The interview with Shazam about marketing, business model and new products
At MBLT 2017 I interviewed Josh Partridge, Shazam’s director in charge of spreading the company’s commercial activities to EMEA, LATAM and Canada.
During the interview, we talked about the integration with Snapchat and DanAds, TV show Beat Shazam, Shazam Codes, Visual Shazam and much more.
You said Shazam for Brands is available in 50–60 countries, but selling directly to brands takes local salesforce, so you need local offices…
We do it in a couple of different ways. We have offices in the USA, UK and Sydney and have recently launched one in Berlin, Germany. For other countries, we partnered with companies on the ground. They are the ones who go talking to brands media agencies to find out how brands want to leverage the Shazam audience, Shazam technology to deliver advertising solutions.
What is the main feature of this product that the brands use?
We have the traditional display advertising in our app and Shazam Connect advertising solution, which is allowing to use our audio recognition for TV commercials or TV content and thus deliver a second screen experience. We’ve also recently launched Visual Shazam, which means you can actually visually Shazam something.
An example: in Russia, we partnered with Nescafe that sponsored a big dance contests there. We made the actual performances shazamable, i.e. viewers could shazam a performance and get some extra content about it. Through 10 weeks, we delivered over half a million shazams sponsored by Nescafe.
Is it hard to sell such integrations to brands? As far as I understand, it is a kind of a long-term special project, right?
We have varying products, some special products that take a bit longer in the sales cycle and some immediate products. Very sophisticated stuff and cool off-the-shelf solutions. This means we can start quickly and then move one to more specialized products as our presence in the market increases.
It’s easy for us to explain to advertisers what Shazam is and how they can use that technology to really drive a connection between the consumer and the product. Shazam is connecting the music you hear to your mobile device. We’re giving the brand the opportunity to use that device to connect to the world around them whether it’s their TV ad, their print ad, their packaging. Shazam, through audio and visual recognition, delivers that connection.
Do you plan to open some more sales offices?
Absolutely! The German office launched this month, and the team joins over in April-May-June, so in Germany, we’re fully firing by the middle of this year. We have a couple of other countries that will probably come later. What we always want is profitability, we’re a small company, so we have to grow responsibly. But, certainly, that’s the vision.
What countries are the most important for you in terms of selling ad solutions to brands?
With users in 190 countries, we, as a small company, can hardly go after all of them. So we are active in probably around forty-five of those markets. We are talking about Americas, big European markets — UK, France, Germany, Italy, Spain. They are sort of the core of our business. Countries like Russia, Latin America, Canada are also very important, though. An interesting thing about Russia: when I joined three years ago, Russia probably wasn’t in the top 20 markets in terms of audience, but in these past 18 months it has gone into the top five.
What about the emerging markets, like Africa?
We actually have a pretty good presence in South Africa. One of the challenges of Africa is smartphone penetration, and South Africa is certainly leading there, along with Nigeria. But obviously, Middle East, North Africa are of interest to us and we are quite active there.
You’ve announced recently that you have partnered with DanAds, the white label self-service advertising solution for publishers. Does it mean that we soon can expect some self-service interface for advertising in Shazam?
The partnership is focused on our label relationship. Labels love to promote upcoming singles, albums, and with DanAds platform we enable them to traffic their own ads with specific targeting they want to focus on. So it’s more of a label relationship at the moment.
And what about traditional advertisers like the app developers?
We love to work with agencies, build a relationship through traditional orders, and we also work with a lot of the trading desks and ad exchanges. So, people can buy Shazam inventory however they want to, either programmatically or directly through our sales team.
Do you plan to launch your self-service platform for app developers?
Not now. At this stage, the focus has been on the labels. Brands already have a very good access to our ads either through ad exchanges or through ourselves. The self-service is already available through programmatic buying. But some very specific Shazam formats you can buy only directly through us.
Tell me, why there’s still no competitor even close to Shazam? Is it the unique technology, or is it just the Shazam was the first one in this game?
I think there are two key things. Absolutely, it’s the technology, our recognition is faster, more reliable than anyone else’s. That, plus the branding. Fortunately, Shazam is very much seen as a verb now — to Shazam something — and people know what that means. Also, when you Shazam something you get a result, and the user sees it as a magical thing. All of those ingredients combine to create a very unique app, which is why you see us being the leader in this space.
Why I cannot shazam if I just sing the tune of the song?
Shazam is about certainty. We put a lot of effort into our technology and database so when users shazam we know for sure what song it is. If you sing something, you’re not able to make that accurate prediction, and we don’t want to reply like “well, it could be this”. People come back to Shazam because it gives information.
There’s a TV program launching in the USA called Beat Shazam, which is all around seeing whether consumers can deliver the result quicker than Shazam can. It’s great for the brand, of course, but it also proves that the recognition is incredibly accurate.
You’ve made an integration with Snapchat last December. Can you share some first results?
It’s relatively new, we launched with Snapchat a few months ago. The interesting thing about Snapchat is that when we launched the integration, it wasn’t actively promoted. But Snapchat created an amazing habit: by holding down on the screen, consumers get something, so for Shazam that really is almost an organic behavior. We’ve seen millions of Shazams, but it’s just a start and we hope we can do more with Snapchat in the future.
Do you plan to integrate into more apps?
Yes. The focus has been on Samsung Smart TV, which we launched at South by Southwest. Snapchat is also a very big one, it’s been the focus issue too. At the moment, no other plans, but those two are very big and very exciting ones.
What about other platforms? You have the app for Apple watch, for iMessage. Where else are you going to go further? Why not Facebook Messenger?
If our users want to Shazam something and they want to do it through a new technology, we always want to make sure we’re there. We are always considering something. iMessage and Apple Watch were some of the very first apps we made a version for. As such things come up, our product team takes a really good look and says does it make sense to do this, is there a scalable opportunity, do our users want to be able to do it.
If we can answer those questions and the product team thinks it’s a good idea, we do it. At the moment, there’s nothing I can talk about, but we just did two rather large ones that we’re seeing huge results from so I’m sure there will be some more in the future.
Are you going to VR? Will it be some next platform where Shazam works?
Our focus may be more augmented reality versus virtual reality. We just launched the very first two campaigns, one in the USA, one in Australia, for brands, using visual Shazam codes to give the consumers an augmented reality experience. I know we’ll have some in Russia in the next couple of months. So our focus has been on augmented reality versus virtual reality.
Why do you think QR codes have failed and have not become something massively used?
I think they’re ahead of their time. They launched about five-six years ago when smartphone penetration was very low. Also, back in 2011–2012 the app world was incredibly small, most people were still going through a browser on a mobile. The tech wasn’t ready, users hadn’t made the life switch to their mobiles like they do today. So I think QR codes were ahead of their time.
We’ve recently launched Shazam codes and we believe it’s a success. There are two big reasons for that. One, people use smartphones as devices that connect everything, the consumer behavior has been established. Two, no one had the QR code reader on their phone, no one is going to download an app to engage with the brand.
In case of Shazam codes, we already have a huge install base that knows what the Shazam logo is and how to engage with it. So having that habit created, smartphones becoming such an integral part of our lives, coupled with having a large installed base like Shazam has, means that there is a scalable solution that the brands can take advantage of.
Is it free to create Shazamable content?
Shazam actually reads QR codes, but for Shazam codes, it’s been launched as an ad product, so brands pay to do it. It’s not to say that won’t change in the future, but at this stage, the focus has been more on advertising.
Have many people have already tried that?
Absolutely! Before Shazam Codes, we launched Visual Shazam. We’ve worked with some of the biggest brands in the world to make their products Shazamable. In the USA, we talk about 600 mln coke bottles. Then, we rolled out Visual Shazam, we rolled out Shazam Codes, we rolled out Shazam AR. We’ve really been investing in our visual capability.
Apart from educating our users about that function, we are also investing in brands so they know about it and take advantage of it. We’re seeing some huge campaigns already go live and we’ve got some huge ones in the pipeline. Some big ones are coming up in Russia soon.
Can you remember the worst day for the company since you have joined it?
We don’t have bad days. When you see hyper growth when you see investment and your team is getting bigger… When I joined Shazam, I had a team of one and now my team is much bigger and we expand into more markets. The very fortunate thing about Shazam is that we all love what we do. You can have challenging days, but certainly, don’t have bad days. I’ve had bad days before, not at Shazam, I have been at Yahoo for six years before…
There were bad days at Yahoo?
No, I worked in finance long before that and I have bad memories of some days working in finance. But I’ve been fortunate to work in Yahoo and Shazam. I love what I do, and I’ve had jobs where I didn’t love what I do, so I know the difference. So I’m very fortunate.
Can you remember some wrong decision made by Shazam, some failed project?
In these spaces, you have to make decisions quickly. It’s a mentality: just because something doesn’t work it doesn’t mean it’s a failure. You have to try, you have to iterate, you have to improve and that’s the beauty of this space. You try something, it doesn’t work, you pivot and you put everything down to a lesson.
I don’t think we’ve had any failures. Some things were done better than others, but everything is about learning, everything is about improving. Apps are continually iterating, continually improving. That’s the space we live in. Compared to very traditional industries, where when they launch something after some 2 years of planning, in the tech space, the mentality is very different.
That’s all, I think. It was good talking to you.
Thank you, it was same to me.
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