TLDR: Spotify uses your data to make a personalized experience just for you. This keeps customers engaged and subscribed.
So what?: Personalization is key. Any business that masters the data it collects can use it to leverage customer engagement.
More than 80% of US adults say data privacy is a growing concern for them. A full 30% aren’t willing to share their data for any reason. But suppose you could build a business that constantly collects users’ data while showing them again and again that you do so?
Spotify does precisely this. The world’s most popular music streaming app collects data on each user’s listening habits. They then use that data to create personalized playlists and song recommendations.
Instead of being creepy, it’s fun. People enjoy Spotify’s data-driven suggestions and don’t view it as corporate overreach. Spotify’s data harvesting is part of the service, not the cost of using it.
Personalization is key to Spotify’s customer engagement efforts. Their machine-learning algorithms make every user’s experience unique.
To follow Spotify’s customer engagement strategy, consider doing the following:
- Deliver free, personalized products.
- Use your product in fun ways on social media.
- Care for your customers.
- Be relentlessly relevant
Spotify’s strategy works. In 2020, the company earned over $10 billion in revenue.
Deliver free, personalized products
In early December each year, Spotify subscribers receive their “Wrapped” playlist, also known as the “Year in Review.” This playlist contains all the tracks that the user played frequently, starting with their number one most played song.
Long-time Spotify users look forward to this moment all year long. It is kind of like an early Christmas present. It provides a fun way to look back on the year and remember everything that happened.
Free, personalized products like this help to engage customers in several ways:
- It signals that the brand cares about its customers.
- It adds a little novelty to the customer experience.
- It provides a mirror for customers to see themselves in.
- It encourages users to share their personalized items on social media.
No doubt the annual Wrapped playlist makes customers feel like Spotify really knows them. It can take a slight edge off the otherwise unnerving fact that corporations are harvesting your data. At least the data is being put to good use!
People love taking personality quizzes, because it shows them something about themselves. That’s why they take Buzzfeed’s Disney Princess quiz, knowing full well it represents no scientific finding whatsoever. Spotify’s Wrapped playlist serves the same function, but by collecting data over a long period, it is arguably more informative.
Sharing is a key element of the Spotify experience. People like sharing their playlists because it shows something about themselves. What better playlist to share than their annual, personalized Wrapped playlist?
Showcase your product in fun ways on social media
Because Spotify sells a digital product, it can easily showcase its possibilities on the internet. One playful way they do this is by posting playlists that spell out whole sentences.
Here, Spotify uses its Twitter account to post a clever response to a confused customer. The company created an actual playlist that spelled out the statement “Mr. Scott, Welcome to the party. We’re here for a good time, so don’t worry about a thing. We’ll be here when you need us. Just shout and we will come running!”
While other brands may post images, video, or other content on their social media, Spotify can go ahead and link to its actual product. This helps in several ways:
- It showcases the possibilities of their platform.
- It demonstrates Spotify’s intelligence and humor.
- It helps customers feel heard.
Some users may see this playlist and actually find music that they like. It could help introduce them to Spotify.
Spotify even does a similar trick when you cancel your subscription, enticing users back in:
Care for your customers
The above exchange took place on Spotify’s @spotifycares account. With a name like Spotify Cares, you immediately signal that you care about your customers. This Twitter account works as information, social media promotion, and customer service.
Spotify also operates its Random Acts of Kindness (RAKs) program. This program randomly surprises customers with a curated song or playlist. From these customers, they pick out monthly winners who get free dinner vouchers. These winners are then put into a yearly raffle for tickets to the South by Southwest music festival.
Be relentlessly relevant
Modern brands need to be relentlessly relevant to keep up in today’s information-saturated world. Prophet, a market consultancy firm, puts out an annual index of Brand Relevance. Spotify has frequently made the top 10, placing at #2 in 2019 and #9 in 2018.
Staying relevant helps keep your brand on your customers’ minds. Spotify has strong competitors, like Apple Music, which connects to the entire Apple ecosystem. Yet Spotify has 400 million users, more than six times as many as Apple Music’s 60 million.
Spotify holds on to the top spot by being what people think about when they think “music.” Their streaming service is almost synonymous with music listening for millions of people. This is what it means to be relentlessly relevant.
How to Follow Spotify’s Winning Formula for Customer Engagement
Personalization, care, and relevance are the key. You want to use customer data to personalize their experience without being creepy or abusive.
This means that you are going to have to collect a lot of data. Not all industries are suitable for this. But if your business already collects tons of data, start looking for good ways to use it.
Consider doing something like Spotify’s annual Wrapped playlist. Collect statistics on each user’s annual usage, and deliver them in a fun way. A video streaming platform could do almost the exact same thing, by sharing each user’s top 10 most-watched videos in a year.
Use your data to help users find more of what they want. Help them out if they get lost. And be relentlessly relevant.
Media Shower helps brands build customer engagement strategies to fit their needs. We understand the ins and outs of the strategies employed by companies as diverse as Red Bull, Starbucks, and Alibaba. This helps us to craft a unique plan for you. Click here to try Media Shower for free.