Partnership between Spotify and Starbucks to enable baristas to choose the music being played in the restaurant
Starbucks decided to break with a 20 year old tradition, and stopped selling CDs in its cafĂ©s. The international chain of cafĂ©s has confirmed that it is looking squarely to the future, announcing instead a partnership with Spotify, the on-line music streaming platform. After the high-tech coffee machine, Clover, and the application for paying with your smartphone, Starbucks is taking another step in the world of innovation and digital technology.
So what does this partnership entail exactly? Spotify is to became the default source of music for its 7,000 Starbucks coffee houses throughout the US. Each of the 150,000 Starbucks employees in the United States will receive a Spotify Premium subscription (which normally costs $10/month), and they will be able to use it to choose the music being heard in the shop. « We are going to turn baristas into DJs, » explains Daniel Ek, CEO of Spotify. Consumers will also play a role â€“ they will be able to suggest the music they want to hear to the baristas.
The involvement of Starbucks in the world of music is not new. According to Jorge Espinel, head of business development at Spotify: « Starbucks is a point of reference in terms of musical choice because for a long time it has contributed to the recognition by the general public of many artists. » Spotify is therefore giving Starbucks a simple and easy-to-use tool to share this enthusiasm for music that is part of the identity of this brand. The aim is that when the customer leaves the cafĂ©, he leaves with an experience he can share with others. « Our long-term plan is to create an external ecosystem with brands sharing the same tastes as us, » explains the Starbucks boss, Howard Schultz.
Jorge Espinel considers the partnership to be a natural one: Starbucks needed to improve its technology, and Spotify needed a large partner with musical experience. The partnership could be even more crucial for Spotify, which has recently faced a wave of attacks, notably from some famous artists such as Jay Z and Taylor Swift. Spotify really needs more paying users, and Starbucks has already proven that it can sell much more than coffee (CDs, mobile apps etc.). As part of this partnership, Starbucks will promote Spotify Premium, and it will even be possible to get free coffees by taking out a Spotify Premium subscription. It’s the first time that Starbucks has opened up its loyalty scheme to a third party company. If it turns out to be profitable, the model may be rolled out to other companies.
The strategy of Spotify is obvious: to be everywhere. And that is exactly what Starbucks offers. The brand has also formed partnerships with Uber, BMW and the Bonnaroo music festival to spread its presence. For the time being, the partnership is only with Starbucks in the US, but it should quickly be extended to Canada and the United Kingdom.