Given massive assortments and limited consumer knowledge, platforms may homogenize consumption by steering consumers to the same content. To study this issue, we analyze music consumption for pairs of consumers around the time they adopt Spotify, a major music streaming platform. We find that Spotify adoption indeed makes listening behavior more similar across consumers, and we interpret this by decomposing the effect in two parts. First, Spotify expands the size of the consumption set, increasing expected listening similarity even in the absence of any platform-directed coordination. Second, after adjusting for consumption set expansion, the adoption of Spotify decreases similarity in content consumption. These effects increase over time and are stronger for heavy users. Rather than steering large groups of consumers to the same content, this paper, therefore, suggests streaming services expand yet individualize listening behavior, something consumers likely find valuable. We discuss implications for consumers, artists, labels, and marketers.
|Place of Publication||Tilburg|
|Publication status||Unpublished - 23 Jul 2020|
- streaming platforms
- music consumption