Thursday, May 19, 2011

Leveraging the Long Tail – Spotify


Spotify was founded in 2006 by Daniel Ek and Martin Lorentzon. It is an online service that streams music to the users. The content has been free up until April 14 2011 when they had to put a limit on how many times and for how long the free users could listen to different songs. Airing advertisements supports the free version.
Spotify also have a premium service for paying customers that cost around 10$ each month. To that price the customers get unlimited access to the music and also can have the songs in offline modus. That means that they can listen to the music without having an Internet connection. They also get the opportunity to use the mobile application. Spotify have 10 000 000 free users and 1 000 000 paying users.





Spotify - The story


This weeks pattern is “Leveraging The Long Tail”, the phrase was made popular by Chris Anderson, and it describes the way internet sites now have made it possible to reach out to markets that was too small before. A great example is Amazon with their great variety of products in their store; they sell a little bit of everything and earn money. Do not just go after the trends, like Jason Watson said in his lecture about the pattern at QUT.


The long tail - The new marketplace


The web is not build up by just a few popular sites, now the niche markets also have has a place. It is worth to have a website when it is online and you can sell the products all over the globe, now companies can reach markets they could not before.

The best benefits from this pattern is:

  • Ability to target and capture new micro-markets
  • Content producers can reach a wider audience
  • Opportunity for increased consumer choice

Spotify is a great example of this since it uses many of the best practices for the pattern:

1. Build on the driving forces of the Long Tail

- Three forces drive this practice.
  1. More products – in Spotify this means more songs, by unknown and known artists. It is important for Spotify to have the best selection of songs so people go to their application to listen to music.
  2. More customers – by making more people use the application, more people listen to songs and by that making the songs more popular and again making “the tail fatter”.
  3. New market – with this Spotify is connecting supply and demand. This is made up by Spotify having for example a search function in their application that makes it easier for people to find the songs they want no matter how narrow the search term is

2. Use algorithmic data management to match supply and demand

This blends well in with point 3 of the first practice. This is used to help customers find products of similar interests.
The feature “Related artists” that the users get when they are on a page for an artists, helps the users maybe find some other music that they normally would not search up themselves.

Related artists

With the integration of Facebook as well in the application, makes it much easier to share music playlists and see what artists you have in common with other friends.

 Facebook integration

In the home screen of Spotify you also get a “news feed” that shows the latest posts from friends that they linked on Facebook from Spotify. Very cool!

News feed from Spotify and friends


3. Use architecture of participation to match supply and demand

By taking advantage by the huge number of users, the application uses the “wisdom of the crowds”. Spotify has song rankings, where people can give the songs stars, it also have “Top lists” that shows the most popular albums and songs in the world, or you can choose to just show for your country.

 Songs and albums ranking

Some issues with the pattern are that some markets benefit more than others. Spotify is one of those that do, since their products are digital and they do not pay so much money to develop and produce. But other stores can struggle more.

Spotify is only available in the following countries Finland, France, Norway, Netherlands, Spain, Sweden, United Kingdom. So you cannot use it in Australia yet, and as late as this article from 11 May 2011, Spotify says that they have no immediate plans to launch here. So Australians still have to wait to get this great service.

9 comments:

  1. Great post on Spotify! I discussed Spotify relating to software above a single device myself, this fantastic application applies to most of the patterns we´ve discussed.

    Spotify´s vast library is unique, truly leveraging the long tail!

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  2. Thanks for the comment, I can't live without Spotify really. And I am really sorry for the Australians that still has to wait for this application!

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  3. Great post. I've read a lot about Spotify and am hoping we'll get it over here some day!
    Great example of this particular pattern. Similar to Amazon's method, it looks like Spotify does a great job of suggesting new songs based on your preferences.

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  4. Great post Cecilie! I love Spotify, and how easy it is to discover new music and share it with friends. I find new bands all the time. Too bad it's not available here in Australia yet.

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  5. Thanks for the comments!

    With the uproar concerning that they took away the unlimited usage for the free alternative we will see how sought after Spotify will be now around the globe. But for us that pay for the service, I think we have a lot great things in store!

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  6. Great post on the pattern, the UI looks really good,great way to integrate social platform with the musite website.

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  7. I gotta favorite this website it seems very helpful . Spotify premium apk download

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  8. thanks for this usefull article, waiting for this article like this again. spotify

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    ReplyDelete