The number of Spotify Premium users is growing in every country, demonstrating consumers’ willingness to pay for control and ad-free services
The music streaming industry continues to rise in the US, UK and Nordic countries, where around half of the online population is now streaming or downloading music on a weekly basis.
While Spotify dominates the market in the UK and Nordics, the scenario is quite different in the US; there, music streaming is dominated by YouTube, while Spotify and Pandora Music are neck and neck for the number 2 chart position.
Compared to our study from 2017, Spotify has seen steady growth in premium subscriptions at the expense of their free version which instead has decreased, suggesting that consumers are definitely seeking to pay for control and ad-free services. This solid business model for streaming companies is somewhat reinforced, also by the relatively high numbers of consumers who claim to only listen to non-commercial radio.
We also saw this trend in our latest study about TV, online video and streaming habits. One surprising outcome was that up to two-thirds of the Netflix users claimed that they would cancel their Netflix subscription if it began running ads!
A quarter of the online population listens to podcasts every week
In the last couple of years, the number of people listening to podcasts has seen a sharp increase.
Podcasts are not for early adopters anymore, rather, are firmly switching into the mainstream. In particular, the younger generations have embraced the podcast format, which seems to fit perfectly into their daily lives, and supports the theory (as seen in our streaming services data), that they also seek control of their media schedule.
For advertisers, this is, of course, interesting as it opens up new advertising opportunities – and potentially very important given some audiences’ propensity for ad-free choices. This is even better news for brands when considering that podcast advertisements are proven to generate better brand recall and higher purchase intent than other digital media.
Radio is still popular – especially among the older generations
Three-quarters of the online population listens to radio. However, corresponding with the trends for ‘traditional’ TV usage in our latest study, ‘traditional’ radio is most popular amongst older generations.
It is also noteworthy that amongst the online population, just half are listening to commercial radio stations. Particularly in Denmark, the vast majority only listen to public radio and are therefore not reachable by ads.
Campaigns need to be relevant and delivered by the right media
Streaming and podcasts are rising in popularity amongst the younger generations, while radio is still popular amongst the older ones. What’s more, the findings clearly demonstrate consumers’ intent to pay for ad-free services, e.g. Spotify Premium and Netflix.
So with the rise of ad-free services, it becomes clear that planners and advertisers need to use all the tools at their disposal to ensure their campaign planning and targeting is cost effectively driving optimum in-target reach, against increasingly hard-to-reach audiences.
At the same time, broadcasters need to ensure they prove the effectiveness of their advertisers’ media spend with accurate and harmonised pre and post campaign measurement. Commercial radio and TV are very high-quality ad environments, so it’s also crucial they attain the best possible value for their audiences – partly in order to consistently raise programming budgets, to compete for consumers against the well funded ad-free streaming services.
Get further insights
In our new study, we break down music streaming, podcast and radio habits in the US, UK, Germany and the Nordics, to give you a complete overview of the industry and its trends. Also, we take a close look at radio consumption and uncover how many of those who are streaming music or listening to podcasts are also listening to ‘traditional’ radio. Finally, for each medium, we illustrate consumption habits amongst five different age groups, outlining how popular each medium is, by demographic.
The study is based on approximately 14.000 individual survey respondents across seven countries; The US, the UK, Germany, Denmark, Sweden, Norway and Finland.
Download the full study and get further insights now: