneering advantage – consumers know more about it and other services have not yet proven itself completely.

2) Consumers simply think “if Apple/ Youtube/ Amazon are active in streaming then (the leader) Spotify must be really good” and they default the purchase to the category leader. Consumers showed similar behavior during the famous Pepsi vs Coca-Cola challenge, also here the leader benefited.

 

Fast Forward to 2020…. 

Today we see many new streaming consumers, all people who do not know anything about the early days of streaming and might not have a perceived leader at all – they just go for what is most convenient “because they are all roughly the same anyway”

And looking at the brands in the App Store it seems they just don’t want to differentiate – at all!

Below are the descriptions in the App Store – try to find the differences or reasons to download one app over the other…

Spotify: Music and Podcasts
Discover the latest songs

Apple Music
60 million songs. All ad-free

TIDAL Music
Hifi Songs , Playlists & Video

Amazon Music: Listen Ad-Free
Stream & Download New Songs

YouTube Music
Stream Songs and play videos

 

Below is my attempt to position each app stronger by focussing on their strengths – helping consumers to navigate and make a choice.

Spotify: Music and Podcasts
The #1  streaming music app

Apple Music
The worlds biggest ad-free library

TIDAL Music
High fidelity sound, hi-def video

Amazon Music: Listen Ad-Free
Stream for free with Prime

YouTube Music
The #1 in music videos

 

In order for Spotify to keep their leadership position in the years to come, they will need to claim the position and live up to it – externally and internally.

Only then consumers who are in the market to spend money on streaming will be able to choose the leader because after all,  it is only the leaders who have followers.

 

General

Manage your brand like a band

There is a lot to learn from the music industry. It is a business that has gone through a lot of change ever since it started, yet it has a consistent approach in managing their superstars: the brands of the music industry!

The below lessons can help you to look at your brand differently or give you a different perspective. Have some fun while pretending you are managing your brand as if it were your number one band!

 

Lesson 1: A good story sells
Remember T.A.T.u? Profiled as lesbian singers causing controversy when kissing on a music video. It worked. A lot of press brought T.A.T.u. to the attention of many, resulting in singles and albums that were selling very well.
When it turned out the singers of T.A.T.u. were not lesbian things started to go downhill for the band. A good story sells, but it better be a real one.

Ask yourself: what is the story of your brand? Do you have one? Is it real? Is it personal?

Lesson 2: Never lose focus
Singers and bands all have unique styles. Their styles are their product categories and differentiation. When you hear on the radio your favourite brands, eh bands, you need only a couple of seconds to recognise them! It is the power of brand familiarity.

You will not see successful artists changing styles. Imagine the techno artist moving into classic or the rock band becoming a euro dance band? While many artists could do many different things they have learned that if they become everything to everyone, they will become nothing to no one.
Ask yourself: is your brand focused or does it mean many different things to many different people? Is there an opportunity to focus?

Lesson 3: Grow around your core
Artists grow, they modernise their style, they adapt to society and new trends. Growth is always natural and never radical. Think about Madonna, growing her brand by catching trends and expressing them in her own unique style.

Ask yourself: how has your brand grown? Have you stayed consistent or moved in many different categories? How do your consumers / customers really see you?

Lesson 4: Familiar but new
The music industry is a master in pushing new versions of the same songs. Think about all the special mixes, never heard before versions, live concerts, remixes, remastered versions, versions with booklets, ultimate editions and more.

Even bands that do not exist anymore still keep selling new materials. For example, The Doors released six studio albums, their last official album is from 1971. This does not stop them from pushing out new materials even as recent as last week!

The keyword here is New. After all, people are interested in New and buying New.

Ask yourself: do you clearly market new features or functionalities as New? Are they the main story in your marketing?

Lesson 5: Styles go out of tune
Music styles go out of tune. For example baroque music, once super popular, it is now a real niche. The same is happening to brands. Today’s popular product categories with popular brands will turn – over time – into a niche or simply die. Think MP3 music players, vinyl albums or CDs.

Ask yourself: in what business are you really in?

This post appeared in Markkinointi & Mainonta