Spotify has unveiled its new strategy for its audiobook service, marking a significant development in the company’s efforts to expand its offerings. At an event held at its New York offices, Spotify introduced a fresh approach that will benefit Spotify Premium subscribers. Now, premium users will have access to a curated selection of 150,000 audiobook titles at no extra cost.
The initial launch of this service will take place in the United Kingdom and Australia, starting immediately, followed by a rollout in the United States later in the year, with plans to expand into more markets.
Spotify’s CEO, Daniel Ek, highlighted the ambition behind this move, comparing it to Spotify’s approach to music and podcasts. He expressed the belief that there is a significant demand for audiobooks, similar to music and podcasts, and the company aims to use its tools to enhance the discovery of these titles globally.
“Audiobooks today have one big dominating player. And just like in music and podcasting, we believe that many more consumers want to consume audiobooks and want to listen to audiobooks,” said Spotify founder and CEO Daniel Ek, speaking at the event.
Spotify Learnt From Findaway Acquisition
Spotify’s entry into the audiobook space began with its acquisition of Findaway, a digital audiobook distributor. They initially launched audiobooks in the United States in September 2022, starting with a catalogue of 300,000 titles before expanding to other English-speaking markets and eventually Canada in early 2023.
Spotify recognized the potential of the audiobook market, which was growing at an impressive rate, despite representing a relatively small share of the overall book market.
One of the challenges Spotify faced was navigating app store rules regarding in-app purchases, which led them to require users to purchase audiobooks from their website to play them within the app. This workaround made the user experience less seamless. However, by integrating audiobooks into the Premium service, Spotify aims to simplify the process of listening to audiobooks for its users.
Ek emphasized that this change not only enhances user engagement but also reduces churn and provides more flexibility to the company’s business model, ultimately benefiting its revenue and profit.
Spotify also identified a distribution and discovery issue within the audiobooks market and plans to apply its successful strategies from the music and podcasting realms to solve this problem.
Alex Norström, Spotify’s Co-President and Chief Business Officer, pointed out that millions of Premium subscribers are interested in audiobooks, but they need the opportunity to explore them. He noted that while 2 billion people are expected to read books in a given year, the audiobook segment remains relatively small.
Audiobooks Access to be Limited
Although Spotify initially launched its audiobook catalogue with 300,000 titles, only half of them will be accessible through the Premium subscription. Users will be limited to 15 hours of listening per month, but they can purchase an additional 10 hours as a “top-off.”
To enhance the user experience, Spotify will provide editorial recommendations and personalized suggestions based on users’ preferences. These recommendations will be featured in the audiobook’s hub, alongside shelves highlighting popular genres.
Authors will also benefit from new tools, including customizable promo cards and insights into their audiobook performance. Additionally, Spotify plans to personalize audiobook recommendations and feature them in the app’s Home feed.
As the service rolls out in supported markets, subscribers will easily identify which audiobooks are included in the Premium offering. Users will have built-in sharing tools to share their favourite audiobooks on social media and create audiobook playlists.
In summary, Spotify’s move to integrate audiobooks into its Premium offering represents a significant step forward in its quest to become a one-stop destination for audio content, with a strong focus on enhancing user engagement and simplifying the audiobook listening experience.