Managing Innovation: Application of Blue Ocean and Disruptive Innovation Theories in the Context of Spotify

Managing Innovation
Report

Table of Contents
INTRODUCTION...........................................................................................................................3
Application of Blue ocean strategy in context to the historical development........................3
Historical development of Spotify..........................................................................................5
Disruptive innovation theory..................................................................................................6
Process of disruptive innovation:...........................................................................................6
Principles of Innovative disruption theory.............................................................................7
Benefits to disruptive innovations:.........................................................................................8
Limitations of disruption theory;............................................................................................8
Application of Blue Ocean Strategy Innovation Theory........................................................8
Application of Blue Ocean Innovation theory and Disruptive innovation theory in the context
of future progress of Spotify.................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES .............................................................................................................................13

INTRODUCTION
Innovation is a process that is in concern with development of a new idea so that there
can be developments that can be made in existing products in order to enhance the
competitiveness of a particular brand or product in the market. Innovation management is
regarded as a process where there is promotion of a new idea according to the internal and
external environmental factors that are posing a impact on the functioning of the organisation
(Tidd and Bessant, 2020). Present report is based on Spotify that is a Swedish media service
brand and a audio streaming provider which was established in the year 2008. its head office are
present in Stockholm, Sweden. The report is based on the process of historical development that
is taking place in a organisation with application of different innovation models in order to
analyse the future development strategies that can take place in the organisation.
Application of Blue ocean strategy in context to the historical development
COMPANY OVERVIEW:
Spotify is a Swedish brand that is offering a platform for their target segment of
customers who are music lovers. It was launched in the year 2008 and is owned by spotify AB
since 2018. they are offering digital copyright restricted recorded podcast and music that
includes 60 million songs that are from media Companies and record labels. Its basic features are
free from advertisements and posses a limited control. It also includes additional features such as
commercial free listening, offline listening that is via paid subscriptions and users are able to
search for music based on genre, album and artists (Nardelli and Broumels, 2018). There is also
facility of edit, create and share their playlists. This brand is having presence on Europe and
other some of the parts of Asia and Africa. According to data of October 2020 there have been
320 million active users on this platform that also includes 144 million paying subscribers.
VISION:
Spotify has a vision that is to offer a common platform to people that can provide them with a
best experience of music.
MISSION:

Mission is related to transformation of objectives and aims that is aimed to achieve the laid
objectives by enhancing their market share and customer reach.
BUSINESS CANVAS MODEL:
Key Partners:
 Third part
integrators
 Artists
 Record of
companies
Key Activities:
 Web
developm
ent &
maintenan
ce
 Marketing
 Maintaini
ng content
 Maintaini
ng of
music
library
Value
Proposition:
 Listening
to million
of songs
 Instant
access to
music
 Access to
playlists

Customer
Relationships:
 Assistance
with
website,
Facebook,
Audio
streaming
Customer
Segments:
 Free users
 Developer
s
 Subscriber
s
 Advertiser
s
Key Resources:
 Technolog
y
 Brands
 Employee
s
 Algorithm
 Brands
Channels:
 Web
applicatio
ns Mobile
applicatio
n
 Internet
Cost Structure:
 Platform
 Customer service
 Development
Revenue Streams:
 Advertisement revenue
 Revenue from subscription fees