Spotify to Launch Two New Ad Offerings

Music streaming service Spotify is launching two new offerings for advertisers.

Spotify for Brands – Spotify’s marketing platform that connects uses of the music streaming service with brands – has unveiled ‘video takeover’ on desktop and ‘sponsored sessions’ on mobile.

The two new products launch worldwide to Spotify’s 30 million plus free user base from early 2015. Global launch partners include Coca-Cola, Ford, McDonald’s and NBC Universal. Pictures.

Jeff Levick, Spotify’s chief business officer, told B&T: “It’s the largest new ad related launch since Spotify was founded more than seven years ago.”

Levick says there has been interest from local advertisers in the offerings but at this stage, only the launch partners can be revealed.

He said: “Because we’re not making this 100% live until Q1, the only thing we’re able to announce is the brands that are part of the test group. One of the reasons we’re excited to get this live in market is that other brands will be able to engage with the experience and also it will give us a chance to get better data at scale that will help us continue to refine and enhance the products.”

The details of the two new opportunities for advertisers are as follows:

Video takeover

Video takeover works for users engaging with Spotify on their desktop computers. Effectively, it is a 15 or 30 second ad break which is served only if client is in view giving the advertiser what Spotify calls “100% share of voice” which is a jargony way of saying it’s the only ad the user can see.

VideoTakeover

Sponsored sessions

Sponsored sessions involve exclusive sponsorship of 30-minute ad-free sessions for non-paying Spotify users on their mobile devices. Listeners must watch a full 15 or 30 second ad to receive 30 minutes of ad-free listening.

SponsoredSession

Levick says the two offerings are highly targeted, based around what the streaming service calls “moments”. He says: “Moments are activities, based on our data, we believe the consumer is engaging in in real time. An example a moment would be waking up. Commuting would be a moment. Working out would be a moment. This is the next level of targeting we’re looking into and brands would be excited because it’s giving them the chance to bring much more relevant content to an activity that consumers are already engaging in.”

Spotify offers an ad funded free service as well as a paid subscription model. When asked whether he prefers paying subscribers or users who see ads, Levick said: “We’re happy if people come and engage on the free platform, we’re happy if people come and become premium subscribers. Our goal, ultimately, is to get as many people on the platform as possible and then let them choose which way they want to engage with Spotify.”

Levick, who is based in New York, noted the success of the platform locally. He said: “Spotify is going incredibly well in Australia. It’s been one of our most successful launches in the last two or three years. We’re very happy with the share of audience we have. We’re very happy with the growth rate. We’re very happy with the partnerships in the region.”

According to Nielsen, Spotify owns 70% of the music streaming market in Australia.

Levick also believes the uptake Down Under has had a roll on effect to other countries. “We think that it has even had a lot to do with our success in New Zealand,” he said.

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