The Correlation between Perceived In-App Advertising and Brand Association of the Spotify Music Streaming Application with Consumer Purchasing Decision of Premium Services

Abstract

As digitalization continues to advance, in-app advertising plays a pivotal role in enhancing marketing strategies. Spotify, a music streaming application, implements in-app advertising strategy to encourage free users to subscribe to its premium services. The message conveyed in these in-app advertisements emphasize the relevant benefits and features of the service. This is expected to foster positive perceptions of the brand and its premium services. Through the development of positive perceptions, associations with the premium service can be established, potentially effecting consumer purchasing decisions for the premium subscription. However, annual data reveals a declining percentage of premium subscriber growth Year over Year (YoY) over the past 3 years. Therefore, the study entitled ‘’The Correlation between Perceived In-App Advertising and Brand Association of the Spotify Music Streaming Application with Consumer Purchasing Decision of Premium Services’’ was examined.

This research is a quantitative study using an explanatory method. Through semi-interviews with 100 participants, characterized as Indonesian individuals (male and female) aged 18-24 years who are Spotify users. The findings of Pearson multivariate correlation result reveal a positive correlation between perceived in-app advertising and brand association of the Spotify music streaming application with consumer purchasing decision of premium services. This is supported by significance values less (<) than 0.01, with a positive correlation strength that is cathagorized as moderate (0.459). These findings align with the advertising Exposure Theory by Batra R., Myers J., and Aaker D. The results suggest that Spotify can enhance ad optimization and brand building strategies to improve consumer perceptions and brand associations, thereby increasing the probability of users subscribing to premium services.