Customer Data Case Study – Spotify
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Background
Spotify launched in a handful of European countries on October 7, 2008 and has grown its active user base to become the leading music streaming platform, with over 354 million Monthly Active Users and 155 million Premium Subscribers by the fourth quarter of 2020.
Strategy
Spotify’s focus on providing users with a continuously-evolving, personalized listening experience has made it the platform of choice for listeners. Its use of artificial intelligence and data analytics goes beyond simple search to learn the listening preferences of users, suggest new music and podcasts, build customized music playlists, in turn supporting a satisfying, novel and compelling user experience.
According to a 2020 blog post by Nicole Burrow, Senior Design Director at Spotify, the focus as the XD team has doubled over a two-year period has been building an internal design culture that includes growth paths for XD professionals, empathetic management and a robust hiring of skilled professionals and collaborative processes. Cliona O’Sullivan, Head of Design Ops at describes the integration of Design into leadership and business strategy, a hallmark of mature XD practices:
“Design leadership shapes and drives product design at Spotify, enabling our missions to create engaging, usable, and innovative products while maintaining joy throughout our process and output. Each member of the design leadership team sets the expectations of design within both their respective mission and collectively across the company.”
User research is also critical to Spotify’s XD program, with quantitative and qualitative data collection to understand the impact of new features on user experience.
Results
Spotify’s success with listeners has resulted from a relentless focus on creating value for listeners: using technology as a mechanism to personalize and evolve their experience, thereby creating customer loyalty that results in MAU growth and retention. More recently, Spotify has also begun to use data analytics and visualization to support artist understanding of their own listener engagement and expand their creativity. This marks an expansion to a secondary user population, although the strategy of using its technology to heighten awareness, create satisfaction and motivate retention is similar to the approach that has been successful with listeners.
Key lessons
Spotify provides a view of a mature XD organization: its focus on Experience Design, measurable user outcomes and development of a culture that embraces a diverse, multidisciplinary team of XD professionals. As a result, Spotify has become a pace-setter for its industry in innovation, market leadership and product differentiation, all in a few short years.
