It was a really purposeful and ambitious move from Spotify last week, to create a product so social that it is what iTunes could have done if, I’m going to say it, they hadn’t purely thought so commercially about their product. The new shareable Spotify lists, the connectivity with Facebook, and the ability to upload your playlists from iTunes isn’t simply an iTunes killer, its a market leading innovation.
I think this new move will see Spotify rake in the profit and these are the reasons why:
1) Creating shareable playlists means they can tap companies even further into your social graph. This means that companies can scrape your friends music feeds and playlists to say to you that your friends like something or listen to something heavily. It could even then cross-match this against other interests in your profile based on the use of Facebook like functionality. So I would like to be recommended music from my friends playlists from a brand… e.g. you like Florence and the Machine, so does your mate but he also listens to Delphic.. have you tried them? – a sponsored message from Polydor and Universal Island.
2) The Feeds add a really dynamic part to music sharing. What could be interesting here is that Spotify start to allow sponsored feeds from brands which match your listening habits. Essentially this is similar to the “like” function on Facebook, but wholly owned and sponsored by brands associated with Spotify. I guess a good example could be feeding a trailer for the next episode of Glee into someone’s Spotify feed who has been listening to the Glee soundtrack or singles.
3) This newly layered technology means that frequency of visit is going to be alot higher and therefore, loyalty will, I believe go through the ceiling. (I’m not sure what the actual definition is of “through the ceiling” but I’m sure its alot of visits) The more visits, the more value there is to advertisers. I’m not entirely sure what the current frequency of visit is but I am sure its not as high as Facebook (50% returning every day). However, combining Spotify and Facebook will push visits up. Advertisers can take advantage through sponsorships and tie-ins. To me the best example of this is still the Fiat 500 playlist, but I am sure we will see alot more advertisers take advantage.
So what else could Spotify do?
1) Add Like Functionality to all tracks. These would enable them and you to gradually build up a more in-depth functionality. It already pulls in feeds as stated above, so this would be a really interesting addition. (Anything liked is then automatically fed into your Facebook profile)
2) Embeddable Music Player. We have seen Twitter add embeddable tweets – I will be posting about this later. So how about Spotify create an embeddable music player. I would love to see an embeddable player which takes the full functionality of the new Spotify to my blog.
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chrispullon
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mattbambow
