India is a huge market and we believe that we debuted here at the right time, given the size and health of the music industry, the growing creator ecosystem, developing smartphone penetration, and evolving consumer segments. This makes India a critical market for us. Our aim was not to rush through our launch but ensure that we enter the market through a strong localized service that enhances the users’ music streaming experience. In terms of consumption, India is positioned to become the world’s youngest country by 2020, and that places an unprecedented opportunity for growth, primarily driven through the 18-35-year-old demographic. Combined with factors such as a maturing music industry, a growing creator eco-system, and an increasing balance between film and non-film/independent music, India is a critical growth market, and we feel that we are here at the right time and committed to grow the market.
Q] Given the number of existing music streaming apps in India, how does Spotify plan to make a difference?
Our strength lies in making relevant recommendations, and enabling discoverability across music genres, moods and moments. Through new music added every day, locally relevant curated and algorithmic playlists, and flexible pricing ranging from Rs 13 to Rs 1,189, we will continue to work towards the discovery of new music for local and global artistes in India. Globally, we are available in 79 markets, across 500 platforms and 200 hardware devices. In India, we noticed a great market for gamers who seek to amplify their gaming experiences through music, so we have Xbox and PS integrations; we are also integrated with Tinder, Google Maps and several other platforms and apps where music matters. We also have a robust podcast strategy globally, and while it’s still early days in India, we do see our value proposition, supported by the acquisitions we’ve made, position us ahead of the game in the Indian market too.
Q] How is Spotify’s free-on-demand mobile service helping to promote the brand in India?
Spotify offers free unrestricted, on-demand control for our price-conscious users in India, so they can access the latest tracks and over three billion playlists, as many times as they want. This is a first for Spotify on mobile, in any country, at launch. The free tier has enabled mass sampling of the service and we’ve seen above industry average engagement rates and time spent on the app. This, in turn, gives us more insights on how listeners consume audio content in the country, and localise further. The larger intent is to reduce piracy, and convert those users into legal streamers, contributing to the growth of the industry.
Q] In India, Spotify is also focusing on regional content... how important are the Tier II and Tier III markets, compared to metros in the country? Do you see more growth from there?
Based on the music streams for locally popular artistes, the ongoing increase in smartphone penetration, affordability in data, and the increasing awareness around legal music streaming, there is an unprecedented opportunity for growth that will come through Tier II and III markets. Additionally, we recently announced the Spotify Lite Beta in India, which is meant for those on low-end Android devices, patchy network, and have limited capacity on their mobiles, without compromising on the music catalogue.
Q] At a time when there is an ongoing debate about ad-free streaming and OTT platforms, how can marketers capitalise on music to advertise their brands to consumers?
Spotify is focused on an audio-first strategy, and this means opportunities for brands to be visible not just in music, but also in non-music audio content. In fact, the revenue growth in ad-supported audio streaming suggests that brands find relevance in targeting audiences on mediums they are most connected with. A good example is what Netflix has done on our India app, where the ad is extremely contextual and links back to the theme of their currently popular show, Leila. Globally, we’ve done research that shows high resonance for ads by users, in podcasts they listen to. So, the more relevant the brand outreach, the more potential there is.
Q] From the marketing perspective, would brands be able to target specific audiences using Spotify’s algorithmic data?
As digital natives, millennials are the first generation to have the world’s entire library and geography of music at their fingertips. That, coupled with the unparalleled ubiquity of audio, presents brands with limitless possibilities in engagement. Today, through our Spotify for Brands platform, we are helping brands explore new-age marketing opportunities through effective reach and resonance, basis depth in measurement products that help quantify the true impact of brand messages. All this, without compromising on the privacy of our users.
Q] Is Spotify looking at introducing video content in India anytime soon?
We already have vertical videos on our global app, but there are no such plans for India yet. As of now, audio is priority for us here in India.