Oh, Spotify, much is to learn about your users.

Anyone else use Spotify's free version? Anyone else annoyed by the ads? That's what I thought. ((Note: before someone spouts off that I should spring for a premium account or switch music streaming service if I don't like the ads, read this post through first.))

What is it about those ads that we find annoying? Their frequency? Their duration? While those are annoying, they are part and parcel with a free service. So, no that's not my problem. What is of concern to me is that Spotify doesn't know its customers. Oh sure, they have demographic information, but they don't "get" me. So, you're asking, what does that mean?

Screen capture from Spotify desktop app showing ad playing.

The ads that are run by Spotify are largely meaningless to me and, I suspect, to many of its users. Clearly these are paid spots (I'm unaware of how Spotify monetizes its ads), but their relevance to me is low and therefore I am unlikely to click through. The screen capture above shows what I mean: an ad for Bruno Mars' new album and a sampling of the music in my playlist - the ad is for a pop artist, my music selection is largely hard rock (e.g., Soundgarden), metal (e.g., Metallica), electronic (e.g., Skrillex, Chemical Brothers) and some rap (e.g., Beastie Boys). Pop music really doesn't figure in my rotation.

A better ad would be the banner below. I am male, in my 40's, two kids, and am conscious about my expenses and safety net I provide for my family. (While the content leaves a lot to be desired, insurance is surely on my mind.) Unfortunately, this appears to be on a random banner rotation since the two banners before were for hip-hop artists.

Screen capture from Spotify desktop app showing banner ad.

My playlist is hosted by Spotify which means they have access to my selections and all the meta data that is attached to each selection; genre, artist, album, etc. Based on this meta data, Spotify could understand my preferences and musical tastes and therefore present me with relevant ads that would interest me enough to click through and learn more.

While Spotify is struggling financially, it is looking to score more advertisers to increase its ad-based revenue stream. ("Spotify’s ad sales revenue has doubled year-over-year for the past two years. But the plan is to dial things up and start exploring larger deals with major ad holding companies...") However, advertisers will be looking to measure their ROI for the ads placed with Spotify. If Spotify continues to place ads more or less randomly, that ROI will be lower than it could be. However, if Spotify were to "get" its customers better, those ads could be targeted to the correct segments rather than use a shotgun approach and hope that some users click through.


This all amounts to providing additional value to Spotify's users and to Spotify's advertising customers. Knowing its user segmentation and preferences will allow Spotify to:

• Target ads better, and
• Offer advertisers/marketers more insight into their customers.

Then, maybe Spotify can improve its ad-based revenue stream by charging premium placement for targeted ads in front of relevant customers who have a high click-through history.

Know thy user.