Rhapsody gives an honest appraisal of TV advertising tactics

Another great piece has popped up over at sidewinder.fm. John Maples, VP of Product and Content at Rhapsody, has written a brilliant article detailing Rhapsody’s past efforts at TV advertising, and why he thinks Spotify and Rdio are going about it in the wrong way. I’d encourage you to click through the above link to read the article in full, though I’ll pull out a few key highlights below:

I know this is revolutionary, but it turns out you need to show what a service does to actually sell…the service!

If we’re going to be successful, we all have to start with the service, up front and center.

Since neither of our companies sell advertising, Rdio and Rhapsody are in the business of sourcing, identifying and enticing fans who are willing to pay for music. How you go about that is the hard part. My belief is that streaming companies have to sell the value of a music service and the benefits to customers instead of relying on an emotional connection to music, giving songs away or buying exclusive rights to a band’s new release.

There are two key issues raised here.

  1. Music services have been going about engaging TV audiences in the wrong way, by appealing to their emotions (“music is important to me, so of course I’m happy to pay for it!”), rather than their logical thought processes (“that service actually looks really useful, I’d happily pay $X a month for it!”). 

    For an illustration of how it should be done, we need look no further than Apple’s adverts for the iPhone, iPad, iPod, etc. which are essentially stylised video demonstrations of how the items operate.

  2. There is a clear distinction between people who are willing to pay for music, and those that aren’t. A lot is made of price sensitivity, and the $10 a month price barrier, though this is overblown. The bare fact of the matter is that those who value music and have a modicum of disposable income are happy to pay for convenient, ad-free access to a music subscription service (assuming that’s how they choose to consume their music in this day and age). The rest of the population simply have no inclination to start handing over $X a month given that the world’s largest collection of online music (YouTube) is available to listen to for free anytime they choose. Putting up with a few ads in order to keep the subscription fee in their pockets is, if you’ll excuse the pun, a price worth paying.

‘Daisy’, Beats by Dre, and the Power of Celebrity

Those of you who read the erratic, often irrational, but always entertaining Lefsetz Letter are no doubt familiar with this Gizmodo article detailing how Beats totally screwed Monster when they got into bed with HTC. You really should take the time to read it if you haven’t already. Whilst Noel and Kevin Lee, the father and son pairing in charge of Monster, were well and truly turned over by Jimmy Iovine and pals, it’s hard to feel sympathy for the owners of a company that regularly charge upwards of £200 for HDMI cables. (Hey, if there are people out there stupid enough to buy them then why not, I guess?)

But what I found most intriguing about the article were the clues it gives as to how the Beats team will go about marketing their music subscription service when it launches later in the year, currently codenamed ‘Daisy’. Jimmy’s an incredibly smart man, and more importantly he’s surrounded himself with the best in the business. Trent Reznor is on board as Chief Creative Officer, and Topspin head honcho Ian Rogers has been named as the incumbent CEO. Both Trent and Ian bring a wealth of digital music nous and contacts to the table, and they must have the existing big players in the digital music space looking over their shoulders in anticipation/trepidation for when Daisy finally gets up and running. But just how will they go about grabbing market share in a field that’s already become so crowded in such a short space of time? Spotify, Rdio and Deezer are all establishing names for themselves (some more than others), and the two biggest players are still yet to step into the ring (Apple and Google for those of you that couldn’t guess). Well, here’s an excerpt from the above linked article detailing how Jimmy Iovine explained to Kevin Lee they’d make a splash in the headphone market:

The Dr. Dre task force took Monster’s audio gear and pimped it, tirelessly, as a gadget status symbol without rival. That was the plan—period. Marketing, Iovine told Kevin Lee, would take too long. Education would take too long. Instead, the strategy was to enchant the public: Beats would be “the hottest product to have, and sound will be a Trojan horse. And that’s what we did. Beats was in every single music video,” says Kevin. Iovine made sure Beats had prominent placement across Interscope’s sterling roster, infiltrating the money and product lust-addled brains of video-watching America.

It worked. Disposable income was disposed of in the hundreds upon hundreds of millions. “Kids did go into a Best Buy and bought Beats not because it sounded cool, but because it made them look cool,” admits Kevin. The Lees were putting their audiophilic necks on the line to prop up what was, essentially, a fashion company. Beats’ dominance is clear whenever you walk down an American sidewalk—the Bs swarm. Jimmy and Dre took decent headphones that could swamp your ears with low-end, isolate you from street noise, and keep your skull relatively comfortable during a long walk, and made all of these qualities irrelevant under a sheen of rapper-lure. 

So basically: forget marketing the quality of the product and what it can do – instead leverage the power of celebrity and the public’s appetite for perceived wealth/status. Quite how they’ll transfer this tactic to a music subscription service remains to be seen, but it’ll certainly be exciting. I’m imagining endless celebrity/brand playlists and video/TV/film placements, and not less than a few exclusives. Seeing as Jimmy’s so high up at Universal, I imagine they’ll have quite the ‘vested interest’ in the project, and will no doubt do what they can to help it get up and running (e.g. “Listen to Justin Bieber/Lady Gaga/etc.’s new album, exclusively on Daisy!”).

A penny for Daniel Ek’s thoughts on the matter…