According to informed sources who spoke to the Financial Times, the number of subscribers to Amazon Music Unlimited increased by around 70% in the past year.
Amazon had more than 32 million subscribers to all its music services, including Unlimited and Prime, in April. And while that is dwarfed by Spotify’s subscriber base of 100 million, Spotify’s growth is reported to be much lower at about 25% a year.
“Amazon is the dark horse [in music],” said Mark Mulligan, an analyst at Midia Research. “People don’t pay as much attention to it [as to Apple and Spotify], but it’s been hugely effective,” he added.
Although relatively late to music streaming – Amazon Music debuted only in autumn 2016 – it appears the e-commerce giant is succeeding partly because of its brand recognition. But its competitive pricing structure as well as the popularity of the Alexa voice assistant are also contributing to the rapid growth of subscribers.
Amazon Music retails at $10 a month – the same as Apple and Spotify services – but the cost drops to $8 a month for Amazon Prime members and to just $4 a month for people who listen only on an Echo speaker linked to an Alexa device.
“[Amazon] have gone all in on [music],” an unnamed senior music executive at a major record label told the Financial Times. “We see high engagement on their service.”
And of particular note for marketers, analysis of Amazon’s music streaming user base shows that the company attracts a much higher proportion of older consumers than rival services.
About 14% of subscribers to Amazon Music are aged 55 or older, compared with just 5% of Spotify’s customers, while Amazon Prime Music has gained a strong foothold among consumers aged 45 to 54.
“We’re not battling for the same customers as everyone else,” said Steve Boom, head of Amazon Music. “For the industry to reach its full potential, we can’t just look at 15- to 22-year-olds.”
Sourced from Financial Times; additional content by WARC staff