Spotify has launched a new in-house brand partnerships agency called AUX. Led by Jean-François Pathy, it will advise brands on how best to use music in their marketing campaigns and team them up with willing artists. Or at least that’s the idea.
“Spotify is always looking for ways to leverage our music ecosystem to deepen the connections between artists, brands, and fans”, says Jeremy Erlich, Head Of Music Content at Spotify. “AUX is a natural step for us to help brands strengthen their music strategy and better connect with new audiences through our expert insights and observations from our music team, tailored to meet brands’ needs”.
As Spotify continues in its endeavour to become a profitable operation, boosting its ad and brand income is a key priority. It currently makes considerably more money from selling subscriptions despite having more users on its ad-funded free-tier.
By facilitating more extensive brand partnerships built around its platform, Spotify presumably hopes to access bigger budgets from advertisers. Which sounds like fun.
Being the middleman for brand partnerships in music can be complex though, as there are so many stakeholders involved, with multiple rightsholders controlling the music itself, and the artist and their management team playing the most important role. And Spotify’s music industry deals are generally with record labels and music publishers, not artists.
Still, at launch, AUX has bagged a biggie. It has teamed Coca-Cola up with Peggy Gou for the drink brand’s new Coke Studio campaign. As part of that, emerging artists will be offered recording time in a studio at Spotify’s LA offices.
Involving emerging talent in these projects is probably a wise move, given earlier career artists are generally easier and cheaper to engage. And maybe getting brands to champion new acts will help people forget how Spotify is freezing millions of grassroots musicians out of the royalty pool.
