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Survey: Spotify Satisfies Advertisers

Published on March 28, 2012

A strong nod for streaming music provider Spotify, and from across the pond. Spotify has taken the lead in the latest Institute of Practitioners in Advertising’s (IPA) Online Media Owner Survey, with 83.5% of 259 UK-based respondents agreeing/agreeing strongly that "My overall experience of dealing with this supplier is a good one." This is the first time in more than three years that a new leader has emerged as Specific Media has been top since autumn 2008. This is also the first time a new entrant to the survey has leapt straight to the top of the IPA Survey.

As Robert Andrews of paidContent describes it, “Spotify employs an army of ad sales staff at its London business headquarters, selling ads that can be targeted to geographic, demographic and other identifiers.” The company made almost a third of its revenue in 2010 from advertising, the remaining two-thirds through subscriberships. Last year Spotify hired a chief advertising officer, in the form of former AOL exec Jeff Levick. He described the Spotify value proposition to Adweek: “We believe we have a superior product [and] you can do more of with Spotify. We have the largest library of music available in the cloud with 15 million tracks, and it continues to grow,” versus an estimated 800,000 tracks at the time for rival Pandora (which after a decade still struggles with profitability).

In the API survey, Specific Media slipped to fourth place as overall service levels improve and become more competitive, with seven media owners achieving scores in excess of 70% for this category, compared to five in the autumn 2011 survey. In second place is California-based Tribal Fusion, followed by AOL, Specific, Adjug, Glam Media and the Telegraph. Adjug and Glam Media also being new entrants to the survey.
Other key findings:

  • Tribal Fusion is the overall winner among ad networks, exchanges and sales houses, Spotify leads the online pure play sector with AOL in second place, and have taken over leadership from IPC in the cross-over media sector
  • Sky Digital Media is the most improved media owner since the autumn survey (+10.6 percentage points), and a further five media owners have improved their score in the best overall category by 5 percentage points or more.
  • At the other extreme IPC Media have seen their score decline by 11.2 percentage points since the autumn survey.
  • Year-on-year Microsoft is the most improved, up 20.7 percentage points from their low point of 36% in the spring 2011 survey. Tribal Fusion has improved by 17.9 percentage points and AOL by 15.9.
  • In addition to leading the overall survey attribute, Spotify leads in three other areas (quality of response to brief, understanding of own products, and delivery of innovative creative solutions).
  • AOL leads in four areas (dispute resolution, ease of contact, client/media agency partnership and mid campaign support). Tribal Fusion leads in two areas (understanding of client objectives and post campaign support). Glam Media leads in one (communication of contact with client), as do Facebook (proactivity) and Specific Media (regular contact).