There are no hard facts on how much Spinlet is making, but if their user figures are anything to go by, it’s not a lot.
As at 2013, the last time Spinlet shared figures, the service had 500, 000 users with no mention of how many of those are paid subscribers. The 500,000 (which would have grown larger since that time) may appear a decent figure for a music service in Nigeria, but not when it is compared with Spinlet’s marketing spend. Spinlet’s latest figures reveal that the service has 1.8 million signups with about a quarter of that number active every month.
I don’t know how much revenue Spinlet is bringing in, but with Apple Music and Deezer in the mix, in Nigeria, that number is likely dwindling. But bills need to be paid and investors need their ROI.
Spinlet easily has the largest catalogue of African musicians (it’s spent its early years tying up licensing deals with local acts) and this is good, but international streaming services – Deezer and Apple Music – are catching up fast. In 2013, Deezer released Ice Prince’s Fire of Zamani album the same day as Spinlet. Apple Music (which has stolen loads of users away from Deezer since its three-month free trial began in June) boasts a robust database of Nigerian legacy songs from the 80s. Same goes for Spotify.
What’s more? Nigerians, like their others across the world, will sooner go to a free music site than pay for a digital album. So transaction fees from album sales for Spinlet is also clipped.
This, combined with the fact that the taste of Nigerians in music is favouring international acts, Spinlet may be in a hard place. As it is, Spinlet needs to get itself up the pecking order of music streaming services, get more users and make money.
I’m willing to bet Spinlet management has thought about these monetization options in their boardrooms, but here they are, as a reminder:
Become a discovery platform with basic free streaming
With its catalogue of up and coming local artistes, Spinlet can pivot to a discovery platform for African acts, with free streaming. Monetization will be done via ads. What this will be is a hybrid service of music discovery websites like TooXclusive and NotJustOk, and an online radio service like Jango.
Also, try making it hyperlocal (using the word loosely here), focus exclusively on African tunes and layer a social component into the product where artistes can have real profiles managed by them. Let’s call it SpinHub. They can share bits about their songs on there. This will draw in users and keep them, and for artistes, well, sometimes they can use real-time feedback from their fans.
Also, have artistes release exclusives on the platform. The goal is to become an authoritative source and because your platform also promises a way to monetize for small-time acts, artistes can begin to choose Spinlet over some existing discovery websites.
Set up trial period and basic membership
Trial periods like on Apple Music and most other streaming services, draw users in. I am so not a fan of song snippets as Spinlet currently has on the platform and I’m pretty sure I’m not alone on this. After trial periods, Spinlet can downgrade users to basic accounts with ad-supported streaming, but of course, with the option to upgrade anytime they so choose.
This will place Spinlet firmly as a competition against Apple Music and others, but maybe its catalogue of local acts will give it an edge. One thing this will do is bring more users to the platform: if the content is sticky, the users will stay.
Evernote is a product that has turned profit in this manner. According to its CEO, Phil Libin, “The easiest way to get a million people to pay for nonscarcity product may be to make 100 million people fall in love with it.”
Confronting users with a paywall right on the landing-page, like Spinlet currently does, is not a friendly welcome. Basic ad-supported streaming will keep users around long enough, and maybe on the long run, they’ll decide to subscribe.
If they choose not to, however, Spinlet continues to make money via ads.
These two alternatives will not only bring a steady flow of revenue, but will drive user growth; a figure that Spinlet can always think up creative ways to monetize on the long term, including via ads and premium subscription.
[Update 12:10, October 9, 2015] Some of the recommendations in this article – including basic ad-supported streaming – have already been implemented by Spinlet before the article went up. According to a Spinlet spokesperson, some of these recommendation have been up for as long as 2 months. I was led to believe otherwise because as at my last check yesterday – aside the update in the user interface – these updates were not live. Current hypothesis is that Spinlet is transitioning its website making some of these updates unstable. I have reached out to Spinlet for comments regarding this and will update accordingly.”
[Update 16:23, October 9, 2015] Spinlet’s Business Development exec, Rotimi Fawole confirmed that ongoing development work on the website may have caused periodic downtime on the platform. The website has been recording impressive stats since they last shared figures, Rotimi told me. Spinlet now has over 1.8million registered users, with an average of 1,500 new user registrations daily, he says, with about a quarter of that active every month.