Posted on Oct 27, 2021 4:35 PMUpdated Oct 27, 2021, 5:17 PM
Spotify is reaping the first fruits of its gamble to boost its advertising revenue to supplement its main source of revenue: subscriptions. In the third quarter of its 2021 fiscal year, the Swedish music streaming platform saw its advertising revenue jump by 75%, to 323 million euros, or 13% of the total, while the proportion hitherto hovered around 10%. In front of analysts, Daniel Ek, the boss of the group, said that the threshold of one billion euros in turnover in this area would be exceeded for the first time this year.
After having diverted a large part of the radio listeners through its platform, Spotify does not hide that it is also targeting the gigantic advertising market of this medium – it weighs 15 billion dollars in the United States alone, against 20 billion for the entire world recorded music market. He wants to offer advertisers precise targeting thanks to the data he has on his listeners. It would only be replicating what web giants like Facebook are doing in audiovisual advertising in front of television.