Tuesday, November 03, 2009

Spotify Gets Crafty

Spotify has gotten wise to a business model that was seeing it burning through its cash and has now restricted access to its service in a very clever way. Existing users are not affected, but new users must be invited by a paying member or must become a paying member.

Of course, this goes against all the rules of 'freemium', but it's an interesting twist on an old marketing strategy - 'customer get customer'.

The same strategy has long been used by Sky to get new subscribers, offering a cash inducement to anyone signing up a neighbour, relative, colleague or friend.

Perhaps the next strategy is to offer a month's free subscription for every paying customer signed up. It's Tupperware for the online generation.