How Spotify Is Betraying Its Vision, And Why It Will Harm Their Growth

Thoughts from a Growth Hacker with 87,510 subscribers on the platform — for real though.

Spotify’s Growth Driver

Actually, probably 87,511 followers in the brief moment you scrolled down. With such a big following you would say that I must be one of Spotify’s biggest advocates, right? Well I’m not. Not anymore. 

While one can argue that it’s their Freemium business model, their strategic invite-only roll-out in Europe or their blunt disruption of the music market that were the drivers of what now is a $8 billion valuation, one factor that definitely contributed to Spotify’s rapid growth is their notion that music is something to share, and they designed their service surrounding that vision.

Or how the CEO & Co-founder of Spotify, Daniel Ek, said it after their launch in the US in 2011.

“We believe that music is the most social thing there is and that’s why we’ve built the best social features into Spotify for easy sharing and the ultimate in music discovery. Even if you aren’t a total music freak, chances are you have a friend who is and whose taste you admire”.

To emphasise that belief, Spotify integrated Facebook with its service allowing people to sign-up with Facebook. Or actually, it forced new US users to sign-up with their Facebook account to get access to the free service. 

Whether this bold move was done out of their social stand described above or it was just a dirty trick to leverage an existing network (Other Peoples Network, one of the oldest growth hacks in the playbook), it worked. 

Whenever someone listened to a track on Spotify, their streams got posted on their walls. And it was there for all their Facebook friends to see. And to click. To Spotify, obviously.

This accelerated Spotify’s growth to near exponential and their Montly Active Users went through the roof.

While it’s up for debate whether such a strategy is customer-centric since it also got some inevitable backlash, their user experience illustrated that I was never alone on their service and that I was always among friends. From my big six foot buddy who listens to Celine Dion at 23:00 pm, to the introvert friend who plays new indie finds at 7:00 am. We all have them among us. Or had, at least.

Spotify’s Change In Focus

Had, because Spotify is neglecting the connections users have with one another. And while this may not sound as alarming as my tone of voice insinuates, I will explain why it’s even more alarming than that.

I’ll take my own situation as an example. It’s safe to say that I was an early adopter when it comes to using the streaming mogul. The 21-year old me in 2012 was obsessed with Electric Dance Music (EDM) and I decided to make a playlist for that genre. Through friends, and friends of friends who loved the playlist, I soon had a couple of hundred subscribers and along with weekly updates and some Spotify search optimisation I have what now is the second largest dance Spotify playlist owned by an individual.

I followed a lot of friends on the platform and vice versa, I got music sent to me by them and other users and I felt obliged to update the playlist weekly to feed my music buddies with fresh content. 

But since quite some time now Spotify shifted it’s focus from promoting user created content and user activity to pushing commercial playlist mainly owned by Spotify’s shareholders.

Unhooking Their Users

While it’s obvious they’re going for this move since it more-or-less makes sure Spotify decides which artist or track is played, it weakens their position in the long term: users don’t primarily follow other users or artists anymore, they listen to playlists curated by aggregate user data and royalty contracts. 

So where I always felt socially obliged to keep my list updated, I don’t anymore because all social connection is lost. I don’t know who is following me and I don’t have any interaction with them. And probably many other Spotify users feel the same.

The habit where people go to Spotify to discover and listen new music is getting a dent by this change of focus. Through Nir Eyal’s Hook Model, the habit-forming Bible, one can easily see how this is going to be a problem for the Swedish streaming service.

The Hook Model

The Hook Model illustrates the way behaviour can become a habit. A Hook is an experience designed to connect a user's problem to a company solution with enough frequency to form a habit. A Hook cycle consists of four stages: Trigger, Action, Reward and Investment.

Let me simply explain the Hook Model with Twitter as an example. In order for any action to happen, a person needs either an internal or external Trigger. In case of Twitter this can be through email or word of mouth or, if you are already a habitual user, through an internal emotion like boredom due to which you open the app.

Through this Trigger users will open Twitter and take the simple action to scroll through the feed. This action will give the users a reward. The reward needs to be variable in order to get people hooked, otherwise people stop using your product /service eventually because they already know their reward. The reward here is that they see information from interesting people and they decide to follow them on Twitter. 

Because people use the service, they invest further in the service since they began to follow additional Tweeps. In this Investment stage of the Hook Model, users store value into the service what helps them get through the 4-staged Hook cycle faster and faster. Eventually, they will open Twitter based on internal Triggers because their brain knows that when they’re bored, Twitter will scratch that itch for them and ta-da a habit is formed. 🎉

Skipping Their Beat

Spotify’s new focus on pushing non-user created content is completely neglecting the Investment part of the Hook Model. Where it used to be their core growth driver: connecting people with each other through music and in that way letting them invest and store value into the service, now its their broken stage in the Hook Model. Their broken stage in making and keeping Spotify an uninterchangeable part of people's life. A habit.

So this tendency is not only my personal belief and experience, it can be explained by a model which is highly acclaimed and used by thousands and thousands product developers, founders and marketeers.

And while the lion’s share of users of streaming services are utilising Spotify, especially in Europe. What if somebody wakes up angry at Apple or Youtube and says: let’s spend billions in order to take the whole music streaming market and offer the same data generated kind of playlists with just as good marketing, for $1,- less a month than Spotify does? Nothing makes someone stick to Spotify since the stored value in the service is single-handedly destroyed by the company itself.

Wrapping it up

And although this is merely an opinion of one person, me. It’s the opinion of an early-adopter who’ve seen the service grow and develop, and history has proven that whenever early-adopters are shifting their advocacy or even leaves a product or service, that’s the first tear at the seam of an organisation’s growth.

So hey, Daniel. Start living by your own quote again, and you might just survive the cash and the angry morning ideas of Apple’s and Youtube’s board. And if you don’t take my word for it, try The Economist’s.

See it differently, something to add or is your name Daniel Ek? Hit like and comment below! And stay on the look-out for another Spotify-centric blogpost.

Need help with your company’s growth?

We help startups enhance their product, story and growth with our digital growth agency WE ARE OFF THE RECORD. You can email me directly at 👉 dusty@weareofftherecord.com!