Spotify Growth Plan: Converting Free Listeners and Reducing Premium Churn

You are a product manager on Spotify Premium. Put together a plan to grow the number of people paying for Premium, and explain how you would know it is working. ```hint Follow the subscriber math The paid subscriber count rises with new conversions and returning subscribers and falls with cancellations and failed payments. Decide which of these flows has the most room before you brainstorm features. ``` ### Clarifying Questions - Is the target net paid subscribers, which counts cancellations, or only new paid sign-ups? - Should the plan focus on people already listening on the free tier, on former subscribers, or on people who do not use Spotify at all? - Are pricing and plan changes (Student, Duo, Family, new tiers) in scope, or only product and marketing levers? - Is there a market focus, such as countries where most listeners stay on the free tier? ### What a Strong Answer Covers - A goal framed as net paid subscribers, broken into conversion, retention and win-back levers - A deliberate choice of segment, such as engaged free listeners or former subscribers, with the reason - The barriers that stop that segment from paying, and product, packaging, pricing and payment ideas that remove them - Prioritization plus success metrics with guardrails on revenue per user, free-tier engagement and ad revenue - Risks such as discount dependence, trials that never convert and pushing free listeners away ### Follow-up Questions - Trials lift sign-ups, but many people cancel when the trial ends. How would you decide whether a longer trial is worth it? - Would you make the free tier less generous to push upgrades? Where would you draw the line? - A cheaper plan with fewer features would add subscribers but lower average revenue per user. How would you decide whether to launch it?