Spotify's New Moat: The Sound Capsule
It not only captures the user's music identity but also helps them to tell the world about it.
Moats
A product moat is a unique advantage that a product has which makes it difficult for competitors to replicate. It's like a protective barrier around the product that helps it maintain its market position and profitability over time.
Some key aspects of a product moat in layman's language:
It's something special about the product that customers really value.
It's hard for other companies to copy or do as well.
It gives the product a lasting edge over competitors.
It helps keep customers loyal to the product.
It allows the company to maintain good profits from the product.
Source : Perplexity
The Aha Moment
Today, I shared this image from my Spotify app to Instagram because I felt incredibly proud to be a top fan of Anoushka Shankar.
This made me realise that I had been using Spotify a lot even though I had paid versions of other music apps on my phone.
All of these events led to an aha moment where Spotify as a product had tapped into my music identity, which is probably the peak of all moats a music streaming app can achieve.
Spotify Wins My Loyalty
I’m incredibly passionate about music products largely because I am a heavy consumer of niche music.
At this point I have premium subscriptions of Spotify, Apple Music and Youtube Music. Amazon Music is also available to me as I’m a Prime subscriber. But I don’t use it as much.
The reasons why I use each of these apps are summarised below:
Youtube Music
Youtube Music helps me access certain songs not covered in Apple Music or Spotify
People recommended this because they say that the recommendation engine is far better. But I don’t see this benefit explicitly
Now it’s still with me because of Google One subscription that I’ve shared with my mom.
Apple Music
Apple Music has better aesthetic sense. When I share something to my Instagram, the graphics look better.
I can share lyrics along with song in a more elegant manner.
In addition, some of the songs have superior audio quality when listened via AirPods.
Spotify
Spotify helped me access public playlists that are often shared on Twitter.
The low latency while listening to music in the metro or low network areas is quite impressive.
I had given up on this app as others caught up on unique features like Wrapped, etc. But the ‘Sound Capsule’ feature has got me back into this loop.
But of late, I listen to music mostly on Spotify because I want my monthly insights and statistics. This way I can know how crazy I am about an artist or how much time I have spent while listening to music vis-a-vis others.
The Sound Capsule
Spotify’s value prop was also slowly going down because its competitors were offering a bundled service (Google One provides access to storage space, YT premium and YT music. Similarly Apple One and Amazon Prime are bundled services).
Many have written a lot about Spotify Wrapped and how it has made Spotify a cool company that recruits its users to campaign for them without their knowledge.
But this was mostly an annual ritual. Nobody would stick to the product for an entire year to reap benefits of this particular feature. Now the monthly tracking feature christened as “Sound Capsule” has been created and made a paid feature.
So, maybe someone really figured out how to tap into the user’s pride in their music taste to retain them as paid subscribers. So, among other things, they probably came up with the idea to provide listening analytics on a daily basis.
And these stats are probably even more enticing for a power user to track.
For example, I can track how many minutes I have listened to music in a given month. And this stat updates on a daily basis. What will I do with this info?
It doesn’t serve any specific need apart from tracking days on which I had earplugs on for a longer time.
However, the stat captured above become invaluable when it becomes a comparative one. How much of a big music fan am I in comparison to others?
This stat becomes a bragging right in itself. Apparently my music consumption is 191% more than that of an average music fan in India.
Once I start getting these kinda insights month after month, my allegiance to Spotify keeps on increasing unless another music app can quench my curiosity in a similar manner.
My prediction is that Apple Music, Youtube Music and Amazon Music will eventually build a continuous music stat tracking feature for their users just like how they copied Spotify Wrapped.
Update:
Youtube launched the first music listening summary. But the first viral and successful version of such a music summary was that of Spotify. Technically, the idea was copied by Spotify.
Apple Music has already launched a monthly summary but it is not as intuitive and easy to access as Spotify’s Sound Capsule