Product adoption life cycle of music streaming services in India.
Introduction
India, a country where people have traditionally relied on radio and television to listen to music, now has over 200 million listeners using music streaming services.That figure will be closer to 250 million, if you count overlapping users’ accounts separately.
While global players such as Spotify and Apple Music are trying to find their footing in the market, local players like gaana ,jio saavn have already attracted millions of users with sizable catalogs of Bollywood soundtracks, spiritual music, and regional favorites.
Music streaming industry in india.
- Revenue in the Music Streaming segment is projected to reach US$393m in 2020.
- Revenue is expected to show an annual growth rate (CAGR 2020–2025) of 7.1%, resulting in a projected market volume of US$555m by 2025.
- User penetration will be 3.1% in 2020 and is expected to hit 4.4% by 2025.
source: Statista’s music streaming report
Product adoption curves
In most product adoption models, there are five distinct stages. Each stage represents an arbitrary amount of time, so what’s most important here is the process as a whole.
Music streaming India is in Growth stage i.e Most service providers are in Early majority or Later majority stage
Stage 1. Innovators
The innovators are the first group of people to invest in your product.
This is a unique group. People who buy super early are usually obsessed with SaaS and want to keep up with the cutting edge of SaaS technology.
However, this group can have lots of variety in terms of specific customer types. For example, maybe someone just really needed your exact product.
What’s most important about this group is its size. You might have noticed that it’s small. That’s completely normal.
This is why you might only get a few sales immediately after you launch. You’ll typically get about 2.5% of your total sales from innovators.
Stage 2. Early Adopters
At some point, you’ll see a swell in sales, and you’ll start to get a steadier conversion rate.
This is probably because the early adopters have arrived.
Like innovators, early adopters tend to be ahead of everyone else, willing to test the waters.
Although early adopters are similar to innovators, there are some important differences.
It could be the case that early adopters have purposely waited to buy your product.
Whereas innovators are fine with rushing in and testing out something new, early adopters are a bit more hesitant. They still want to try something new, but they want a few reviews to consult.
Then again, it could be the case that they just found out about your product.
Expect your percentage of adoption to go up to about 13.5% or so.
Stage 3. Early Majority
Here’s when your product really gets some momentum going.
You’ve got a good amount of sales from innovators and early adopters. At this point, usually an even larger group sweeps in and gives you a heck of a lot more sales. Specifically, about 34%.
The people in the early majority are usually pragmatic and will only buy something once it’s been road-tested (at least a little bit) and has proven its value.
This is the beginning of your product’s peak. Maybe it’s gained traction with more marketing or word of mouth.
Stage 4. Late Majority
At stage 4, your product has been out for a while, and there’s widespread use.
However, there are still some people who are a bit skeptical of your product. Once they’ve put their worries to rest, they buy your product, and these people are usually in the late majority or laggards.
At some point during the early or late majority phase, you’ll have your peak where you get more sales than ever, and your product is at the height of its popularity.
Interestingly, in terms of adoption rates, the early and late majorities are usually roughly equal, around 34%.
Stage 5. Laggards
These are the people who buy your product after all the hype has died down. Sometimes, laggards purchase a product years after it’s been released.
Laggards might be extreme skeptics or people who have only heard about your product a long time after you launched it. Whatever the reason, these people don’t buy until much later in the product lifecycle.
Surprisingly, this is a pretty big group. 16% of your product adoption will come from laggards.
Factors and challenges which affected the rate of music streaming service adoption.
Pricing of Mobile data: The introduction of Reliance’s Jio SIM in 2016 — which caused mobile data prices to drop drastically — that music streaming apps started gaining users rapidly. That growth has attracted global players such as YouTube Music, Amazon Prime Music, and Spotify in the past couple of years.
Free music streaming: Ad supported free music streaming has attracted new users. These apps offer their full catalogs to people for consumption with an ad or two after a few songs. The draw of free tracks is huge across the country, and ads are a small price to pay for that privilege. There are very few people who are ready to pay for music or content in India.
Piracy: In small towns of India, there are still shops that offer to load music and videos to their phones for a nominal fee. Plus, easier to get pirated songs in MP3 format from friends through file-sharing apps. Piracy laws have become stringent but still the implementation has been lax.
Pricing of services: Most services are priced between Rs 99-Rs129 a month.For access to all content.But for price conscious indian customer this may be high.Average indian customer may not listen to global music.
Growth and product adoption comparison with other music streaming services
Growth hacks used by streaming companies
spotify: Spotify has worked on its reach to the rural market by launching its lightweight app.Also they have launched per day, weekly, customized premium plans as low as Rs.13 per day which are very lucrative offers.
Spotify is banking on localisation and podcasts to drive growth in India’s crowded music streaming market.
Ganna:
According to ganna voice search feature to drive the consumption over the next two years, as millennials find it convenient and most of its new-users would be from vernacular background who would prefer using the voice search than typing in English, he said.
Amazon music:
Amazon Prime customers get on-demand, ad-free access to over 2 million songs through the Amazon Music service. There’s no added fee or subscription for this, apart from the regular Prime membership. It’s a nice perk if you’re not a picky listener and just want something without ads.
Integration with alexa.
Future outlook
With smart phone penetration to increase in india and reach 829 millon in 2022.The potential is quite large with the ever-growing demand of streaming content.
