Spotify on why it’s launching its first UK brand campaign now
Awareness for Spotify as a music streaming service may be high but it no longer sees itself as just that and is launching its first brand campaign in the UK to prove it.
Spotify has changed its marketing strategy in the UK.
Outdoor, digital and social are running this month to get that point across, each one working to elicit an emotional response from new and old customers.
Getting that kind of reaction is something the business hasn’t tried in the UK, though now is arguably the right time given the bulk of its sales last year came from subscriptions, according to the brand’s Companies House filing that Music Business Worldwide reported. If a significant chunk of Spotify’s fans in one of its biggest markets are willing to pay to use it, then it’s no wider it wants to mine some of that goodwill in order to shift perceptions of what it is.
From its rush into video content to having a tighter focus on playlists, the company wants to spotlight the myriad of ways its community can discover and share music. “We found ourselves in the hugely fortunate position of having a wealth of great stories to tell in the UK, and the time felt right to tell it,” explained head of consumer marketing in the UK, Karen Staughton.
One of those stories is the popularity of curated playslists. More than just a way to help people navigate their way through tens of millions of tunes, these playlists are point of difference in a market where every service more or less has the same goods. What’s more it gives Spotify an alternative to the exclusive album deals it deems a blight on the industry but are being used by Apple and Tidal to recruit new users.
“Spotify is becoming famous for the playlists that it curates,” added Staughton. “Whether the human-curated ones from our huge editorial brands like Grime Shutdown and Hot Hits UK, or the algorithmic playlists such as Discover Weekly and Release Radar. We wanted to celebrate playlists in all their forms, as they are at the heart of what makes Spotify special.”
Part of Spotify’s marketing shift is informed by data. Much like it has done in the US, the streaming service is using insights it has on its listeners to adapt its creative to local tastes. “Our community of users (and the data their behaviour creates) is one of our most amazing marketing assets,” said Staughton.
“We are in the enviable position of having a lot of interesting data to look at, which shapes the creative process with our agencies, and that creative process is really the major shift in how we work with them. We put data and community at the core of our creative and our media across all channels to tell the stories that connect us with our audience.”
Change to Spotify’s marketing was inevitable; the company’s commercial strategy has switched gears over the last 12 months as it looks to capitalise on a power shift in the music industry. Digital music revenues overtook the earnings from traditional music formats last year for the first time, according to an industry report. Consequently, Spotify has made been at pains to stress to media planners the value of using someone's streaming data to understand their mood alongside a push into original content. It is even considering buying fellow music streaming business Soundcoud, if reports are to believed.
For all the growth behind a technology platform that boasts 100 million monthly active users and over 40 million paying subscribers, question marks still remain over when it will make a profit. Revenue rose 80% to €1.95bn last year, while losses slid 10% to €173m. Despite this, the business maintained at the time of the financial report that its model supports profitability at scale and called 2015 “our best ever year”.