The music streaming platform claims to have seen 3x rise in subscriptions
While ad revenue accounts for 55% of the company’s revenue, the remaining 45% comes from subscription revenue
From strengthening non-film artists library to introducing multiple subscription packs, audio streaming platform Gaana has adapted itself to the new normal. In conversation with BrandWagon Online, Prashan Agarwal, CEO, Gaana, talks about the platform’s strategy in the time of covid. (edited excerpts)
What kind of growth Gaana recorded during the lockdown? How has the scenario changed now?
We witnessed a modest growth of 13% during the lockdown. During the lockdown, we had seen a huge growth in home consumption, but now with the economy opening up we expect a second wave of growth which will be driven by people who have started to commute. As for subscriptions, we have seen a 3x rise. This growth is primarily attributed to the fact that we reduced our annual subscription rates to Rs 399. Further, over the last six months, we have been doing a lot of decoupling of Gaana Plus. So, we now offer three packs — Gaana Plus, ad-free pack or languages pack. Hence, while Gaana Plus appeals to a certain connoisseurs of music, ad-free packs appeal to the masses. Decoupling as a move has helped us grow the subscription base.
What is your current registered user base?
As of now, we have 185 million monthly active users (MAUs) on our platform. As for paid users, we have the largest paid subscriber base in the music ecosystem. Our paid subscriber base is a low single digit percentage of the overall users.
How much does advertising contribute towards overall revenue and what has been the adverse impact of covid on the ad rates?
For Gaana, the revenue is an almost equal split between ad revenue and subscription revenue. While ad revenue accounts for 55% of our revenue, the remaining 45% comes from subscription revenue. As for rates, CPMs (cost per thousand impressions) had dropped across industry and the audio industry was no exception. However, the CPMs have now returned and are at pre-covid level.
How have you managed the inflow of the original content?
While Bollywood went through a slump during the lockdown period, it offered a great opportunity for non-film content to flourish. We saw a couple of labels leveraging this opportunity to push non-films artists into the fold of Gaana Originals. We have a strong library under Gaana Originals and we will continue to support labels and independent artists on non-film music because our belief is that non-film music will grow from here. We believe that non-film music is here to stay and will compete head on with film music. As of right now, we release about 50 songs in a year under Gaana Originals.
What is your marketing strategy?
Our marketing strategy has always been focused more on digital while building the brand. So from the spends perspective, our marketing spends are heavily skewed towards digital with support above-the-line (ATL) mediums. We plan to launch an ATL campaign post Diwali while our online campaign continues to run.
By when do you expect the business to turn profitable?
We expect to turn profitable around 2023 and will continue to work towards that. This fiscal, we expect growth to be muted in terms of revenues as ad revenue was adversely impacted for six months. Hence, this year we expect a modest growth in overall revenue.