Analysis

CMO Seth Farbman on Spotify: ‘It’s maybe more like a republic than a democracy’


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Spotify is a republic rather than a democracy. Music hardware that doesn’t support Spotify is “poor”. Playlists like RapCaviar are Spotify’s equivalent of Netflix’s Stranger Things or Orange Is The New Black. And Spotify is interested in the potential that the ‘tips’ culture in Asian social apps has for fan-artist relations in the west.

These were all things we learned from a fireside chat with Spotify’s chief marketing officer Seth Farbman at Music Biz and Music Ally’s NY:LON Connect conference in New York this morning. He was interviewed on-stage by Music Ally’s Wesley T. A’Harrah.

“When I arrived roughly three years ago, job one was really to explain to everyone what streaming was and why streaming?” he said. Farbman joined Spotify from clothing retailer The Gap, where he was also CMO.

“There needed to be just a level of education on the core value proposition. As a marketer I think in terms of we want from ‘a thousand songs in your pocket’ which we remember was one of the most brilliant ideas that came from Apple, to ‘all the world’s music anywhere’. This sense of access and portability was a very valuable thing. But that’s at the beginning.”

A running theme of the session was Farbman’s desire – without mentioning Apple Music by name – to outline why he thinks Spotify is building something genuinely different to its major rivals.

“At the core, if I had to get it, it is this notion of discovery. And what I think we do exceptionally well is provide a kind of discovery that is not reductive. It’s expansive. If you think about the world right now: there’s a lot of conversations about bubbles,” he said.

“This sense that people have gotten into their own world, and that their recommendations and their progress of bringing in new ideas and more information is getting more narrow, was front and centre… But what we’ve been able to do is to allow people to discover not just music they’d have discovered on their own, or artists they’d have discovered on their own.”

Farbman elaborated on Spotify’s decision to make playlists one of its key features, while also exploring original video content, and other formats like podcasts.

“We know that all the platforms, if they’re really delivering a decent service, have a wide variety of music that’s really similar. So we started with playlists. Test and learn,” said Farbman. “Given unlimited options, you make none. You have to provide some reference point. It’s not just personalisation. We want curation, we want insight, we want help. And that’s really the playlist… the core product that Spotify became known for.”

Farbman also suggested that Spotify’s expansion into other content types has been led by the potential for artists. “We call them creators or artists, we don’t call them singers or musicians… the artist has a point of view and an inherent desire to share that. Music is [just] one of the artforms,” he said.

“We see getting into video providing a greater set of content types for artists, and to then make the experience hopefully more enriching and engaging. But we haven’t been sure from the beginning exactly how to get there.”

That’s true. Spotify’s first video strategy was to license in content from multi-channel networks and other digital producers. It was later replaced by a strategy of commissioning shortform, music-themed shows.

Neither of those options seemed to catch fire, so the strategy now is more about creating video to be embedded within playlists, as well as exploring the potential to blend audio, video, images and text in the recently-unveiled Spotlight format for news, podcasts and audiobooks.

A’Harrah asked Farbman about Spotify’s decision to take a stand on political issues, such as its I’m With The Banned initiative in protest at US president Donald Trump’s attempts to introduce an immigration ban for a number of largely-Muslim countries.

“If you go back to very early in the current administration you’ll recall that there was the travel ban that caused a ton of chaos. This idea, I’m With The Band, really came from our employees. They came in from a really unsettling weekend and said there’s really some basic kind of human dignity that needs to be addressed here,” said Farbman.

“Spotify is a platform here: it’s democratic, it’s a meritocracy. It’s meant to bring music to everyone in the world without limitations in that sense. It’s very inclusive, so we believe in that [principle]. We could have done an ad like somebody else. I try not to do too many ads. I try just to really use the platform and then other media to tell the story of the power of music and the relationship with fans.”

He continued: “Fundamentally I believe that the role of artists, all artists, is to give voice to those who don’t have it. So that society, culture, the world gets better when we take care of people who don’t have voices. That was the initial thought. And music has obviously always been the way we bring ourselves back together,” continued Farbman.

“I’m With The Banned simply became our way of reminding the world, at a time when I felt strongly it needed reminding, that we’ve been through these things before… and that when you’re inclusive as a society – when you invite people in who are different to you – we always have prospered and we always will.”

Farbman fielded a question about why a growing number of Spotify’s new features and content seem to debut exclusively in the US, arguing that the size of the market is one reason.

“This is such an important and large media market, and it’s such a large cultural driver, so we can learn much quicker at greater scale in the US. And what we’ve done subsequently with video, with our social impacts, with artist marketing etc, we’ve recognised that we really need to drill down on local much more,” he said.

A’Harrah asked about the world of smart speakers – Amazon’s Echo, Google Home, Apple’s HomePod and more – and what it means for Spotify. Farbman talked about Christmas Day 2017 as “the dawn of a new age” – based on stellar sales for these devices in the holiday season – and backed the technology to continue growing.

“Clearly, voice is for real, and it’s a thing, and it’s going to be adopted probably at a more rapid rate than other technologies,” he said. That brings challenges for Spotify though: the two main smart speaker brands in the west (and soon the third once HomePod goes on sale) belong to big-tech companies that run – and may thus prioritise – their own music-streaming services.

How is Spotify approaching this world? “Step one is to make Spotify available on every platform that has a voice option, and we fundamentally believe in not choosing a single partner and going down that road. It’s a more egalitarian view,” said Farbman, citing Spotify’s partnership with Google as particularly fruitful in recent months.

“Home had a wonderful, wonderful fourth quarter, from what I’m understanding and data I’m seeing,” said Farbman, before delivering a barely-veiled criticism of Apple without mentioning the company by name. “It’s a poor product if you launch a piece of hardware that does not deliver against the intent that people want. And the intent is people want their Spotify.”

Farbman was positive about the wider theme of competition for Spotify in the music-streaming space from the likes of Apple, citing that Apple Music’s launch in 2015 “helped solidify, normalise streaming as a choice” for people who hadn’t yet tried a service.

“When you have such massive brands essentially driving both their own customers and prospects in the direction we want to go, it actually helps us. I’m hopeful that’s what happens: we see greater adoption at a greater pace, and then the competition is the right one: what kind of content are you giving people, how easy are you making it for them to get to your content, and what is differentiated?” he said.

Spotify has been focusing on building out playlist brands like RapCaviar on the latter front, for example with live concerts. Farbman said Spotify sees these playlists as “sub-brands” comparable to a product for a consumer electronics company, or a show for a broadcaster or digital-video service.

“It’s really like a product brand or a show brand. If you think about a similar industry, a similar strategy: Netflix obviously started at ‘we have stuff you can watch on demand’… and then they recognised at one point that rather than market the distribution and the value of the technology, they needed to create differentiated product… And now they’ve got into creating their own material quite effectively, as you know. And that’s what they market,” he said.

The concerts are a key part of this too. “In a highly digital world you must recognise the value of human beings together,” said Farbman. “If you want to be a fully-formed brand you have to look at a person’s entire life, how they connect with each other, in order to solidify that kind of feeling.”

Spotify is still facing regular controversies around questions of creator remuneration from streaming, albeit seemingly focused more on songwriters and publishing licensing now than the [recording] artist-led criticism of past years. Farbman maintained that Spotify is operating with the right values for its creative community.

“I believe we have the opportunity to drive a better opportunity for art to grow, and thrive, and to reach more people,” he said. “These things take time, but we’re in the second inning of this. And that’s maybe being generous.”

The session finished with a couple of questions from the audience. One questioned Farbman’s claims that Spotify is a democratic platform in terms of music discovery, when the service exerts a lot of control (through its playlists) over what songs and artists are put in front of listeners.

“You’re right that it’s maybe more like a republic than a democracy… Our intentions are always democratic and absolutely inclusive, but you have to have somebody running the show every now and again. And that’s how I see a playlist is intended: it is intended to provide a clear point of view. Simplicity and clarity and direction that 90% of bands really appreciate. I don’t believe that discovery ought to be left to chance, and accidental,” he said.

“We try to provide a little bit of guidance. It is a balance between open access that is truly democratic, and then a guiding hand which makes it a bit more useful.”

The final question concerned Spotify’s recent partnership with Chinese tech firm Tencent’s music division, which so far has focused on the investment level – a stock-swap, essentially – rather than collaboration between Spotify and Tencent’s streaming services. What could come of this deal though?

Farbman parried at first. “It remains to be seen. They’re certainly a fantastic partner for us to have in an area of the world that we’re still learning about. So it made a lot of sense for us, but how that plays out, we’re still working on,” he said.

However, A’Harrah followed up, and elicited a much more interesting nugget. Spotify is looking closely at the social apps ecosystem in Asia, and particularly the way fans can ‘tip’ creators with money through their favourite apps.

“I love the concept in Asia and China in particular where it’s micro-payments, where you like something… this sense that when you receive something of value, you can immediately recognise the value of that content or artist by giving them a little tip or something,” said Farbman.

“One thing that does is it starts to create a bond. So how do we connect artists and fans in ways that they’re more aware of one another, where you can feel the impact of fandom if you’re an artist, and get that satisfaction back if you’re a fan? I think that’s done in Asia much better than it is in the rest of the world, so that’s something we’re watching carefully.”

Stuart Dredge

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