The Songza business: Conversation with Elias Roman, CEO

songza canvasInternet radio platform Songza has built its reputation on the so-called Concierge method of music curation. The Concierge service seeks to understand the user’s mood and activity, match it to time of day, local weather, and other signals, combine all that with historical music preferences, and deliver a perfect soundtrack (playlist) for the moment.

This method of playlist discovery has been imitated, most recently by “The Sentence” in Beats Music. Rhapsody, iHeartRadio, and others have also gone down this path to varying extents.

Wanting to know more about the anatomy of Songza Concierge, and also how it ties into monetization through ad sales, we spoke with Elias Roman, CEO.

“We are a lifestyle enhancement service.” –Elias Roman, CEO, Songza

Roman emphasized the Big Data operation within Songza as the beating heart of Concierge, and referred several times to the importance of context in predicting what people want to hear..

elias roman twitter crop 01 canvas“We use whatever data points we can to predict what you’re doing, with the belief that you cannot possibly recommend content if you don’t understand context. We invest a lot in understanding the context. Songza is becoming the service that users want to know exactly what they’re doing at any particular time, because what we’re doing with that data makes their life better. Waking up, sleeping, entertaining, getting through the work day, whatever.”

As we reported in March, Songza partnered with The Weather Channel to insert weather conditions into user profiles, as a new signal which helps Songza figure out mood and activity.

“We partnered with The Weather Channel — that allows us to use the real-time weather around you to predict what you’re likely to be doing, then service content based on that. So weather is a new signal that we’ve added to our tech stack, and it is the highest-converting content we offer.”

songza concierge 250wElias Roman explained that “conversion rate” is one of Songza’s key performance metrics internally, and is measured by tracking impressions within the app which lead to a streamed playlist. So, if you click on “Working in an Office,” and start a stream based on that activity, Songza knows that “Working in an Office” converted to a music session in that one instance. “Weather converts at a disproportionately high rate,” Roman told us. “It has stepped up our game.”

“Before this year there were six data signals: time of day, day of week, type of device, IP address, what you had done before, what everyone had done before. It’s incredible to see how our database has grown, so that using just those indicators, most of which are not personal, we can accurately predict what you’re doing.”

The Songza CEO discussed a new signal that can be derived from the six basic ones: Lifestyle.

“We can quickly get an indication of what your lifestyle is — young parent, 9-to-5’er, hipster, health nut, de-stress’er. We can group our existing users, and new people into these lifestyle buckets. Even if we’ve only seen you practice yoga, commute, clean the house, and cook, we also know that entertaining friends on Thursdays and Friday’s, and spending time with your family, are situations that you’ll be disproportionately inclined to convert on when we show them to you.”

On the content side, Songza has a small army of 60 curators building and refining playlists. Those curators, most of whom are freelancers working in their homes through Songza’s publishing system, are exposed to user voting data — thumbs-up, thumbs-down, and song-skipping. “They don’t have to change their playlist selections based on that information but it can inform their decisions,” Elias Roman said.

When we asked Elias Roman about competition in the concierge-curation business, he made it clear that data was the big differentiator.

“It’s easy to overlook the data part of concierge work. We have massively collected and well-processed data. [The problem for competitors is,] you can’t buy it, or scrape it, and you don’t have it on Day 1. No matter how good a job you do with assigning playlists to activities, it will feel like a mapped experience that has no data behind it. It can feel cold and impersonal. The whole point is to feel warm and personal. When Songza launched we obviously didn’t have that data either, but there was no alternative. Now we’ve got a ton of data, and nobody else has any.”

All this data delivers a personalized app experience used by 5.5-million Songza users. How does it affect the business side? We asked Elias Roman to dig into the monetization picture.

“We’re really pleased with how that’s coming,” he told us. “Earlier this year we announced a partnership with Unilever, the second-largest advertiser in the world. They identify a small number of platforms they want to get behind. Being selected as a partner has been awesome, and a validation of the platform we’ve built.”

Roman sees a sharp difference between Songza’s value proposition to advertisers, and that of other music services.

“The fundamental difference is that we don’t think we’re a music service. We don’t try to monetize like a music service, with volume ads. ┬áThat means we have the mandate of making the things you do every day better. The ads cannot make the things you do worse, the way interstitial audio ads sometimes can. So many RFP [requests for proposals] actually reference a mood or aspiration, or situation during the user’s day, that the brand wants to be associated with. Very few publishers can deliver on that request literally. That has been really helpful on the monetization side.”

As an example, Elias Roman described how an ad campaign might play out on Pandora, compared to Songza.

“Let’s imagine Nike, and an ad buy on Pandora compared to Songza. With Pandora, the conversation might go something like this: ‘We want to move the Nike+ Running App. Let’s target people in a demographic, and let’s run an audio ad for the product.’ In the best case scenario, you identify who the runners are on Pandora and serve them an audio ad while they’re running. So Nike has paid money to piss people off at the moment you want to say you can be better for them. It’s the antithesis of how Nike wants to spend its ad dollars.”

“Songza can take the running situation, and turn it into Running With Nike. Right before the playlist starts we can stream a 15-second pre-roll, maybe saying how you can track and improve your running with the Nike+ Running App. The ad that you show might target that you’re on a run at a certain time of day, but there’s no interruption to the run. It is a better run for Nike having brought it to your screen, not a worse run.”

Roman wrapped up the philosophy like this: “If ads are ads, people ignore them. But if ads are consumable content, people want to consume them.”

Brad Hill