Smart Speakers and The Consumption of Music

In a previous post, in which I announced my new position as Insights Strategist for Universal Music Group, I expressed an interest in the evolving media consumption behavior as a result of connected devices.

 Source:  Edison Research

With the dawn of the internet of things came the introduction of smart cars, connected home automation devices, and wearable technologies among other nifty connected devices. While these gadgets are all fascinating smart technologies, none have taken hold in US households as much as smart speakers. In January 2018, smart speakers were being used by consumers that fell within the “Early Adopters” and “Early Majority” stages of the innovation curve. According to an Adobe Analytics study, almost 50% of US consumers will own a smart speaker after the 2018 holiday season.

The smart speaker revolution is undeniable.

What does this mean for the consumption of music?

In the same Adobe study mentioned above, 70% of the respondents reported using their smart speakers for music consumption, which makes it the primary activity followed by weather forecasting (64%), and alarms/reminder (46%).

In my personal experience, using a smart speaker seems to remove the friction when wanting to listen to music. When I want to listen to music, I don’t need to manually look up an artist, album, song, genre, etc. There’s a clear consumer pain point that was being addressed. However, since most smart speakers don’t have a screen, that means the results for voice queries for music have to be much accurate. If we were to look up an artist on a search engine or music streaming platform, we’re given several songs or albums to to choose from. With the lack of a screen to refer to, consumers are given the one algorithmic-driven result deemed most appropriate by smart speakers. That means that these smart devices have one shot to get the customer experience right and pull up the “right” song.

Keeping in mind choice paralysis (there are times when I want to listen to music, but feel a little overwhelmed by the vast catalogue of music out in the world) and as consumers interact with smart speakers in much more intuitive and natural ways (as opposed to written queries) the dependence on genre or mood queries will play a key role in music consumption. But, with the melting pot of music genres, how does one categorize the genre-bending band Gorillaz, for example? In an ethnographic study that Edision Research conducted, we can see the toddler asks Alexa to play “Elsa” and “Frozen”. Besides the fact that pronunciation is an essential factor for smart speakers to deal with (think about how many consumers might be mispronouncing an artist name or lyrics), the smart speaker device should comprehend that the “Elsa” and “Frozen” prompt means to play “Let It Go”. But doesn’t this change if there’s an artist named “Elsa”?

All this means that there’s going to be a lazer-like focus on getting the music metadata right to serve up the right music at the right moment.

This is an extremely fascinating time to be alive. Voice is here and seems to be the future.

P.S. While there might be some apprehension from digital immigrants to use smart speakers, isn’t it fascinating to think that the same toddler from above is going to grow up naturally accepting Alexa as a digital assistant?

The Sunk Cost Effect

This cartoon’s pretty brilliant.

According to, the sunk cost effect is the tendency for humans to continue investing in something that clearly isn’t working. This tendency is due to time/effort/money already invested in the endeavor at hand. In the cartoon to the right, the sunk cost effect is shown by the dog’s irrational behavior to follow through with further digging even after not finding his bone after digging a bit.

This behavioral quirk is quite popular in the investing field. Instead of cutting losses, investors have an inclination to hold onto shares of a company after the shares fall in value, in hopes that the value would increase. These investors are reluctant to admit that they’ve made a bad investment and would prefer to hold onto those shares instead of reinvesting in another company.

To provide another example: I’ve recently been debating about switching my paid music streaming subscription service from Spotify Premium to Amazon Music Unlimited. Being that I’m an Amazon Prime member, my Amazon Music Unlimited subscription would cost $7.99 per month. In my current Spotify Premium plan, I’m dishing out $9.99 per month. If following rational economic theory, I would switch my subscription over to Amazon because… well, it just makes sense financially! However, in being the “irrational” consumer that I am, I haven’t switched over due to the fact that I keep thinking about all the time I’ve invested in creating my Spotify playlists - a clear case of the sunk cost effect.

Super-Size It

In customary, almost religious fashion, the new generation of iPhones were unveiled this last Wednesday at the annual Apple “Special Event”.

 Source:  Reuters

Source: Reuters

Data from social media chatter showed a lack of consumer purchase interest (and, in turn, investor sentiment) for the new models (dubbed the iPhone Xs, iPhone Xs MAX, and iPhone Xr) in comparison to previous iPhone products. While the new models don’t really offer any major breakthrough features, it caught me a little off guard when I heard one of the phones was going to be bigger than the iPhone X.

Yup. Bigger.

For someone who has a 5.5-inch sized iPhone 6 Plus that can barely fit it into the front pocket of my slacks, it was difficult to comprehend why someone would need, much less want a huge phone (the iPhone Xs Max’s 26% larger than the previous largest iPhone display, diagonally measuring 6.5 inches).

The ginormous screen size will play a pivotal role in the Chinese market. Apple has been losing market share to Samsung and their series of Galaxy Note 9 products, and hopes to tap into the larger screen size trend.

Moreover, according to a Wall Street Journal podcast episode, Apple decided to supersize the iPhone to drive profits. When it comes to consumer behavior, bigger screens means more time on the phone and more time on the phone equates to an increase in the likelihood you’ll end up downloading applications to stream media or play games. The more apps purchased, of course, means more money in Apple’s already sizable pockets.

 Source:  Reuters

Source: Reuters

Smart move by Apple. While the company makes the majority of their revenue from the sale of the iPhones (about two-thirds of sales comes from iPhone sales), the company is undoubtedly taking certain steps to relay less on the sales of their hardware products and make their ecosystem even sticker. With Apple making further in roads into film industry with recent film acquisitions and even eyeing a subscription offering for a bundled entertainment service package, it’s clear why analysts are forecasting continued double-digital growth for Apple’s services business arm.

Bullish sentiment much? Yeah. Like most of you guys, I’m not sure what the future holds, but my fundamental analysis of Apple puts them at the center of the consumer tech space. Could this also be why Warren Buffet’s Berkshire Hathaway decided to increase their holdings of Apple shares 5%, making them the 2nd biggest shareholder, earlier this year? Perhaps…

What Doesn't Get Measured...

... doesn't get managed.


This was too good to not share. Credit goes out to Tom Fishburne from the Marketoonist.

When it comes to the marketing field, I've always found it quite interesting that to many people, the term "marketing" is synonymous with "advertising". In other words, these folks think marketing is all about coming up with a well-designed ad and spreading to the word about a business or brand.

Yes, advertising is an aspect of marketing communications. Yes, it's important to communicate your value proposition to drive short-term sales and build long-term brand equity, but if you're not measuring your marketing campaigns, how do you know if your marketing dollars are being utilized in an optimal way?

Unless you're living in a world where money grows on tress, there's normally a limit to your marketing budget. With that being the case, resources have to be used in the most effective manner possible. In order to increase the return of investment (ROI) of the marketing campaigns, marketers and marketing researchers utilize a variety of methodologies, from marketing mix modeling to brand equity trackers, to evaluate marketing effectiveness.

As useful as some of the above-mentioned methodologies are to help maximize your marketing ROI, you need to established what your current ROI is. To those aren't familiar with the concept of ROI, the essential ROI formula equals to net profit (from a certain marketing campaign) divided by investment amount (for said marketing campaign) multiplied by 100 (ROI's expressed as a percentage). An ROI of 0% is your break-even point and an ROI of 100% means that you doubled your money. I would suggest using Microsoft Excel or Google Sheets for the calculation and easily creating a chart to visualize the data.

While the idea of ROI starts to become a little fuzzy around branding, you want to keep your pre-established key performing indicators (KPIs) for the business in mind and work towards meeting the goals for these KPIs.

The moral of the story - marketing isn't just about creating pretty ads and promoting them.

Marketing's both a science and an art, requiring creativity in producing out-of-the-box strategies, but also analytical rigor to measure what works and what doesn't. Don't let your marketing dollars go to waste.

eSports, Graduation, and Miami

The last couple weeks have been a whirlwind.

Not only was I inundated with final exams, group presentations, and my capstone project to wrap up my Masters program, but having also recently landed a position with Universal Music Group in Miami, I had to find a place to live & coordinate my move from Madrid to the Sunshine State which had to happen before my graduation ceremony!


The first thing on the agenda was the capstone project. The Market Research and Consumer Behavior Masters program at IE requires a final 8-week project, which allows students to integrate all the knowledge and skills that were mastered during the program, to develop a unique solution to a real-world challenge provided by the client. My six-person consulting team was assigned the task of validating current business drivers and gauge new opportunities within the eSports industry in the Peruvian market.

I had heard of the term "eSports" here and there before the project, but I can honestly say that didn't know much.

I knew of PewDiePie, who's currently the most subscribed-to YouTube personality (for the sake of comparison, he currently has a whopping 64 million subscribers while Beyoncé has 17 million), and his rise to fame on the platform from video content in which he would document the playthrough of video games while including commentaries and reactions as he played through them.

I also knew of Twitch, the Amazon-owned video game live streaming video platform, but I couldn't come to grasp the interest in the platform. I couldn't understand why someone would want to spend time watching someone else play a video game. Then I thought back to my younger days (when I was a bit more into video games). I remember having just a good of a time watching my friends play Super Smash Bros. instead of playing. I didn't need to be playing to have a fun experience with the game itself.

As I came to find out, eSports is considered competitive gaming at a professional level and in an organized format (a tournament or league) with a specific goal (i.e., winning a champion title or prize money) and a clear distinction between players and teams that are competing against each other. The eSports industry is also rapidly growing. In the coming year, the global eSports economy will ballon to $905.6 million, up 38% YoY and, according to market research firm Newzoo, the industry is currently estimated to reach $1.4 billion by 2020.

Overall, this was a fascinating project to work on. The industry growth figures were pretty impressive, so I'll be keeping a close eye on eSports moving on. Being that our presentation to the Telefónica team took place on July 5th and was hired to start my new position with UMG on July 10th, I had to fly out Miami the day after our presentation. Not much time to celebrate, but there was plenty of time down the road for that.


After setting up shop and getting settled in Miami for about two weeks, I had to fly back to Madrid for graduation.

The jet lag was awful, but there were no regrets in my decision to fly back out for graduation. Being that I graduated early from high school and that I had to travel during my Bachelors graduation ceremony from LMU, I hadn't graduated on stage since kindergarten. That being the case, my family really appreciated seeing me formally receive my diploma in the traditional graduation get-up and what not.


It was a quick four days back in Madrid, but I now officially have my Masters in Market Research and Consumer Behavior. Feels good to write.

Madrid - it's been great, but onto the next chapter...


I'm now back in Miami.

I swear, every time I hear "Miami", I think - palm trees, cuban food, and Will Smith (yes, I'm an 80's baby and very clearly remember the chart-topping single from The Fresh Prince). A friend had also recommended that I check out the HBO series, Ballers, which is set in Miami. I'm not a huge Dwayne Johnson fan, but the trailer looks pretty good.

I can't say I would have imagined relocating here prior to my position with UMG, but I've lived by the ocean for the majority of my life (with the exception of Outat El Haj and Madrid) so I thought "why not?".

My first non-consecutive three weeks at Universal Music have been wonderful. I have a good grasp of the business side of things and I'm now learning the proprietary insights tools I'll be using for work. I also went to my first concert (Pusha-T at Story) and my first work-related show last night (Nacho at The Fillmore). All in all, everything's been great and Miami's starting to feel like home. More updates to come.

 The view from our office.

The view from our office.

Adventures in Taste Testing for New Product Success

You know how people say the devil is in the details? Well, that couldn't be truer than with taste testing.

During college I participated in my fair share of paid food research studies (which was a great way to make a quick buck as a college student btw). While I took part in these taste testings, I never really gave much thought to the complexity of the research until years down the line when I decided to conduct taste tests for a food product I was considering bringing to the market.

As with most consumer usability testing, consumer taste research design is pretty complex. Some of the considerations include testing location, in addition to whether you want to reveal the product brand, conduct the research with a group of people verses one person at a time, and who exactly you're going to be recruiting for the study. Mike Burkenbine and Kathryn Korostoff do a great job at breaking down some of the research details below.

Some of the key take-aways from the video include:

  • In-facility testing is vital. In-store/in-restaurant should be conducted as a second part to the research.
  • "People eat with their eyes" - be weary of variables, whether it be the color of the packaging or serving utensil, that might affect gustation via vision, audition, olfaction, and somatosensation.
  • Ethnographic research might be best for packaged products that are made to be used at home (e.g. frozen meals).
  • Conduct blind testing first to check if the target market likes the product, then conduct further branded testing to check brand association.
  • Beware of regional differences in taste preferences.

If you've ever wondered how CPG companies and restaurant chains what food and beverage products to sell (and mitigate some of the business risk of launching a potential flop), consumer taste testing is the way to go.

UMG & Marketing in the Music Industry

Mixing Board

I've been completely infatuated by the business of entertainment for some years now. As I reflect on my interest in this industry, I can boil it down to a couple points:

  • The growth of media streaming platforms, their business models, and how the different players within the streaming ecosystems capture value

  • Connected devices causing a shift in consumer behavior as it pertains to media consumption

  • Monetizing intellectual properties as a form of passive income

The entertainment industry is undergoing major changes and it's all pretty exciting. 

In the back of my mind, I knew I was going to end up working in the industry soon or later. Guess it looks like it'll be sooner than later.

I'm proud to announce that I'll be working as an Artist Brand & Insights Strategist at Universal Music Group starting next month.

As I wrap up my grad program and gear up for my new role, I've been studying up on the industry. In doing so, I came across Bobby Owsinski's Inner Circle music podcast - a highly recommended podcast series for anyone interested in the music industry. In the episode below, industry veteran & Music Executive Ted Joseph talks about radio promotion, retail store co-op advertising, and more during his time as Head of Marketing at Warner Music.

Why StartUps Suck At Marketing

If you're at least somewhat familiar with digital marketing or SEO, I'm sure you've come across one of Moz's Whiteboard Friday tutorial videos at some point. From strategic online consumer behavior videos to more technical keyword targeting tutorials, Moz's weekly video series has been providing undeniable value to the beginner-to-intermediate digital marketing practitioner that's looking for easy-to-understand information on just about any SEO-related topic.

Rand Fishkin

In front of the camera during his tenure at Moz has been Rand Fishkin. Co-Founder and previous CEO of Moz, Founder of SparkToro, Author of the recently published "Lost And Founder", speaker, & blogger - the man has achieved monumental success in the SEO business and is today one of the leading authorities in digital marketing.

Last week, the IE Marketing Club had the pleasure of hosting the SEO Wizard himself, who gave an enlightening presentation on "Why Startups Suck at Marketing". The event at IE was a couple months in the planning, so we were pretty excited for the day to come and have Rand share his wealth of experience and knowledge with us.

According to Rand, the 8 ways startups suck at marketing are:

  1. Terrible names
  2. Overvaluing 1st exposure
  3. Chasing growth hacks
  4. Saving marketing until launch
  5. Relying on paid ads
  6. Not prioritizing an easy-to-reach audience
  7. Failing at funnel fundamentals
  8. Ignoring brand

I'm sure the presentation served as a precursor to what I'm going to find in his book (just ordered my copy a few days ago). Being a Marketer and having previously launched a few businesses of my own, I'm certain I'll find Rand's book just as valuable as his Whiteboard Friday videos. For some marketing wisdom (and a sneak peak at Rand's book), swing by Moz's blog post in which Rand shares his best advice from a decade and a half of marketing Moz or listen to the audio version below.



It's quite fascinating to reflect on how irrational people can be.

And it's perfectly normal to be irrational. We can't be completely rational all the time right? 

This irrationality is part of our bounded rationality. According to Herbert Simon, recipient of the Nobel Prize in Economics in 1975, people have cognitive limitations and because of that, we go about making sub-optimal decisions in our everyday lives. Through this lens, people unconsciously act as "satisficers" in their decision-making, seeking to make a satisfactory decision instead than an optimal one. In order to facilitate the decision-making process, we act on instincts, habits, heuristics, cognitive illusions, and biases - leading us to "satisficing" decisions.

This is innate within all people. During this unconscious part of the decision-making process, we formulate stories - stories that support our beliefs.

Thomas Gilovich, Author and Professor of Psychology at Cornell University who has contributed to the behavioral economics field, describes these stories as a result of "Patternicity", the tendency to create meaning from events. While this evolved trait (think hunter-gatherers hearing rustling in the grass and believing it might be a predator) greatly served our ancestors, "patternicity" leads to irrationality, poor decision-making & bias.

While the topic of ethics relating to behavioral economics makes for another blog post, marketers have been using the underlying biases in "satisficers" to create effective marketing campaigns advantages for decades. From loss aversion to anchoring, there are plenty of biases for marketers to utilize. With that being said, potential consumers can offset this targeting by being "intuitive scientists" - a nice little secret from Thomas in the video above.

 Image Credit:  Behavioral Scientist

Image Credit: Behavioral Scientist