Spotify's New Approach: My Thoughts
I’ve been diving into the Spotify for Creators of it all, and I wanted to share some thoughts, especially around what stuck out about their strategy.
Where did I get this insight?
This video podcast interview with Daniel Ek and their Q3 2024 earnings call. Here is the deck.
One of the key components they’re focusing on is something they call Algotorial. "Algorithm and editorial together." That's a term that I hadn't heard before, but now I have!
That’s how they’re running the platform, they combine algorithm-based discovery with human curation.
What really stood out to me was how the Spotify CEO emphasizes two main things: dependability and discoverability.
Dependability is about the consistency of the user experience, as in every time someone opens Spotify, it feels reliable and familiar.
The discoverability is about serving content in context, tailored to the user’s habits and needs.
For example, Spotify knows when you’re going for a run and serves you just the right playlist. They learn your behavior and provide recommendations that feel almost magical.
The key, is that you use it, consistently.
Their whole mission is to make Spotify a platform that is magical to use.
This isn’t just about video or creators; it’s about their entire ecosystem.
They’re leaning into platform usability, which they have done from the get-go as most OG Spotify users can confirm, a contextual UI that allows people to discover content visually.
Imagine opening the app and immediately getting a sense of what you want to consume, even without listening. It’s more Netflix than YouTube.
And here’s a critical difference, as I understand it from listening and watching: Spotify is all about consistency in delivering a dependable experience for its audience.
The platform values creators who show up regularly and reliably, ensuring their content is always there when listeners expect it.
This felt like it was a pretty meaningful mission for them.
YouTube, on the other hand, is less about strict publishing schedules or regularity and more about mastering algorithmic best practices.
From my very limited experience, success on YouTube depends on things like click-through rate (CTR), eye-catching thumbnails, engaging titles, and polished visual editing and all those fancy best practices that we hear all over the place.
Spotify’s focus is less on gaming the algorithm and more on maintaining a consistent presence that fosters trust and discoverability, within their platform.
Spotify’s Revenue Model
This all makes sense when you consider that 84% of their revenue comes from subscribers, and only 11% is ad-supported.
They’re laser-focused on growing their subscriber base and keeping people on the platform. I mean wouldn't YOU? Lawd.
It’s a completely different approach compared to platforms like YouTube, which heavily rely on ad revenue.
For Spotify, the goal isn’t just to host creators; it’s to build an experience that keeps people using Spotify daily. Whether it’s music, podcasts, or audiobooks, they’re all about retention.
And that’s why they emphasize long-form, conversational podcasts over highly produced videos that go SOOOOO fast and you have to slow down because you can barely understand what they are saying! Ok, that might just be me 😅
Creators as Entrepreneurs
Another fascinating thing is their perspective on creators. They see creators as entrepreneurs, and they want to be “the R&D department for the creator-entrepreneur of tomorrow.” NOW, that is a statement!
Listen, I know that seeing creators as entrepreneurs is by no means new, but they have built it in their strategy as a key persona they are heavily going after.
Not all creators are entrepreneurs, but the ones that are will have the skills to get people on the platform. They are banking on having the highly skilled folks that have been around the block a few times use their skills to get people to pay for Spotify!!!!
Also, they’re not trying to monopolize content; instead, they encourage creators to “multi-home” aka to distribute content across multiple platforms because...
Spotify isn’t focused solely on podcasters. They’re taking a more holistic approach to creators and their influence.
This isn’t just about one medium, it’s about the broader ecosystem.
They want to support creators in ways that drive audiences to sign up for Spotify.
Imagine that...
I think there's a theme there.
They’re even branching out into new areas. For example, Spotify is publishing books, developing a music marketplace, and testing educational courses in the UK.
I'm very curious about all those things. Don't know too much about them.
Their vision is to create a hub for multi-modal digital experiences, and they’re thinking way ahead, like, 10, 20 years into the future.
Listen, I'm going off of a vibe here.🧐
A Curious Challenge
This is why I think it’s worth experimenting with Spotify. I’m even considering making it my sole podcast app for the first quarter of 2025 to see how it learns me, what it serves up, and how the consumption experience feels!
I know, blasphemy for my OG podcast listener self.
That said, there’s still a lot they don’t know. They’re innovating as they go, and even Spotify admits they’re figuring out how to make this a win-win for creators and the company.
It’s early days, but it’s something worth watching.
Implications for Podcasters
For podcasters, there are some clear takeaways:
- Consistency is Key: Spotify values consistent publishing over one-off viral hits.
- Visual Presentation Matters: Think Netflix-style visuals—thumbnails, subtitles, and quick visual cues. Maybe? IDK...
- Experimentation is Encouraged: This is my personal suggestion. Use Spotify’s tools to see how they enhance your audience’s experience.
Workflow-wise for audio first (only) podcasters that are adding video? Not sure.
There is some murkiness in there for best practices.
Don't know enough to comment.
Spotify is also leaning heavily into subscription models, and it’s unclear how ads will factor into their approach.
If you’re working in podcast advertising, this is definitely something to keep an eye on.
I'm not a paying Spotify person. I'm an Apple Music person. I'm not sure what I'm missing!