Spotify to Launch a Redesigned App That is Optimized for Advertisers
Spotify recently became a publicly traded company. Now that stocks are available, it is more important than ever for Spotify to prove its worth to potential investors.
It has been somewhat of a mystery as to how the company managed to continue operating with a deficit of $3 billion. Spotify reported that much of this loss was due to the significant costs of licensing content streamed through the app.
Leveraging Current Assets
At this point, leaders within Spotify are attempting to leverage Spotify’s current technology and large user base to create meaningful insights through the redesigned app for advertisers. Such resources include:
- Large audience: Spotify reports an active user base of 157 million users. Of these, the platform reports that 71 million pay a monthly subscription to stream their music free of ads.
- Highly sophisticated algorithm: Spotify has made significant investments into machine learning. This expense is meant to improve the connection between Spotify and their users by suggesting songs or playlists that peak the user’s interest.
- Data Saver: A new feature to this updated version of the Spotify app is the Data Saver. This feature stores all kinds of data on specific users as well, which can always be leveraged to assist in digital marketing efforts.
- Simple creative: Digital marketers will not need any sort of training on how to advertise within the Spotify platform. All of the current video, audio, and display ads will remain unchanged so that campaigns are easy to set up and optimize.
Spotify has proven their potential. Now it is time for them to execute a perfectly planned strategy in order to capitalize on advertisers’ desires to reach target consumers. The platform’s rapid growth and machine learning advancements are their core competencies, which will need to be exploited in the near future in order to maximize potential profits.
Spotify’s global head of partner solutions, Danielle Lee, explained the platform’s current strategy in an interview with Adweek by saying, “We’re consulting our advertising partners on how to deliver a more relevant experience—even thinking about audiences that they didn’t know [about]. It’s not enough to find the right person, but to find them in the right moment where they’re going to be most receptive to your message.”
As a digital marketing specialist from Onimod Global, I personally feel that the future looks quite bright for Spotify and its investors. However, I think it is also entirely possible for the platform to quickly sink itself with ineffective strategies. If Spotify can come up with a plan for success that amplifies their greatest strengths while minimizing their current debt, then they just might be able to come out of this on top.