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Analysing the strategic issues and recommendation for Spotify to remain competitive


Task: Identify three strategic issues that the CEO of Spotify, Daniel Ek, must address. Provide your rationales for why these three issues should be at the top of Spotify's priority list.What does a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis reveal about Spotify in 2020 for the future reflections of the CEO, Daniel Ek To what extent do you believe that the strategy (ies) adopted by Spotify in 2020 will enable the company to remain competitive in the global streaming market over the next 10 years Develop three justified recommendations you would propose to the CEO of Spotify to address the three top priority issues previously identified.


Three strategic issues:

1. Expansion into new markets: Expansion into new markets is one of the strategic issues that Daniel Ek, the CEO of Spotify, must address in order to remain competitive in 2020 (Hodgson, 2021). It allows Spotify to tap into untapped potential and increase its customer base. As the music streaming industry is becoming increasingly competitive, Spotify needs to have a presence in more markets to maintain its current market share. It will also create new revenue streams for the company and open up opportunities for partnerships with local companies. It requires careful planning and strategy, as Spotify must consider a variety of factors, such as economic, political, and cultural conditions. Spotify must develop a marketing strategy that is tailored to each market, as consumer tastes and preferences vary significantly between different countries and regions. Daniel Ek must address the strategic issues in order to remain competitive in 2020. Expansion into new markets is essential for increasing Spotify's customer base, as well as for establishing a presence in different countries.

2. Establishing the right pace of change: Establishing the right pace of change is another strategic issue that Daniel Ek must address. The digital music industry is highly dynamic, with new technology and trends emerging on a regular basis. Spotify must stay ahead of the curve in order to remain competitive, as other companies are rapidly innovating and developing new products to meet consumer needs. Daniel Ek must develop a strategy to keep Spotify at the forefront of digital music innovation, as well as identify new opportunities for growth and development. Ek must pay attention to the market's response to Spotify's new initiatives and adjust the company's strategy accordingly. Establishing the right pace of change is important for staying ahead of the curve and innovating new products.

3. Enhancing technology: Enhancing technology is an essential strategic issue for Spotify in 2020. This is because it allows the company to further develop its streaming service and keep up with the competition (Handoyo, et al., 2023). By enhancing its technology, Spotify can level the playing field and maintain its competitive edge. And enhanced technology can reduce costs associated with running the streaming service and make it easier for customers to access and use the service. Spotify’s competitors such as Apple Music, Google Play Music, and Amazon Music are all actively investing in new technology and features such as automated music curation, enhanced search, and personalized recommendations.

SWOT analysis of Spotify

A SWOT analysis of Spotify in 2020 reveals both opportunities and threats for the future reflections of CEO Daniel Ek.

Strengths: Spotify has a strong brand recognition and a loyal customer base. It has a vast library of songs, podcasts, and videos (Yin & Fu, 2021). It has an extensive network of partner labels, publishers, and other content providers. It has an intuitive and user-friendly interface and features such as playlists, radio, and discovery tools. It also has a highly sophisticated personalization engine that learns a user’s taste in music and creates custom playlists for them. It has also been successful in launching its own music streaming platform, Spotify Stations, and is currently the market leader in music streaming (Prey, 2020). Thus, there are many strengths of the Spotify company as it has various international markets.

Weaknesses: Spotify’s main weakness is its dependence on record labels for content (Sletten, 2021). The company’s deals with labels are often restrictive and exclusive, limiting its ability to offer new music. It also has weak relationships with some of the major labels, which could make it difficult to secure new content or renew existing contracts. It also has a limited presence in some countries, making it difficult to expand its customer base. As it has very competitive company available market.

Opportunities: Spotify has the opportunity to expand into new markets and increase its user base (Bello & Garcia, 2021). It also has the opportunity to diversify its content offerings. For example, it could partner with other streaming services to offer a broader range of content. It could also expand its partnerships with labels and other content providers to improve its library. Spotify company has various opportunities to expand its business in the world and become the most famous company in the world.

Threats: The main threat facing Spotify is competition from other streaming services. Apple Music, Amazon Music, and YouTube Music are all major competitors in the market. The music streaming industry is becoming increasingly crowded, with new entrants such as Tidal and Deezer entering the market (Hesmondhalgh, 2021). There is also the threat of piracy, which is a significant issue for all music streaming services.

Strategies adopted by Spotify

The global streaming market is an increasingly competitive field, with many large players such as Amazon, Apple and Google vying for market share (Nicoli&Iosifidis, 2023). To remain competitive, companies must develop and implement strategies that will allow them to stand out from the competition. Spotify is no exception. The company has adopted several strategies in 2020 that will likely enable it to remain competitive in the global streaming market over the next 10 years.

1. Expansion: Spotify has undertaken an expansion strategy, expanded its user base and entered into new markets (Forte, 2022). This includes launching its services in India, launching its podcasting platform, and creating exclusive content deals with popular artists. By expanding its user base, Spotify will be better positioned to capitalize on streaming revenue opportunities, as well as create more opportunities for revenue diversification.

2. Innovation: Spotify has invested heavily in innovation. This includes the development of new features such as its personalized radio service, as well as its acquisition of several music-related startups (DOGAN & GOC, 2019). These innovations will help Spotify stand out from the competition, as well as provide the company with a competitive advantage. Spotify has also implemented several new monetization strategies, such as its ad-supported tier and podcast subscription service. Innovation will help Spotify remain competitive in the long-term, as new technologies and products are developed and released.

3. Cost cutting: Spotify has implemented a cost-cutting strategy. This includes cutting costs such as marketing and advertising, as well as consolidating its operations (DeWaard, 2020). This cost-cutting strategy will help Spotify remain competitive in the long term, as it will help the company reduce costs and remain profitable. Spotify has also reduced prices in certain markets, such as India, to better compete with other streaming services. This cost-cutting strategy will help Spotify remain competitive in the global streaming market, as it will allow the company to reduce prices and remain price-competitive with its rivals.

By expanding its user base, investing in innovation, and cutting costs, Spotify will be better positioned to remain competitive and capitalize on the growth of the streaming market. As new technologies and products are released and adopted, Spotify’s strategies will likely remain relevant and effective. Therefore, it is likely that the strategies adopted by Spotify in 2020 will enable the company to remain competitive in the global streaming market over the next 10 years.


The recommendations focus on the company’s need to improve user engagement, increase its presence in emerging markets, and address its rising costs.

1. Enhance User Engagement: The recommendation that the CEO of Spotify is to enhance user engagement. This can be done by increasing the use of personalized recommendations, which can be generated by utilizing algorithms to analyze user data. This will allow Spotify to offer its users more relevant and customized music recommendations, which will increase user engagement and satisfaction. Spotify should focus on creating a more social experience for its users by introducing features such as user profiles and the ability to follow other users (Lüders, 2021). This will allow users to connect with one another and share their music tastes and experiences, which is likely to further increase user engagement and satisfaction.

2. Increase Presence in Emerging Markets: The second recommendation is to increase Spotify’s presence in emerging markets. Spotify needs to expand its presence in countries such as India, Brazil, and Mexico, which are some of the largest music streaming markets in the world (Simon, 2019). This can be achieved by localizing the service to better serve the needs of the local markets. This could include offering language-specific playlists, as well as localizing the user interface and payment options. Spotify should focus on building relationships with local labels, artists, and music streaming services in order to increase its presence in these markets.

3. Address Rising Costs: The third recommendation is to address the rising costs associated with music streaming (Nurgazina, et al., 2021). In order to do this, Spotify should focus on improving its royalty payment system. This could be done by introducing a system that more accurately tracks and pays royalties to artists, labels, and publishers. Spotify should focus on negotiating better deals with the music labels, which could help to reduce the costs associated with streaming music. Spotify should focus on increasing its revenues by introducing subscription tiers that offer additional features, such as ad-free listening, higher-quality audio, or exclusive content.

These three recommendations are designed to address the top priority issues facing Spotify in 2020. Enhancing user engagement, increasing presence in emerging markets, and addressing rising costs are all essential steps that the company must take in order to ensure its continued success. By implementing these recommendations, Spotify will be able to remain competitive in the industry and ensure its long-term success.


Bello, P., & Garcia, D. (2021). Cultural Divergence in popular music: the increasing diversity of music consumption on Spotify across countries. Humanities and Social Sciences Communications, 8(1), 1-8.

DeWaard, A. (2020). Financialized Hollywood: Institutional investment, venture capital, and private equity in the film and television industry. JCMS: Journal of Cinema and Media Studies, 59(4), 54-84.

DOGAN, O., & GOC, Y. S. (2019). Big data exploitation: an analysis on how different companies leverage data.

Forte, D. D. S. (2022). Listening to the future: spotify´ s dominance through podcasts and emerging markets (Doctoral dissertation).

Handoyo, S., Mulyani, S., Ghani, E. K., &Soedarsono, S. (2023). Firm Characteristics, Business Environment, Strategic Orientation, and Performance. Administrative Sciences, 13(3), 74.

Hesmondhalgh, D. (2021). Is music streaming bad for musicians? Problems of evidence and argument. New Media & Society, 23(12), 3593-3615.

Hodgson, T. (2021). Spotify and the democratisation of music. Popular Music, 40(1), 1-17.

Lüders, M. (2021). Pushing music: People’s continued will to archive versus Spotify’s will to make them explore. European Journal of Cultural Studies, 24(4), 952-969.

Nicoli, N., &Iosifidis, P. (2023). EU digital economy competition policy: From ex-post to ex-ante. The case of Alphabet, Amazon, Apple, and Meta. Global Media and China, 20594364231152673.

Nurgazina, J., Pakdeetrakulwong, U., Moser, T., & Reiner, G. (2021). Distributed ledger technology applications in food supply chains: A review of challenges and future research directions. Sustainability, 13(8), 4206.

Prey, R. (2020). Locating power in platformization: Music streaming playlists and curatorial power. Social Media+ Society, 6(2), 2056305120933291.

Simon, J. P. (2019). New players in the music industry: lifeboats or killer whales? The role of streaming platforms. Digital Policy, Regulation and Governance, 21(6), 525-549.

Sletten, R. T. (2021). Spotify: Strategic Plan and Analysis.

Yin, S., & Fu, L. (2021, December). The Effectiveness of Brand Culture on Customer Engagement. In 2021 3rd International Conference on Economic Management and Cultural Industry (ICEMCI 2021) (pp. 2653-2659). Atlantis Press.


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