That’s according to an early assessment by NPD Group analyst Russ Crupnick, who sees very little sign of Spotify-generated cannibalization on downloads.
In fact, he’s witnessing the opposite: since Spotify arrived in the US in July of 2011, Crupnick has observed that Spotify users are twice as likely to purchase a song download from iTunes or Amazon.
“I can tell you that we see Spotify (I’m talking free) users more than twice as likely to be buying digital downloads compared to non-users, and that ratio has not changed since the introduction in Q3 ’11.”
This is based on a quarterly, music-focused consumer survey that NPD has been conducting since 2001, specifically involving Americans over the age of 13. The company now claims a 95 percent accuracy projection, with the following stats showing up for the second quarter of 2012 (ending June).
- 38% of Spotify users report buying a song download in the past 3 months, compared to 17% for non-users.
- 36% of the tracks that Spotify users acquire are from paid download stores, a ‘reasonably steady’ number. (The rest is CDs, borrowing and burning/ripping, BitTorrent, etc.)
The hard numbers – particulary from Nielsen Soundscan – support the claim. After suffering a sales plateau, paid downloads seem to be elevating once again, in concert with streaming increases. All of that said, Crupnick cautioned that broader trend analyses will take time to formulate. Indeed, the on-demand streaming space is green; it could be millions of users away from maturity. “Once we can trend an entire year of Spotify data it will be more accurate in terms of assessing the impact,” Crupnick continued.
But that growth process also opens the possibility of serious cannibalization ahead. Part of the reason is that Spotify’s early adopters are really into music, which means they’re more likely to say yes to everything: streaming, downloads, vinyl, concerts, whatever. The next few million may be far less passionate, and less voracious consumers.