1. ASSIGNMENT 1 - INITIAL COMPANY RESEARCH
Student Name: Sequoa Carter
Date: March 4, 2022
COMPANY: (Include in-text citations)
Parent Company (or Holding Company) Name: Spotify Technology S.A
Brand/Division/Subsidiary Name: Spotify USA Inc.
https://www.linkedin.com/pulse/confused-terms-subsidiary-affiliate-division-others-gary-kirshenbaum
Parent company structure: (begin with a brief history, mention its relationship to the brand you
selected, and note its current financial position below):
Spotify Technology S.A is one of the most popular music streaming services that offer artists a
wide range of music, podcasts, and marketing tools. Spotify is a Swedish company created in
2008 by Daniel Ek and Martin Lorentzon as only a music streaming service available by computer
in European countries. Spotify USA is the subsidiary of Spotify Technology S.A. It is a mobile app
with music, podcasts, and marketing tools for musicians that became available for people in the
United States of America in 2011 (History-biography, 2019).
Brand/Division/Subsidiary Detail (begin with a brief history, identify the CEO, and what part in
plays in the success of the parent company, i.e. percent of business):
Spotify USA was created in 2011 and was launched in America by the founder and CEO Daniel
EK. 25% of Spotify users are American, and 44.7 million of them are premium subscribers out of
180 million premium subscribers around the world (Statista, 2022). Spotify USA has a market
share of 31% in the U.S which is large compared to other countries (Forde,2021). Spotify USA
plays a success in its parent company because of its dominance in the U.S market and premium
subscribers in the U.S.
Parent company financial position (Refer to assignment attachment: “Financial Information
Source” for these five financial measures. Remember to include currency and year.)
Year over Year (Stock price going up or down? Give stock price at beginning and end of the
most recent 5-year period):
The Stock Price for Spotify (SPOT) went up from 2018 to 2021
Stock price December 23, 2018: $112.16 (Yahoo! Finance, 2022)
Stock price December 26, 2021: $234.03 (Yahoo! Finance, 2022)
+$121.87 (+52.07%) in the last five years
2. Compare stock performance to a market index (note the percentage of change in the
market index, and compare it to the percentage of change in the stock price for the same
period):
The Stock Price for NASDAQ went up from 2018 to 2021
Stock price December 23, 2018: $6,584.52 (Yahoo! Finance, 2022)
Stock price December 26, 2021: $15,644.97 (Yahoo! Finance, 2022)
+$9,060.54 (+57.91%) in the last five years
Net Income: -34,000 (Yahoo! Finance, 2022)
Net Profit Margin: -0.35% (Yahoo! Finance, 2022)
Debt to Assets Ratio: 0.70 (Yahoo! Finance, 2022)
3. BUSINESS LINES OF BRAND OR DIVISION (Include in-text citations)
Include a description of the Product or Service Line and the Product or Service example. Do not
assume your decision-making client knows what “Mass Effect” is. She may be an Accounting VP,
not a gamer. Emphasize benefits to potential and current customers.
Product/Service line A
Spotify Premium Individual Subscription
Example of Product/Service line A:
This is the basic one-person subscription plan for $9.99 a month, free the first month. It includes
one account, ad-free music, and podcasts. It gives you the ability to play music anywhere, even
offline, and it has on-demand playback (Spotify AB, 2022).
Product/Service line B
Spotify Premium Student Subscription
Example of Product/Service line B:
This is a one-person subscription plan for college students priced at $4.99 a month, free the first
month. It includes one account, ad-free music, and podcasts. It also includes SHOWTIME
streaming and Hulu with ads (Spotify AB, 2022). It gives you the ability to play music anywhere,
even offline, and it has on-demand playback.
Product/Service line C
Spotify Premium Family Subscription
Example of Product/Service C:
This is a six-person subscription plan for $15.99 a month, free the first month. It includes six
accounts, ad-free music, and podcasts. It gives you the ability to play music anywhere, even
offline, and it has on-demand playback. It blocks explicit music and offers Spotify Kids a
separate mobile app for children (Spotify AB, 2022).
4. TARGET MARKET FOR BRAND OR DIVISION (Include in-text citations)
Complete these segmentations for each Example of the Product/Service you identified above.
Segment the Market according to what you learned in Introduction to Marketing. Be specific.
Avoid broad generalizations like “worldwide”, “everyone” and “all ages.”
Example of Product/Service line A: Spotify Premium Individual Subscription
Geographic: United States, specifically Texas, Colorado, Washington, Arizona, and Florida
(Geier, 2021)
Demographic: 56% are males, and 44% are females between 25-34 years old that are
considered millennials (Hlebowitsh, 2022).
Psychographic: This person likes to stay fit and plays video games in their free time. They
consider themselves “foodies”. They like new tech, cars, sports, and shoes. They believe in
equality, and diversity (Ypulse, 2017).
Benefits Sought by consumer: They now get newly released music, and podcasts without
advertisements. They can stay up to date with favorite artists.
Usage Rate of consumer: Moderate
Example of Product/Service line B: Spotify Premium Student Subscription
Geographic: United States, specifically Texas, Colorado, Washington, Arizona, and Florida
(Geier, 2021).
Demographic: They are a single college student. 44% are females, and 37% are males
between 18-24 years old(National Center for Education Statistics, 2021).
Psychographic: This person enjoys doing anything eco-friendly, and they like to be with
friends. They believe in diversity, equality, and body positivity. This person likes to stay
healthy and focuses on their body image. They value education, enjoy streaming services, and
binge-watch TV (Ypulse, 2017).
Benefits Sought by consumer: They now have affordable music streaming all day, and a
plethora of TV shows, and movies to watch.
Usage Rate of consumer: Heavy
Example of Product/Service line C: Spotify Premium Family Subscription
Geographic: United States, specifically, Texas, California, Arizona, Colorado, and Virginia
(Florida,2019).
Demographic: 56% of males and 44% of females between the ages of 25-34 are considered
millennials, households with children in school (Hlebowitsh, 2022).
Psychographic: This person enjoys family time; they believe in getting an education. They also
like to go out to new events and venues. They value traditions and celebrating holidays. They
like to buy products that contribute to their health and well-being.
5. Benefits Sought by consumer: They now have affordable music streaming for the whole
family in one place. They can monitor children’s music consumption and easy access to music.
Usage Rate of consumer: Heavy
6. DIRECT COMPETITION FOR YOUR BRAND OR DIVISION (Include in-text citations)
Each Competitor’s Product/Service below should align with the Examples of your company’s
Product/Service identified above. For example, Competitor Company 1 Product/Service below
should be compared to Example of Product/Service line A above.
Name of Competitor Company 1: Apple Inc.
Competitor Company 1 Product/Service: Apple Music: Individual Subscription
Competes with your Product/Service A: Spotify Premium Individual Subscription
Name of Competitor Company 2: Deezer
Competitor Company 2 Product/Service: Deezer: Student Subscription
Competes with your Product/Service B: Spotify Premium Student Subscription
Name of Competitor Company 3: Amazon Inc.
Competitor Company 3 Product/Service: Amazon Music Unlimited: Family Plan Subscription
Competes with your Product/Service C: Spotify Premium Family Subscription
Rank the 4 companies (each Competitor Company listed above and the Company you selected
for this Assignment). List the companies in order of success. Rank the most successful as #1.
Include the metric/numerical evidence used as the basis of the ranking. The metric/numerical
evidence can be annual revenue, annual profit, ticket sales, concert tour revenue, fan base size,
twitter followers, consumer reviews, age of company, size of company, etc. DO NOT USE current
stock price as a measure of success, since it does not offer the necessary context.
Ranking:
Company #1: Spotify (180 million subscribers) (Götting, 2022)
Company #2: Apple Music (78 million subscribers) (Götting, 2022)
Company #3: Amazon Music (55 million subscribers) (Music Ally, 2022)
Company #4: Deezer (16 million subscribers) (Music Ally, 2022)
7. FINDINGS: (Include in-text citations)
Research leads to findings. Summarize your findings here in two or three well-developed
paragraphs (a well-developed paragraph will contain 4-6 sentences). Describe your findings
(data), and note whether it was significant or not. Explain what the data you found implies, or
says, about your subject. Avoid overstating the importance (“XYZ is sure to dominate the
competition for years to come!”). Try to be objective in your description. Use both quantitative
and qualitative data from your research:
Spotify USA is one of the most popular music streaming services in the 21st century. They rank
number one in subscribers. However, their financial statements do not reflect. One of the
reasons for this would be their most vicious rival Apple Music. Apple Music generates more
revenue because of higher payout amounts and subscription-only plans, which leaves Spotify in
a bad situation. (Curry,2022).
Nevertheless, there is still hope for Spotify. They create new ways for artists and fans to
communicate and continue changing and surprising people with their playlist
recommendations, podcasts, sound quality, free subscription, and social engagement tactics
(Vicente, 2021). According to Shaw (2021), podcasts could help Spotify profit within their
business. This looks promising for Spotify considering their target demographics are mostly
male millennials, which is what most podcast listeners consist of (Götting, 2021). Furthermore,
despite the backlash Spotify receives regarding their low payout rates, they have the most
subscribers because of their ability to keep the interests of millennials, who are the most
dominant consumers of music streaming platforms (Shevenock, 2020).
Spotify will remain the most famous music streaming service because of its tremendous efforts
towards independent musicians. Compared to Apple Music, Spotify has more detailed analytics
for its artists (Tech Council Ventures, 2022). This means that they have much power because
independent music artists are more favored in the music industry today. Spotify is innovative
and will always find new ways to impact the music industry and shape music. Spotify is here to
stay.
REFERENCES: (APA Format)
List at least 3 references below using the APA long form guidelines for formatting. Each reference
must also have a corresponding in-text citation above to show where it was used. It must be
formatted using the APA short form guidelines. Each of the five sections above (Company,
Business Lines, Target Market, Competition, Findings) must include at least one in-text citation.
8. Amazon Inc. (2022). Music. Amazon. Retrieved March 6, 2022, from
https://www.amazon.com/music/unlimited/family
Apple Inc. (2022). Apple Music. Apple. Retrieved March 6, 2022, from
https://www.apple.com/apple-music/
Curry, D. (2022, January 11). Apple Music Revenue and Usage Statistics (2022).
Business of Apps. Retrieved March 6, 2022, from
https://www.businessofapps.com/data/apple-music-statistics/
Deezer. (2022). To start listening, just pick a plan. Deezer. Retrieved March 6, 2022, from
https://www.deezer.com/us/offers/History-biography. (2019, December 3). Spotify. History
and Biography. Retrieved March 6, 2022, from https://history-biography.com/spotify/
Florida, R. (2019, January 16). Which U.S. Cities Have the Most Families With Kids?
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families-with-kids
Forde, E. (2021, October 13). Spotify to pass 100 million users in the US by 2025 while
pandora continues to slide. Forbes. Retrieved March 6, 2022, from
https://www.forbes.com/sites/eamonnforde/2021/10/13/spotify-to-pass-100-million-users-
in-the-us-by-2025-while-pandora-continues-to-slide/?sh=1e7b7b776d85
Geier, B. (2021, March 30). Where millennials are moving - 2021 edition. SmartAsset.
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moving-2021
Götting, M. (2022, February 8). Apple Music subscribers 2015-2021. Statista. Retrieved
March 6, 2022, from https://www.statista.com/statistics/604959/number-of-apple-music-
subscribers/
Götting, M. (2021, July 20). Monthly podcast listeners U.S. by gender 2021. Statista.
Retrieved March 6, 2022, from https://www.statista.com/statistics/188967/distribution-of-
us-podcast-consumers-by-gender/
Götting, M. (2022, February 2). U.S. Spotify Listenership 2020. Statista. Retrieved March
6, 2022, from https://www.statista.com/statistics/294640/spotify-listenership-in-the-us/
Hlebowitsh, N. (2022, March 3). 50+ statistics proving spotify growth is soaring in 2021.
Siteefy. Retrieved March 6, 2022, from https://siteefy.com/spotify-statistics/
Music Ally. (n.d.). How many users do Spotify, Apple Music and streaming services have?
Retrieved March 6, 2022, from https://musically.com/2022/02/03/spotify-apple-how-many-
users-big-music-streaming-services/
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cemarketing_core_brand%2Bcontextual-desktop%2Btext%2Bbmm%2Bus-
en%2Bgoogle&gclid=CjwKCAiAsYyRBhACEiwAkJFKomKgJZgZypG6cV2Ir790kD24DcMt
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Tech Council Ventures. (2022). What metrics matter the most on platforms like Spotify &
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Vicente, V. (2021, October 29). 6 awesome Spotify features you should be using. How-To
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Yahoo! (2022). Spotify Technology S.A. (spot) income statement. Yahoo! Finance.
Retrieved March 6, 2022, from https://finance.yahoo.com/quote/SPOT/financials?p=SPOT
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