This article was adapted with permission from Customer Strategist Journal
Uncovering actionable insights in marketing is often an elusive goal. Marketers have a plethora of data but few companies have figured out how to effectively leverage that data to deliver individualized, targeted content at scale. Data-driven insights offer a key to effectively engaging consumers. But how does one collect and analyze enough data to engage individuals in a scalable approach?
Streaming data may be the answer.
Streaming refers to transmitting or receiving data over a computer network. And subscription streaming is becoming a "key driver" of the nearly $15-billion music industry, according to the International Federation of the Phonographic Industry (IFPI), a music lobby group, which recently released itsannual Digital Music Report.
As more consumers turn to music streaming services, companies like Spotify and Pandora are mining those streams for user insights. Spotify, for instance, knows a lot about its users. The company-which expects to have 100 million users by the end of this year-knows how and when people listen to music. Spotify knows if you are listening toLady Gaga while joggingor Frank Sinatra in the shower. The company knows this by not only tracking the songs people are streaming, but through users who label their activities, says Spotify Chief Revenue Officer Jeff Levick.
"People are soundtracking their lives and creating playlists with names like 'shower,'" Levick said during a presentation at the IAB's Mixx conference. "We have over 39,000 shower playlists on Spotify." By analyzing patterns related to shower playlists, Spotify uncovered numerous insights about its users.
For instance, the company learned that most (44 percent) of the users who create shower playlists are between ages 18 and 24, followed by 23 percent of users who are ages 25 to 34. Additionally, 68 percent of the shower playlists are created by men, compared to 32 percent of women. Information like this can help brands tailor ads for more specific audiences.
Music streaming services can also help artists find their fans. For instance, when country music singer Hunter Hayes released a new single, 21, earlier this year, he used data from Spotify to plot his 21 tour stops. Hayes released 21 on streaming platforms before physical retail or digital stores. Based on data from those streams, Spotify identified cities with the highest volume of users listening to the 24-year-old singer's songs compared to other locations. Based on this information, Hayes performed in places like Western Carolina University, Kent State University, West Point Eisenhower Hall Theater, and University of Oklahoma.
"That data-along with country radio airplay and single sales - is invaluable to identify where you have an active, passionate audience currently excited about an artist's music," Warner Music Nashville's Jeremy Holley toldMashable.
Spotify's competitor, Pandora, offers artists a similar feature through tools for monitoring and analyzing fan engagement on its music streaming service. With Artist Marketing Platform (AMP), Pandora lets artists know which songs are performing well based on factors like the number of people listening to the song, the number of likes the song garners, as well as the general location of their fans.
Real-time data from streamed music can also allow brands to target listeners beyond basic demographic information. Indeed, what matters more is what people are doing versus what marketers think consumers are doing, Levick said. Besides targeting listeners based on age or gender, for example, brands "can look at the days of the week and organize around what it is people are doing when they're doing it and create some interesting inferences and target smarter," Levick said.
Nike, for example, created a series of playlists with songs for Spotify users to listen to while running. Even though Nike might not deliver an ad every time someone listens to its playlists, it creates a brand experience that helps the retailer extend the customer relationship.
Spotify also gave users a new way to listen to music while jogging. In May, the company introduced Spotify Running, an opt-in feature that matches music beats to the user's running tempo. It uses a smartphone's sensors to detect your steps per minute and finds tracks with a similar beat.
Other brands are also experimenting with new data-driven ways to enhance the customer experience. Soon after Spotify Running was released, Nike updated its Nike+ Running app with the new features through a partnership with Spotify. The app update introduces Pace Stations, which invite users to enter their pace goal and musical preference. This data informs a target BPM (beats per minute), which in turn creates a personalized100-song playlist designed to encourage runners to step in-beat to the prescribed song and meet their pace goal.