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Customer Relationships
Key Activities
Value Propositions
Customer relationships
- Communities of businesses
- Emerging technologies (online sales & streaming services) to incentivize the dissemination of music
Key activities
- Production and distribution of music
Value propositions
- Music brand with the largest music catalogue worldwide
- Great value for the artists discovered by this label
- Artist signed up with UMG can be importnat for marketing purposes
Customer Segments
Key Partners
Key Resources
Channels
Key partners
- Physical and digital distributors and resellers
- Artists
- Media companies (licenses)
- Merchandising companies
- Sponsorship & Advertising Partners
Customer segments
- Mass market business model with a multi-sided market (UMG approaches to different geographic markets)
- Average music consumer (addressing different music genres)
- Artists (whom UMG offers publishing to)
- People who attend live concerts (through merchandising activities)
- Other businesses (Partnerships & Branding)
Channels
- Digital stores
- Physical stores
- Digital channels (radio, tv, social media)
- B2B
Key resources
- Human resources (pool of artists and media management talent)
- Intellectual property (UMG music catalogue)
Costs
Revenues
- Physical and digital sales
- Licensing
- Publishing
- Merchandising
Revenues
Costs
- Manufacturing and distribution costs
- Royalty and copyright
- Recording
- Marketing & Advertising
- Salaries and employees benefits
- Consulting and service fees
Value proposition
- Listening to a large library of songs available in streaming and download
- Affordability: the service is available on different platforms and it's easy to access
- Convenience: free access with some limitations and premium access
- Sharing: connecting people
Value proposition
Customer Relationships
The affordability of Spotify's use is evident also through the services which the company offers: on the website we can find a section of Request&Answer for the users who face issues with the platform.
Customer Relationships
If you can't resolve your problem you can turn to the community where users and Spotify's employees engage each other.
Customer Segments
Mass market: Spotify offers its service to everyone who has a web connection, first of all young people. There are different prices for different kind of users.
The segmentation of price is:
free account
0.99$ to make zapping
4.99$ for students
9.99$ premium account
14.99$ for family (up to 6 accounts)
Customer Segments
Channels
Store & App
Store & App
According to spotify's nature, it uses digital channels to keep in contact with users.
In particular the store is online and the app is created to make easy the access to the service offered.
Music transformation
Revenues
Although Spotify offers a free service the most of its receipts is made up by subscription fees.
The rest consists of advertising.
Key Activities
Marketing: since Spotify's brand is new it needs to be known and that's why it joins forces with other enterprises. Moreover it buys inserctions on websites to promote itself
Research and development: Spotify is figuring out which is its structure.
Key Activities
Improvement technology: Spotify's engineers work in order to develop new software to point out the users' preferences. Furthermore if new tecnological device is launched on market Spotify will be ready to make his app available on it.
Key Resources
Key Resources
First of all Spotify needs a good web connection and technological tools such as ample clouds. They are full of songs of different music genres and they are tools to satisfy users.
Spotify also counts on very competent employees who are encouraged to feel free to propose new ideas to improve the enterprise.
Key Partners
Key Partners
Spotify purchases the products of his market from record companies which represent the major partners for Spotify.
Furthermore Google and Amazon are seller of some essential product.
Costs
Nowadays Spotify has spent more than his revenues especially because of licensing fees but also development and marketing costs.
Costs
Comparisons
Value Proposition:
Spotify just distributes music through digital platform while UMG produces artists and sells their music.
Customer Segments&Relationships
Channels
Customer Segments: both are referred to mass market even if Spotify adresses to a bigger young public. Moreover UMG addresses to artists.
Customer Segments&Relationships
Channels
Customer Relationships: both the businesses are in contact with the consumer public through communities.
Channels: Spotify uses only digital market while in addition UMG uses physical stores and B2B too.
Key activities, resources, partners
Key activities: the most important difference between Spotify and UMG consists of music production. Spotify must acquire songs' licences which UMG owns.
Key resources: Spotify relies on digital instruments whereas UMG invests on famous and promising singers and relevant lawyers to obtain intellectual property.
Key activities, resources, partners
Key partners: UMG has to collaborate with stores which offer the possibility to purchase physical music and gadget sponsored by artists. Instead Spotify worries about amplifying its clouds. Spotify rappresents a good partner for UMG and vice versa.
Costs And Revenues