Spotify

Since its introduction to the American market in 2011, Spotify has made efforts to adapt in order to look more attractive to their target market, which are millennials. In 2015 Spotify changed the design of their brand, this included, the user interface, the logo, the ads they attempted to create a new brand identity to show that Spotify was as rich and lively as the music culture, rather than simply a technology service that served up songs.

Spotify's offers free service that runs ads between songs, but we can say the same about Youtube music, pandora, and illegal downloading, Spotify has 3 main competitive advantages the first one being its social networking features that allow listeners to share songs and playlists among friends on Facebook and Twitter. Their second advantage it's their use of listener's data to personalize the experience by using algorithms that can help surface the right content at the right time based on time of day and user context. Their final advantage that ties the last two, Spotify's user-generated playlists may be its biggest competitive advantage. Playlists created and shared by users accounted for 36% of listening hours.

Spotify has a customer centric strategy where the data customers provide through the app basically customizes an enviroment for each user where the music recommendations will be based in what they had listened previously, this also helps Spotify to improve their algorithms, to make better business decisions, to better market their product in different countries

The distribution of music has drastically changed since 1995 when the use of mp3 files became more frequent allowing users to share music through the internet and forcing record labels to adapt to consumer demands. Spotify instead of selling individual albums or tracks, they sell memberships that grants access to more than 50 millions tracks, great deal for fans. Spotify is a very simple example of online retailing that has proved great success, but this has not stopped other forms of music distribution, because physical goods like CDs, cassettes, vinyls, and merchandising are still profitable, Spotify acknowledges this shortcoming by allowing artists promote their merchandise and physical copies of their music on their page.