Head of Digital Sales & Business Development (Sweden) and Partner Development & Sales, Global Digital Business
Sony Music Entertainment
Jacob Herbst works for Sony Music Entertainment in Stockholm. His dual brief involves running the company’s digital business in Sweden and managing Sony’s global relationship with Spotify, as well as helping shape its international streaming strategy.
He is well placed to manage the company’s relationship with Spotify.
“I was a big user of Spotify even before it publicly launched. One of my high school friends was one of the first developers at Spotify, so I had early sight of it. When I joined Sony four years ago, it was already obvious that streaming would be our future locally and so managing our relationship with Spotify and developing a streaming strategy was a huge part of my job from the start.”
Working in Stockholm enables Herbst to have a close working relationship with the streaming service.
“Spotify has great teams working in London and New York and we work very closely with them, but it’s great that in Stockholm we can walk over and discuss any issues that arise face to face with the guys who built it and wrote the code for it.”
Spotify soon became the leading digital partner for Sony Music in Sweden and this meant that the record company and the service were incentivised to work together to develop it further.
“We looked together at how we could use Spotify to reach even more consumers with our repertoire. For example by investing in building apps for the platform.”
Sony began to develop a strategy in Sweden of promoting playlists, as well as individual albums and singles. It developed its own playlist brand and app, Filtr, an approach which went global.
“It’s an example of how an affiliate in a major label can influence the whole global music company”
Highlighting how commercially viable these playlists can be, Sony Music now advertises them on television.
“If you had said four years ago that record labels in Sweden would be running TV ads saying ‘listen to this Spotify playlist’ rather than ‘buy this album’ people would have thought you were mad!”
Herbst is able to use Sony Music’s experience in Sweden to the advantage of its operations in other countries.
“We visit markets when Spotify is about to go live and help our teams get up to speed as quickly as possible by walking through best practises from other countries. Working with streaming music subscription services is very different to physical stores or download services. My role is to assist our companies in these markets with this process.”
He is optimistic that other markets will be able to benefit from streaming services in the way that the Nordic markets have. “I think there is huge potential in emerging markets. I’m particularly excited about Brazil, which, in many ways, is similar to the Swedish market when Spotify launched. Sony Music Brazil has done such a great job establishing itself as a brand on platforms such as Facebook and I will be really keen to see how well it does on streaming services, building and promoting playlists.”
Herbst’s acknowledges that telecoms companies have played an important role in building the success of streaming services.
“I come from a telco background and I can say that they have hugely helped the development of services such as Spotify and Deezer with the deals we’ve seen from the likes of Telia, KPN and Orange. Most telcos have been less successful in developing their own music services, but have found that by working with dedicated music platforms they have been able to improve the value of their brands and reduce customer churn.”
He believes that the benefits of such partnerships for the music market are also clear.
“As the Swedish market turned around Sony Music has begun to invest more in artists. We’re now paying royalties to more artists than ever before. We’re signing artists from more genres to meet the demand of consumers who are using streaming as a music discovery tool. After ten years of reducing the award thresholds for Gold and Platinum records we’re increasing them again, and more artists are receiving them. That’s the message I am taking around the world.”
