At a time when your friends may understand your mood or read your mind, it seems music streaming apps seem to have mastered the art of both. And then the playlist is further used to advertise related products. “Based on the songs you listen to, algorithms can accurately predict your mood, your temperaments, and based on some fine behavioural analytics, can also predict what action you will perform next. This data can be used by music streaming apps for targeted advertising on its platform, and sold to advertisers, nearly everywhere,” Saurabh Singh, CEO and director, Appinventiv, said.
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As per market research firm Statista, music streaming services have become a popular platform for advertisers to reach consumers, and several trends are emerging that are shaping the industry. One of the most notable trends is the increasing use of personalised ads, which use data analytics to deliver ads that are tailored to the listener’s preferences and interests. This has made music streaming advertising more effective and engaging, as listeners are more likely to respond positively to ads that resonate with their tastes. This market is expected to experience a compound annual growth rate of 2.96% (CAGR 2023-2028), resulting in a projected market value of $404.70 million by 2028.
While the process of collecting data may be similar, it is believed that every music streaming app has devised its playbook. For instance, Spotify claims to collect user data including music preferences, browsing history, and device details. It analyses user habits and enables personalised recommendations. The platform stated that it also leverages location data, and content voice data if voice features are used. Additionally, payment and purchase information, survey responses, and data from third-party sources. Moreover, Spotify receives inferences from those who have certain advertising or marketing partners. These inferences are partners who have an understanding of user interests and preferences, allowing it to deliver relevant ads and marketing. “By crunching this data, it creates a user profile, understanding your musical habits and preferences. This helps it recommend songs tailored to your taste and keeps you engaged,” Apurv Modi, MD and co-founder, Atechnos Group, said.
Meanwhile, time spent listening remains a common currency used by all music apps, stream count. “There are multiple other metrics streaming platforms are using to understand behaviours, habits and preferences; choice of music genres, types of playlists being created and shared, time at which the user is engaging on the platform and sometimes the location as well,” Sonia Parasnis, vice president- creative strategy and content programming, Hungama Digital Media, said.
Moreover, in terms of measuring user sentiment, these apps analyse thumbs up or down, skip rates, and even comments or reviews. According to Modi, all these metrics come together like pieces of a puzzle, helping platforms understand the overall sentiment of users. Moreover, experts note that most music streaming platforms use Audio Valence to measure the sentiment of a song. This is measured as a value between 0.0 to 1.0 where a higher value means higher positivity. So a song with a 0.48 valence will be more mellow sounding than a song with 0.9 valence. This data collected over time can accurately gauge the mood and sentiment of listeners.
Happy hour? Ads got something to say!
It is believed that ads shown at the right moment can trigger actions which typically a listener fails to anticipate. For instance, if a listener spends significant time listening to songs of heartbreak there is a probability of being shown ads on dating sites. Also, this means that there is a probability of her clicking on it. a “Ad targeted generally based on criteria such as demographics, interest cohorts and digital/ social media behaviour. Emotional Ad targeting is a deeper human aspect that can be a relevant factor in putting a brand proposition closer to the state of mind of the listener. This nature of targeting is still evolving and how the conversions turn up, will need to be seen in the future,” Chandrashekhar Mantha, partner, media and entertainment sector leader, Deloitte India, said.
Moreover, depending on the nature of the data, music streaming apps can personalise the entire user journey. It doesn’t just stop at music recommendations; the data gathered gives insights which can be then used to create interactive product features. “Emotional ad targeting is a clever strategy. When platforms understand your emotional responses to music, they can tailor advertisements that resonate with those feelings. When ads tug at your emotional strings, they aim to influence your decisions. If you’re rocking out to some upbeat tracks, and an ad mirrors that energy, it can make you more likely to engage with it. But you might find yourself more tempted to click, buy, or explore whatever the ad is offering because it resonates with your current emotional state,” Modi highlighted.
Privacy Ki Taal!
And while all this usage of data sounds anything but marvellous, the catch resides in managing privacy with the rollout of the Digital Personal Data Protection Bill (DPDP) Act. Platforms are now required to obtain user consent before collecting and using their data, and they must be transparent about how they will use it. The act also limits the amount of data that platforms can collect and requires them to store data in India. These changes give users more control over their data and make it more difficult for platforms to misuse it. “We’re continuously working to keep you in control of your privacy on YouTube—whether that’s helping manage settings with proactive tools, or making those settings easier to use in our products. And we do not sell user personal information to anyone. We use the information we collect to customise our services for you, including providing recommendations and personalising search results,” a YouTube spokesperson said.
One of the main facets of the DPDP Act is data minimisation. This means the platforms will only be allowed to collect the data that is necessary for their products and services. This will significantly limit the collection of the data and in turn, minimise the misuse of the same.
“A paradigm shift toward more responsible and user-centric data practices is exemplified by stricter governance, mandates for data localisation, and penalties for non-compliance. As the drapes ascend on this new part, sound streaming stages are organising an ensemble that blends personalisation, security, and the consistently developing elements of client experience,” Advit Sahdev, AI, digital marketing, and performance marketing expert, said.
Additionally, platforms have to ask for user explicit consent before they start tracking user moves. With the access to data being limited, to what extent do music streaming apps continue to provide a personalised experience, only time will tell…
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