Spotify is the most popular audio streaming service in the world. It’s an impressive title and one that comes with an interesting story. We take a look at the history of this innovative organisation to understand how ‘Spotify’ became a household name and the role this title has played in the company’s success.
The Story of Spotify
There has long been a demand for digital audio streaming, however, it hasn’t always been legal. In the late 1990s and early 2000s, programs like Napster, Kazaa and Limewire were extremely popular, allowing users to download songs and audio files of their choice directly to their computer. This was a real novelty as people now had access to a wide range of free music, rather than having to purchase tapes and CDs from their local entertainment store. The problem was that this form of music download was illegal. Digital streaming broke piracy laws and meant artists were not getting appropriately compensated for their work, until Spotify was born.
Daniel Ek identified this problem and worked to address the gap in the market. There was a real demand for digital music streaming, yet the only way to deal with the piracy issue was to create a legal solution that worked better and satisfied users. In 2002, as many of the illegal streaming programs were ceasing to exist, Ek came up with the idea of a music streaming platform that gave users access to a catalogue of music while also paying artists.
In the beginning, many people were doubtful of the concept. The music industry was struggling and Ek had to work hard to convince record companies to license their songs for use on the platform. Despite some bad press and continued scepticism, Spotify hit 1 million paying subscribers in September 2011. They signed a deal with Facebook and reached 2.5 million paying users by November 2011. The rest is history.
Competitors like Apple Music have since entered the market and threatened the success of Spotify, yet the company has maintained its position. It currently has a user base of 345 million people, with 155 million of them paid subscribers.
How Spotify got its name
Sometimes a name is just a name, and yet it works. With Spotify, there is no magical story or special meaning behind the term. In fact, the name was born from Ek mishearing a suggestion from Martin Lorenzton, the co-founder of Tradedoubler. The pair were calling out ideas when Ek thought he heard Spotify, seemingly a combination of ‘spot’ and ‘identify’. In reality, this wasn’t what Lorenzton had said, but Ek liked the name and decided to use it.
Generic Brand Names and How to Make Them Work
There’s no telling what Spotify is or does from the name alone. If you’re not familiar with the brand already, you’d have no idea that it is associated with music or streaming or anything in the field. Yet, it works. Spotify has been hugely successful despite having a seemingly generic name and there are a few reasons why.
Firstly, it’s different from anything else. Spotify, being a made-up term, isn’t easily confused with other words or brands, and therefore it stands out from the crowd.
Secondly, it’s easy to remember. The fact that it is unique means people are more likely to remember it, but it also isn’t too long or complex.
Finally, it passes the crowded bar test. Even in a noisy room full of people, the term Spotify is easy to distinguish and understand. It’s not difficult to pronounce or spell, which means people are more likely to be able to find it when they search online.
Finding the perfect brand name is no easy feat, but the story of Spotify demonstrates just how important the task is for ongoing success. Squadhelp can help you find the right name for your company, so get in touch today.