Spotify tests adding ‘sponsored songs’ to playlists
June 20, 20171.2K views0 comments
Spotify has confirmed it is experimenting with allowing music labels to promote songs by adding them to users’ playlists as sponsored content.
The Swedish-based music platform said subscription payers were not included in the small trial.
Those whose accounts are affected are able to opt out via the settings.
Spotify has more than 140 million active users but continues to operate at a loss.
It recently revealed that while it had revenues of more than 2.9bn euros (£2.6bn) in 2016, it reported a net loss of 539.2m euros (£471.6m).
“This is not the silver bullet but instead part of what will be a multi-faceted answer to Spotify’s margin woes,” said Mark Mulligan, managing director of Midia research.
“In a broader context, this may presage a wider strategy similar to that of Facebook’s, whereby it effectively starts charging artists and labels for access to fans.”
Spotify is considering becoming a public company and listing on the stock market.
It says it has more than 50 million subscribers, who can access its library of 30 million tracks without advertising.
The monthly subscription is currently £9.99 in the UK, $9.99 in the US and 9.99 euros in France. The company operates in 60 countries.
“We are always testing new promotional tools that deliver the highest relevancy to our users,” Spotify said in a statement.