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Music streamers need segmentation

News, 20 March 2017
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HALIFAX, NOVA SCOTIA: In many respects, there is little to distinguish one music streaming service from another except perhaps their audiences – and they need to do more on understanding these.

"The single most important thing for the music services to understand (and to differentiate themselves) is to understand their user's passions and interests," according to Bryan Calhoun, Digital Strategy and Business Development for Artist Management Team at BPG/Maverick.

So Hannah Chapple, content and marketing officer at marketing intelligence platform Affinio, analyzed the US-based audiences – more than 3m people in total – of ten music streaming services to understand which resonated with different audience segments.

Using Affinio's proprietary algorithm, she came up with 20 interest-based clusters based on shared affinities, ranging from the general ('EDM fans') to the niche ('Teen girls who love parody')

So, for example, the analysis was able to show that iHeartRadio (39%) and Pandora (16.2%) claimed more than half of the audience of 'Teens Who Love One Direction & Bieber'.

Among 'General Pop Music Fans', the audience was split fairly evenly between streaming services, but Apple Music had a slight lead. In the 'Rap & Hip-Hop' genre, however, Tidal (35%) and Soundcloud (18.1%) stood out as favorites.

When she considered 'Gamers', Napster (23.7%), Pandora (21.3%) and Spotify (11.1%) claimed the greatest audience share.

"In order to win over the hearts and minds of new listeners and reduce churn, streaming services must align with the cultural identity of listeners and create enriched data-driven user experiences," Chapple stated.

"And if they don't," she added, "just remember, switching costs are low."

Given that many users follow their favourite artists and bands on social media, she recommended this as the ideal place to start mining data for actionable insights.

Data sourced from Affinio; additional content by Warc staff

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