Spotify is hoping to sign up millions of new subscribers to its streaming music platform through a new partnership announced today with Starbucks.
“We are trying to grow in the millions,” said Jorge Espinel, Spotify’s Global Head of Business Development in an interview with GeekWire.
When asked specifically if Spotify is hoping the partnership with Starbucks will result in millions of new subscribers, Espinel said, “Yes, I think this can be a powerful tool for us. That’s our objective.”
The partnership between the coffee giant and streaming music service is notable because it represents the first time that My Starbucks Rewards members will be able to use their points on anything but redeeming free cups of Joe.
In this case, they can be used on paying for a Spotify subscription, which normally costs $9.99 a month. A premium subscription provides users with no ads, better sound quality and the ability to download and listen offline.
Adam Brotman, chief digital officer at Starbucks, said the partnership made sense from its end for a number of reasons, including Starbucks’ history in innovating around music.
“We were one of the first chains to involve the playing of custom program music to stores back to the 80s, and we sold our first-ever compellation CD in the 90s,” he said. “We’ve done things in our mobile app and with social media. This is just the next step in evolution.”
It is also the first step in opening up its rewards program to outside companies.
“We believe this is just the beginning to innovate around the program,” he said. “We’ve talked about this before publicly, and we believe there’s opportunities to expand.”
Through the partnership with Spotify, Starbucks plans to integrate its in-store music platform with its loyalty applications to provide more tools to the consumer.
For instance, now when an irritating song comes on, customers will be able to do something about it, by influencing what’s being heard. Starbucks customers will also be able to learn what’s playing through the Starbucks app, or stream a Starbucks playlist when not in the store.
Details on how it will work are still up in the air, but will become available closer to when the service goes live this fall. It will first launch in the U.S., and then later in the UK and Canada.
Spotify’s Espinel provided some clarity on how he expects these new experiences to add up to millions of new subscribers, adding to its existing base of 15 million paid subscribers. The first way will be signing up the 150,000 U.S.-based Starbucks employees, called partners, who will be offered a premium subscription for free. Second, he’s hoping the employees will turn into ambassadors, by speaking highly of the service to friends and customers.
“One of the things we realize is that nothing is more powerful to us than word of mouth,” he said. “We believe the partner (Starbucks employee) plays that role in the community. When they get excited, they get the customer base excited about it. That’s why, in essence, we are doing this. The partners are a powerful benefit and their most powerful asset.”
Lastly, Spotify will also have access to the 10 million My Starbucks Rewards loyalty members, who will now be able to spend points — not cash — on the subscription service.
