Analyzing The Product Adoption Lifecycle For Music Streaming Services In India
Introduction
There is no doubt that technology in the past years has drastically changed the experience of many things. One such thing is of course the entertainment experience. There was a time when people like you and I would have to rely only on radio, cassettes, live concerts and so forth to hear the music of our choice. However thanks to the constant innovations, we are now able to listen to music in one click with the various music streaming services available in the market. As per Statista, the success of digitally recorded music is such that in 2019, it contributed to $20.2 billion globally.
Speaking of music streaming services, let us first quickly discuss what does this mean. To put it short and sweet, music streaming refers to the ability to listen to music without downloading it in any format such as .mp3, .wav, and others. Today there are plentiful options available to music lovers when it comes to music streaming. Some of these are paid subscriptions while there are free packages available as well. To name a few who provide this include Apple Music, Amazon Music, Spotify, YouTube Music, and much more.
Music streaming services in India
One of the nations where the growth of music streaming services seems promising is India. As per the prediction by Statista, the revenue generated from this service is to be around $393 billion by the end of 2020. This can be explained by several factors such as a large population of youth, growing availability of internet across the nation, and so on. Some of the top music streaming companies in India today include:
a. Gaana
One of the leading music streaming players that came ten years ago in the Indian market is Ganna. With more than 150 million users on a monthly base, this Android and IOS based app provides several features that allow listening to music to be an enjoyable experience. Gaana also has a web browser where you can browse in several regional languages.
b. Spotify
Spotify is another top music streaming provider in India. This app allows one to listen to a wide range of music as well as podcasts in several languages. You can also create your own playlist. Spotify has both free and paid versions that can be chosen from.
c. JioSaavn
Established in 2007, JioSaavn also has made its way to the top. This music streaming service provider offers tons of English, Bollywood, and other music of regional languages.
d. Hungama
For those looking for a place to listen to the music of different genres, Hungama is one such place. Both an app as well as website, this company offers songs of many genres such as Ghazal, contemporary, and so forth. One can also download the songs to their device if they like.
e. Apple Music
Apple Music entered the Indian market back in 2015. They offer three subscription-based plans to get access to a wide array of music. This app works both on android and IOS based devices.
f. YouTube Music
Another really popular music streaming company in India is YouTube Music. It came out after Spotify had begun to reach out to the Indian population. YouTube Music has two plans which one can opt from- one which is free and with ads while the other one is paid and ad-free. There is an app to avail of its services on both the android and IOS.
Where do the music streaming service providers lie in the product adoption lifecycle?
If we were to look at how much acceptance there is so far by the Indian population when it comes to music streaming, it would be somewhere in the early majority. This means that the concept of music streaming isn’t entirely new and that people are perceiving this to be an effective solution to their want of listening to music easily.
Profiles of product adopters (Innovators, early adopters, early majority and so on)
As we discuss the product adoption lifecycle, let us have a look at the characteristics of each group.
a. Innovators
These are the people who will be the first ones to get their hands on the product as soon as the product is released in the market. Some examples are journalists and reviewers. They keep a close eye on what is trending and what is not. Looking at the demographics, innovators are generally young in age, are financially very stable, are very outgoing kinds of people, and also are connected with other innovators. Innovators make ~2.5% of the population who adopts the product.
b. Early adopters
This group of people makes up around 13.5% of the market. Early adopters are the ones who are very strongly opinionated and most influential out of all the groups of adopters. Just as innovators, they too are young in age, financially stable, highly knowledgeable, and social.
c. Early majority
The ones who fall in this category take a lot more time to decide to use a product as compared to innovators and early adopters. Looking at the general characteristics, the early majority are above average in terms of social status. They spend a good amount of time researching the product and its reviews before selecting it. For any product company, to get to this stage means a huge success. The early majority make up almost 34% of the market.
d. Late majority
As the name suggests, the late majority are those who use the product long after it has come out in the market. They make up 34% of the market as well. The late majority are those who will do an extensive review of the product before becoming a user. In terms of demographics, the late majority have generally below average social status and are not highly financially stable.
e. Laggards
Laggards are the ones who will be the last ones to adopt the product. These people are generally elder in age, come from lower social class, are not highly financially stable, and are conservative. They will only accept change when they feel convinced after talking to their close friends and family. The laggards make up 16% of the market.
Factors and challenges which affected the rate of music streaming service adoption
First of all, it must be noted that music streaming companies have done a great job of overcoming the chasm. As mentioned earlier, not only do innovators and early adopters use this service, but so do the early majority. Some of the factors that contribute to the success of this include:
a. Large target market
With the music streaming services majorly targeting the millennials, India is a perfect place as millennials make up a very large percentage of the population.
b. Excessive marketing
Music streaming providers are working very rigorously to spread the word about their product. This has been done in so many ways such as advertisements on radio, tv, and digital platforms, campaigns, sponsoring events, and much more.
c. Consideration of price sensitivity
As the majority of India is price sensitive, music streaming companies have dealt with this by providing freemium versions of their products. This allows people to get a good taste before making the payment.
d. Increased affordability and accessibility of smartphones and data
For people to use music streaming products, it becomes mandatory to have a smartphone and data package. With both of these things becoming more affordable in the market, music streaming companies have been able to sell their product effectively.
While the music streaming service stands at a good point in the product adoption lifecycle, there is a still long way to go. Despite the increase in the use of music streaming apps, the number of paid users is very low. As per Amarjit Singh Batra, CEO of Spotify India, “Of the more than 350 million smartphone users in India, less than 1% are willing to pay for music.” Let us look at what are some of the reasons that contribute to this loss for the companies:
a. Price- sensitive market
While companies such as Spotify, Gaana, and others are providing freemium versions to their users, it still isn’t enough. A large number of people to this day in India do extensive research on whether the investment is really worth it. If there are alternatives available that provide the same thing at lower/no cost, they would rather opt for that. One of the services that provide tough competition to the music streaming companies is of course YouTube.
b. Pirate Services
One of the challenges that any music streaming company faces is piracy. There are sites available where people can download music for free. This is a large issue that music streaming providers in India are facing. Based on a survey carried out by Soundcharts, nearly 76% of internet users have used piracy websites to download songs into their devices.
c. Fierce competition
With India being a marketplace for so many competitors- both local and international, it certainly becomes a challenge for companies to really make their way to the top. The intense competition naturally causes the pricing of the products to be at the same price more or less.
Growth and product adoption comparison with other music streaming services
Here is a comparison of some of the domestic and international players in the music streaming market of India.
Growth hacks used
In order to overcome the challenges that hinder the growth of music streaming companies, here’s what companies such as Spotify and Gaana are doing:
a. Provide freemium packages to users
Since India is a highly price-sensitive country, music streaming companies are dealing with this by offering free versions of their service. This allows people to get a good idea of how the experience will be of using a particular service. The trial period ranges from 30 days to 90 days which is certainly enough to give a preview.
b. Integration with social media
As social media continues to be one of the top places where people can be found to be engaging, music streaming companies such as Spotify are really keeping this is in mind. Spotify allows its customers to be able to share the music they are listening to with their friends on Facebook and Tinder. This works pretty well for the music streaming companies as it is a way to reach out to more people.
c. Curated playlists
One of the growth hacks which all music streaming providers are using is of course providing curated playlists. Everyone is using technology such as AI to help create playlists for the user based on their likes and dislikes.
d. Money worth premium models
In order to increase the number of paid subscribers, music streaming companies in India are working to make the premium packages worth the money. As already discussed, they first allow the users to get a good taste of the experience. However, once the user has paid, they are offering lots of features such as curated playlists, unlimited downloads to listen offline, and listening to music with no ads.
e. Provide lite versions of the app for lower budget smartphones
While the usage of smartphones has risen significantly in the past few years in India, there are still a lot of people who are using lower budget smartphones. In order to ensure that the music streaming app works just fine on such phones, companies like Spotify are providing a lite version.
Conclusion:
Considering the challenges that music streaming companies (both domestic and international) face in India, it is must be said that so far, the overall progress is great. However, companies still have a lot more to do. By using the growth hacks mentioned above as well as being constantly innovative based on the situation, the music streaming industry will be able to get more adopters. With Covid-19 being one of the drastic situations for everyone, music streaming companies have a great opportunity to reach out to more. It will be definitely very interesting to see how these companies make use of this situation.
References
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