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Why Streaming on Spotify Actually Declined During the Pandemic

Why Streaming on Spotify Actually Declined During the Pandemic
Written by publisher team

A group of international researchers observed an overall drop in music streaming on Spotify amid the COVID-19 pandemic compared to streaming figures before the global health crisis, as a recent study in the marketing research journal Marketing Science concluded.

The pandemic and resultant lockdowns significantly reduced the consumption of audio music streaming in many countries as people turned to video platforms, it found. On average, audio music consumption by 12.5 percent after the World Health Organization (WHO) declared a pandemic in March 2020.

Jaeung Sim, one of the contributing researchers and doctoral candidate at Korea’s Advanced Institute of Science and Technology (KAIST), illustrated, “On average, audio music consumption decreased by more pandemic than 12 percent after the WHO declaration.”

He continued, “As a result, during the pandemic, Spotify lost $838 million of revenue in the first three quarters of 2020. Our results show that human mobility plays a much larger role in the audio consumption of music than previously thought.”

The findings highlight a misconception that listeners would have actually streamed more music as they found themselves in various states of lockdown. But the numbers show otherwise.

“Despite the common expectation that the pandemic would universally benefit online media platforms, we found that it adversely impacted music streaming services,” fellow researcher Rahul Telang, an information systems professor at Carnegie Mellon University, remarked.

He added, “Our findings imply that the substantially changing media consumption environment can put streaming music in a fiercer competition against other media forms that offer more dynamic and vivid experiences to consumers.”

The study, titled Virus Shook the Streaming Star: Estimating the COVID-19 Impact on Music Consumption, came to its conclusion by analyzing Spotify streaming data. It looked at the weekly top 200 songs for two years in 60 countries between June 2018 and May 2020, along with varying lockdown policies and detailed daily mobility information from Google. Empirical evidence showed that the COVID-19 outbreak significantly reduced music streaming consumption in many countries. It also found that countries with higher mobility decreases saw more significant downturns in streaming during the pandemic.

See the complete study here.

Marketing Science is a peer-reviewed scholarly journal focused on research using quantitative approaches to study all aspects of the interface between consumers and firms. It’s published by INFORMS, a leading data sciences association.

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