Spotify strengthens Asia presence

More than a year after it first entered Singapore, Spotify has officially opened its Asia hub.

First opened in Singapore for the markets of Hong Kong and Malaysia in April 2013, the music-streaming company has since grown to 20 employees, with most of them based in Singapore as the regional hub.

It is now present in five markets across Asia and a further expansion to several other markets is on the cards. While declining to reveal growth figures, the managing director of Asia, Sunita Kaur, told Marketing all markets in Asia were in sight for the company’s expansion.

It currently has more than 20 million songs on its database, and 40 million users, of which 10 million are paid subscribers.

Kaur said a mobile-first strategy had been key in growing the user base substantially in Singapore, Malaysia and Hong Kong. Initially, users could access Spotify from their desktops for free, but had to pay to access it on their mobile devices.

However, since it changed that to allow users free mobile access, the uptake has been quick.

“Singapore users top Malaysia, Hong Kong and Taiwan in terms of daily mobile music streaming, and music streaming growth has tripled since Spotify entered the market,” Kaur said.

For Asia, the approach has been to go local, with the music-streaming service actively reaching out to local artists/labels in each market, which has helped the company push its user uptake extensively. This is particularly so for markets such as the Philippines, Hong Kong and Taiwan.

While in the US, there have been issues with artists taking up Spotify, (for example, Pink Floyd and Metallica were previously absent, but have now come on board) Kaur said there were no such issues so far with artists in Asia.

As an advertising platform, Spotify has been working with brands to help them create what it calls “interactive” audio ads. It has been holding workshops for creative agencies and helping them to create these audio ads.

Brands that have already signed on with Spotify include the likes of Nike and adidas, among many others.

Does this mean a serious threat to radio? Kaur denies it, saying the ad formats the company encourages are much different than how radio ads are built.

However, that reality seems more likely as Spotify quickly grows its repertoire of music and enhances its platform as a discovery vehicle for artists.

Marketing plans for Spotify

Spotify largely markets through word-of-mouth, said Kaur. “Our users are our marketers.”

Other than that, it has been partnering telcos across the region. For example, it has inked deals with Globe in the Philippines and Maxis in Malaysia, as well as hardware partnerships with the likes of sound equipment brands Bose, Samsung and others. It has also been sponsoring events as a partner, such as the recently concluded Music Run in Malaysia.

More marketing plans are in the pipeline, Kaur said without revealing further details.

While events sponsorship will continue to be a major part of its marketing strategy, it is also looking to work closely with media and creative agencies to market its own brand. It is, for example, planning to run a creative hackathon to come up with the best audio spots for Spotify in the region.