Businesses are finding it difficult to stay afloat during the pandemic. Tech businesses might have found new users in people who have been locked down. However, the competition is fiercer than ever. Spotify is now offering free three months of subscription for new users provided they sign-up by June 30th. The offer is available for all the plans including individual, family, and student.
Needless to say, Spotify is working hard to keep up the subscription revenue during the COVID-19 pandemic. Perhaps this will help the music streaming giant to subsidize the loss of revenue from ads. Spotify earns a major chunk of its revenue by serving ads for free users. Due to the pandemic, the ad-revenue seems to have taken a plunge.
In all likelihood, Premium Users have also unsubscribed Spotify premium in order to save money. Spotify plans to bring them back on board. The company has decided to offer three months of Spotify Premium at the price of just $9.99. In other words, existing Premium users can pay for one month of Spotify Premium and get the next two months for free. However, the offer is only valid for users who have unsubscribed before April 14th. It is worth noting that both the offers end on June 30th. Once three months is over, the user will be charged the regular rates.
Spotify has also lowered its revenue guidance and claims that people have canceled subscription due to the pandemic. Apparently, one in six customers who have canceled the Spotify subscription cites COVID-19 as the reason. On the brighter side, they are planning to subscribe back once the economic situation improves. Spotify might be able to lure back the lost users and new users with the offer.