Does Spotify Really Help The Live Business?

Throw Your Analytics In The Air:
Nicholas Hunt / Getty Images / Spotify
– Throw Your Analytics In The Air:
A$AP Ferg performs at Spotify’s RapCaviar Live in New York at Hammerstein Ballroom Nov. 21, 2017, New York City. Ferg was one of the artists featured in Spotify’s “The Game Plan” video series on how to route a tour.

Streaming behemoth Spotify has been outspoken in its support of artists since 2006 when Daniel Ek co-launched the game-changing app straight outta Stockholm. The company states its case on its website: “Our mission is to unlock the potential of human creativity – by giving a million creative artists the opportunity to live off their art and billions of fans the opportunity to enjoy and be inspired by it.”

In case you’ve been living under a rock (guitar solo), Spotify is the most popular audio streaming subscription service in the world with, to date, 124 million premium subscribers (out of a total of 271 million overall users), and is available in 79 markets, featuring 50 million (and counting) tracks and 1 billion playlists. Spotify’s paid worldwide subscribers, at its most recent count, are more than double Apple Music’s 60 million and Amazon Music’s 55 million.

For the mainstream record industry, Spotify has helped deflect losses from piracy and the digital revolution and enabled both Universal Music Group and Warner Music Group to turn around their financial pictures on the way to IPOs that reflect that increased valuation. Still, artists like Camper Van Beethoven’s David Lowery, a professor at University of Georgia, have famously argued the service’s micropayments have created a world of haves and have-nots, with an increasingly beleaguered middle class. According to sources, musicians should expect to receive $7.50 for every 1,000 streams (that’s $7,500 for a million streams), with rightsholders entitled to between .006 and .0084 cents per listen, which is then divvied up between the record label, producers, artists and songwriters.  

With a public valuation that reached a high of $28.34 billion in August, and sunk as low as $19.65 billion in October, as much as a quarter of Spotify is owned by three institutional investors in Baillie Gifford, Morgan Stanley and T. Rowe Price Associates. According to SEC documents reviewed by Rolling Stone Spotify’s co-founders Ek and Martin Lorentzon, control 30.6% of the shares together, while Sony Music and Universal collectively are estimated to own between six percent and seven percent of the company after Warner Music Group divested its shares, and Chinese music titan Tencent Holdings – which made a 10% investment in UMG last year – holds a 9.1% degree stake.

Whether Spotify is a savior or the devil in disguise for the music industry, the company has been on a mission to sell the service to artists, including the use of its data in marketing and promoting their music, as well as planning their tours. 

“Spotify is trying to give the artists as many tools as possible in order to really manage their own sustainable careers,” says Nashville-based Three Lions Management founder Andrew Stanley, whose clients include cult singer-songwriter Conner Youngblood, after stints at CAA, Hard 8 Management and Neste Event Marketing. “But it’s hard to hear a beat in a room full of drums.”

As part of their Spotify for Artists program, the company provides an online component dubbed “The Game Plan,” with videos on how to organize and route a tour from artists like A$AP Ferg and Trippie Redd. Artists can also access their Top 50 U.S. cities and countries, based on global streaming numbers.

“Before Spotify, artists were dependent on the labels to get them this data,” says Spotify Senior Product Marketing Manager Charleton Lamb, a Harvard alum who specializes in assisting label and artist teams to get maximum value from the DSP. “We’re showing them where their music’s being listened to around the world. It opens doors and opportunities where there wasn’t even an idea.”

Long Live Rock ’N’ Roll & Analytics:
Graham Denholm / Getty Images
– Long Live Rock ’N’ Roll & Analytics:
“Girl in Red” aka Marie Ulven performs during Spotify’s Front Left Live at The Forum in Melbourne, Australia, Oct. 9, 2019.

Lamb says, while there’s no direct algorithm to connect streams with ticket sales, Spotify does its best to connect acts and fans by offering presale links to ticketing sites with email blasts and allowing performers to list tour dates on their individual artist pages. 

“Artists and labels are even sending streaming screenshots to booking agents demonstrating their regional appeal,” adds Lamb.

“It gives you visibility in places you wouldn’t necessarily have,” notes Stanley, pointing to Conner Youngblood opening for Milky Chance on a European tour, then being able to return to Berlin as a headliner. “And that’s all you can do with any artist. Put them in front of an audience and see if what they do resonates.”

Youngblood, signed to Counter Records, an imprint of Ninja Tune, first broke through by posting tracks to Hype Machine, where he received favorable notice in influential sites like Pitchfork, Pigeons & Planes and Consequence of Sound, eventually scoring on popular Spotify playlists such as Koffeehausmusk, Acoustic Chill and Indie Rock. “Any one with more than 500,000 followers will be impactful,” says Stanley.

Carly James, who posts her own Spotify playlist, has been a full-fledged agent at Paradigm Talent Agency since 2017 after coming over from The Agency Group, where she worked as a tour coordinator for Dave Kaplan. Among her current new and developing acts are British political rock band Idles, Cameroon-American multi-instrumentalist Lætitia Tamko’s Vagabon and Chicago psychedelic/art-pop auteur Alexander Brettin’s Mild High Club.

“Spotify data helps with where to start a band touring, but you have to be careful, because we all know streaming doesn’t necessarily equate to a hard-ticket sale,” she says. “But when tracking the growth in specific markets, it gives you a gut feeling about the size of the venue you want to book. Are we in a place where we feel comfortable going from a 250-cap to 600?”

James gives the example of another of her clients, 20-year-old Norwegian singer/songwriter Marie Ulven’s girl in red. Following the band’s first U.S. tour last year, Spotify analytics showed Dallas is one of the band’s Top 5 national streaming markets, so James booked them there on an abbreviated two-week run in April, along with Houston and Austin, in between weekend Coachella performances. “Spotify analytics really helped us determine the locations of those sweet spots,” explains James. “Having that knowledge enabled us to build the route for them.”

“Being aware of where in the world fans are engaging with our artists, and at what level, is always helpful,” agrees Aaron Summer, head of touring at Mick Management, whose roster includes Deer Tick, David Gray, Mandy Moore, Jon Batiste, Leon Bridges, Maggie Rogers, Ray LaMontagne, and Walk The Moon, among others. “We use it to decide what size room we’re going to play in each market.”

The firm’s Amy Beihl, head of digital strategy, pieces together all the insights from the various streamers, social media platforms, mailing lists and websites, attempting to “weave together the web to provide the artist’s team with the ammo to make the most informed decisions possible. It helps build a more complete picture.

“Spotify for Artists really does take out a lot of the guesswork. It fills in many of the gaping holes from just five years ago. Artists had no idea where their fans were, or which songs were resonating in a particular market.”

Several years ago, according to Mick’s head of marketing Jesse Jacobsen, Deer Tick canvassed its fans in each city and used Spotify engagement to create a customized set list for each tour stop. “It’s also a way of choosing the next single on your album,” he adds.

Increasingly, though, according to Three Lions’ Stanley, Spotify’s chief selling point – its accessibility – makes it difficult to break through all the static.
“Spotify gives you all the tools and the data to carry on, it helps you fine-tune things, but it’s so accessible, there’s too much noise, which makes it hard. And, outside of pop and country, terrestrial radio doesn’t serve the purpose it used to in breaking artists. It’s way too expensive for an indie to service a track to radio all over the world.”

“We’re finding Spotify is opening more doors to regions that we otherwise wouldn’t have known to access,” says Mick Management marketing chief Jacobsen, who points to the Philippines as one such potential territory for several of the firm’s artists.

“There’s so much power behind the information available to artists now,” adds the firm’s Beihl. “You can be very nimble in terms of ad creative for each local market, using the song that’s reacting the most in that region. It’s that type of precision we can now deploy.”

According to Spotify’s Lamb, that’s the idea: “Our goal is to empower artists of all sizes to be more in control of their careers based on actual listening data.