How A Streaming Music CIO Plans On Turning Things Around

How A Streaming Music CIO Plans On Turning Things Around

Pandora's CIO has plans to stop its loss in users
Pandora’s CIO has plans to stop its loss in users
Image Credit: Jenni Konrad

Having the CIO job at Pandora would put you right in the middle of a busy and challenging market. Streaming music is very hot right now and there are a lot of different companies that are involved in the market. This all means that there is a lot of competition. Pandora is one of those companies and just like everyone else they are finding themselves having to fight for your listening time.

Pandora’s Challenges

Pandora is a very popular service. What has attracted a lot of customers to it has been its ability to offer free personalized music stations. However, now the company finds that it is struggling. Its users have been migrating to Spotify and to Apple Music because those services allow their customers to play individual songs on demand. As the users have gone away, so have the advertising dollars . Although struggling, Pandora is still the largest streaming music provider in the U.S.

The person in the Pandora CIO position realizes that now, more than ever, the streaming music business is more competitive than it has ever been before. What this means for Pandora is that in order to be successful they are going to have to understand the importance of information technology and always be innovating. The people who listen to Pandora say that a reason that they might leave is because they currently cannot listen to a given song on demand. This is an area where the company is trying to make some changes. In order to capture more customers, Pandora now offers three levels of listening: free but with ads, $5 per month with no ads, and $10 per month where you can select the songs you want to listen to.

One of the things that Pandora has been able to build up while they have been in business is a great deal of information about their customers and what types of music they like to listen to. Pandora believes that going forward, advertising is going to be less about big brand campaigns and will instead be more about how to go about creating a unique connection with an individual customer. They view this as giving them the ability to create a targeted message for a customer based on what information they have been able to collect about them. Pandora believes that this is an opportunity that they can now take advantage of because they have the data to do it.

Pandora’s Plans For The Future

Pandora’s CIO realizes that it is going to have to use technology to win back customers. Some of the things that they have planned for the future include their own on-demand subscription service (called Pandora Premium). They recently introduced a service that allows users of their free service to get 30 minutes of free on-demand listening if they are willing to watch 15 second ads. One of the things that sets Pandora apart from its competition is that it has collected a great deal of information on its users and what types of music they like.

It is this type of information that Pandora believes they can use to help advertisers better target their ads. Having had success with music, Pandora is now attempting to apply the same set of analysis and algorithms to other nonmusic forms of entertainment such as podcasts. Their goal is to be able to make personalized recommendations to their users. What they hope to be able to do is to serve up personalized ads for their listeners. In order to do this, their advertisers are going to have to be able to create thousands of versions of their ads easily and efficiently.

Pandora knows a lot about their customers. What this means is that they know how to serve up ads to their customers. Since they already know what song will be positively received by one of their customers, they can also predict which ads will be positively received by them. They also know when to serve an ad – or not. They know that if a customer has just rejected a song that is a poor time to try to deliver an ad to them. Pandora can also tell if a given customer responds best to ads in the morning or afternoon and which day of the week they respond the best to ads during. Additionally, they can tell if a customer like fewer longer ads or more shorter ads.

What All Of This Means For You

Streaming music is in the process of changing how people choose to receive their music. The CIO of Pandora is in the hot seat as the company attempt to find ways to get people to stop leaving the firm. The secret to long term success is for the company to find ways to reinvent itself, but just exactly how should they go about doing that?

Pandora is losing customers to Spotify and to Apple Music because those services allow their customers to play individual songs on demand. The people who listen to Pandora say that a reason that they might leave is because they currently cannot listen to a given song on demand. Pandora believes that going forward, advertising is going to be less about big brand campaigns and will instead be more about how to go about creating a unique connection with an individual customer. Pandora’s CIO is going to have to find ways to use technology to win back customers. They have plans for an on-demand subscription service and a way to eliminate ads from the free service. Pandora is trying to use their algorithms to determine what types of non-music entertainment their customers would like to listen to. Pandora knows a lot about their customers and how they like to receive ads, when they like to receive them, and in what format they are willing to receive them.

The Pandora CIO has a great deal of customer data at his or her fingertips. Now what they are going to have to do is find a way to use that data in order to help their advertisers. The goal is to be able to deliver the ads that people will listen to, when they will listen to them. There is no question that Pandora has the needed data and the algorithms to accomplish this, the CIO just needs to make it happen!

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: How do you think that Pandora can measure how successful their ads are?

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