Spotify: A Personalised Marketing Genius
Between Black Friday and Christmas, around the end of November, Spotify reminds us how ahead of the game they are compared to other streaming services with the “Spotify Wrapped”. Through their personalised marketing campaigns, Spotify’s premium subscription rates grow year on year. But why?
Long-term customers are more valuable to a company’s growth than you’d imagine. Harvard Business School found that increasing customer retention by 5% can boost your company’s profit by 25-95%.
We’ve looked at the Spotify’s marketing just to see how Spotify masterfully retain customers.
Who is Spotify and What do they do?
Unless you’re not a music fan, you’ve probably heard or used Spotify at one stage in your life. Founded in Sweden in 2006, Spotify is a music/ podcast streaming service platform. They have growing customer retention rate despite the market becoming aggressive with Apple Music and Tidal coming onto the scene.
From Q1 2020 to Q3 2022 Spotify has grown from 130 million to 195 million premium subscribers worldwide. Spotify’s subscriber base has doubled since 2017.
Spotify focuses customer onboarding
In your Spotify journey, customer retention starts right at the beginning. Right from the start, Spotify give users a list of reasons to stick around by allowing users to use the app for free, although the premium subscription gives users more functionality as users can listen to music without ads, download music and skip songs.
Spotify pays close attention to their customers and like to remind you what they’re paying for and why it’s worth the money. Spotify engages with new customers and provides new customers with a branded email explaining all their features and benefits.
An effective onboarding programme shows the true value of Spotify’s product whilst making the customer feel welcome and wanted after they’ve made their purchase. A strong onboarding programme can help build your brand relationship with your user.
Spotify make their customer experience as personal as possible
They are customer focused obsessed. Spotify are pros at gathering data and using AI to create a more personalised experience for their customers through:
- Actively monitoring content that customers listen to on the platform
- Use listening insights to deliver personalised recommendations like concert tickets to your favourite artists
- Spotify recommend songs and playlists based on your listening history.
Spotify uses AI to highlight the right content at the perfect time for their users. Spotify focus on using AI to create a unique experience for each customer, built on their taste. Each customer gets their own “daily mix” playlist along with a weekly “Discover Weekly” offering customised recommendations based on their listening habits.
Spotify are experts at using their data to make their customers feel heard. It makes thinking about switching to another music platform impossible.
Spotify Wrapped: Share their experience
One of Spotify’s most valuable campaigns to keep customer retention and increase the brands awareness is their “Spotify Wrapped”. They use AI and customer data to create Spotify’s most popular feature. Spotify Wrapped gives their customers an insight into their year on the platform, giving customers a full report on their listening habits.
The animated reports create a sentimental factor and walks you down memory lane. It shows users their minutes listened, top artists, favourite genres and most listened to songs. As these reports are so unique and well created, users can easily share their results with friends and followers on social media, which helps the brands credibility with so much user generated content. The Spotify Wrapped helps Spotify enhance its brand presence, retaining customers and increasing their premium customer base.
Spotify is a prime example of how a personailsed customer experience can increase your brands retention rate whilst helping to boost your audience. Will you take some inspiration from Spotify,
The Zen Agency are specialists in integrated marketing campaigns. We can help businesses create a digital marketing strategy, content creation, social media marketing, PPC, SEO and videography.
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