When it comes to mobile apps, there are only a handful which have the kind of reach of music discovery software Shazam – more than 100 million users, availability in 200 countries with support for 30 languages, across multiple device platforms. While the company has been in existence for 10 years, in recent months it has seen the pace of sign-ups increasing significantly: “around the time of our 10th anniversary in August 2010, we reached an incredible milestone – more than one million new users a week,” says Andrew Fisher, the company’s CEO.

“Our success is due to a number of things: our algorithm and extensive music database of more than eight million tracks, which allows us to help consumers discover and share more music than ever before.  We’ve got great partnerships with handset manufacturers, like Apple and Nokia, and we work with carriers such as AT&T, T-Mobile and Vodafone around the world to help them enhance their music and mobile discovery strategies. Plus, we are always innovating and looking for ways to offer Shazamers more.”

The company is seeing increased competition from rivals, with companies such as SoundHound gaining traction in the market. “As a category develops, there will inevitably be new entrants and this validates the business proposition.  Our offering is far broader than anyone else’s and this is what is driving our growth with more than one million new users per week. You’re going to continue to see a lot of innovation from Shazam with further expansion of our content discovery expertise into new areas. As you can see, we’re focussing on what we do best and it’s working very well.”

The company has also benefited from the growth of mobile apps in general. “From the consumers’ point of view, we believe they’re becoming more and more confident about downloading apps onto their phones and with in-app payment becoming more prevalent, they are increasingly comfortable about paying for premium apps, such as Shazam Encore, from their devices,” Fisher says. 

Driving mass market adoption
In order to achieve its impressive reach, Shazam has worked across a number of device platforms and app stores. Its strategy involves availability across the major application stores, and pre-loading on “as many handsets as possible.”

“We’ve invested in both process and resources to address the different platforms and operating systems and although it adds more work overall, we don’t find it a significant barrier,” Fisher says. “There are some core components and WebKit-based features which are leveraged across platforms, but most of the UI must be custom built.  There’s also additional porting work for each platform to take into account different devices; however, moving from a phone-sized platform (e.g. iPhone) to a tablet-sized platform (eg iPad) does require a complete UI redesign if you want to deliver the best user experience.”

“Shazam is on the Apple App Store, Ovi Store by Nokia, Android Market, Windows Marketplace, Orange App Store, BlackBerry App World and we recently announced we’re on GetJar. We also have pro-active PR and social network campaigns to drive discovery and reach influencers across the globe,” he continues.

Evolving business models
In November 2009, Shazam introduced a Freemium model, which Fisher says is “working very well.” The free app enables users to tag up to five tracks per month, while also supporting features including 30-second previews, lyrics, tag charts and the ability to share with friends on Facebook and Twitter. This is complemented by a premium version called Shazam Encore, which offers unlimited tagging and additional features. While Shazam has not broken-out numbers for Encore, “we can say that the uptake of Encore is going very well across all platforms. Encore, on the iPhone, has regularly been listed in the top grossing apps on the App Store.”

To support Shazam Encore, the company has introduced a number of different pricing options, including an annual subscription offer on the Apple App Store, as well as a one-time payment option. According to Fisher, “ease of payment is also very important. On the iPhone, upgrading from free to paid is all done within the app, so it’s very seamless for the user to upgrade without a new download.”

Shazam also recently began exploring its advertising options. During December 2010 it announced partnerships to enable partners to advertise content on the “listening screen” displayed when the Shazam app is identifying a song. And it has also announced Shazam Audio Recognition Advertising, where customers are encouraged to tag television programmes or commercials in order to access special content, buy products, and receive promotions.

“Shazam can take advantage of the trend for ‘media stacking.’  Research shows that two-thirds of viewers, especially 18-24 year olds, are watching television in conjunction with using other types of media, using their mobile to SMS, Facebook or IM. So ’Shazaming a Show’ is the next natural step. There is so much creativity around the product and the business models at Shazam – it’s an exciting time,” Fisher notes.

Building on this, in January 2011 Shazam partnered with television channel Syfy to launch “the first, series-long ‘TV-tagging’ initiative” to support the show Being Human, with customers tagging the show receiving access to a range of exclusive content.

 

Steve Costello