Analyzing Spotify's Opportunities and Challenges in the Indian Market

This report examines the expansion of Spotify into the Indian market, analyzing the opportunities and challenges the company faces. It begins with an introduction that highlights the use of PEST analysis to understand the political and economic conditions of the Indian market. The report then explores the economic freedom in India, noting the impact of GDP fluctuations and unemployment rates. The opportunities section focuses on factors like the country's need for Foreign Direct Investment (FDI) and the growing consumer base adapting to foreign culture. Challenges discussed include the low GDP, high-interest rates, and the impact on consumer spending. The conclusion emphasizes the importance of market research for successful business expansion, referencing the need to understand market trends and consumer behavior.

IDENTIFYING
OPPORTUNITIES AND
CHALLENGES OF
SPOTIFY IN INDIA

Table of Contents
Table of Contents.............................................................................................................................2
INTRODUCTION...........................................................................................................................2
ECONOMIC FREEDOM................................................................................................................2
OPPORTUNITIES...........................................................................................................................3
CHALLENGES...............................................................................................................................3
SUMMARY.....................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
In the present report the company Spotify is expanding its business within the Indian
market for purpose of growth and development. For this the PEST analysis of Indian market has
been conducted and on that basis the company will find the different types of opportunities and
challenges being present in the Indian market (Conboy and Carroll, 2019). The political
condition of the Indian market is not good as there is not good relation among the Indian and
Chinese market. In addition to this the 20 Indian soldiers were being killed by the Troops of
China in recent altercation. Also, the governmental control is not proper in the country and there
is too much of instability. But on the other side the economic condition of the country India is
also not very good. This is due to the reason that the GDP of the country has decreased by 4.5 %
because of the pandemic of COVID – 19. Also, the unemployment rate of the country has been
27.1 % which the highest of all. Thus, on the basis of this political and economic condition the
major opportunities and challenges for Spotify in India are as follows-
ECONOMIC FREEDOM
With this above data and chart it can be seen that GDP of the country India has reduced to a great
extent. In the year 2017 in the fourth quarter the GDP of the country was 8.1 % and this has
reduced to a great extent. In the year 2019 in the quarter 2 the GDP was 4.5 % which is very low.
This was majorly due to the reason of the pandemic situation of the COVID 19 that the GDP of
the country is at so low and now the country is trying to develop itself and reach to the better
position in the near future as well.

OPPORTUNITIES
The opportunity is referred to as the situation or the activity which will provide benefit to
the company by giving them opportunities to grow and develop in the other market or the
country (Salazar, 2018). The major opportunities for Spotify in Indian market are as follows-
The first and foremost opportunity for Spotify is that the economic condition of the
country is nit much stable and there is requirement of fund and money for the companies and for
this the company is encouraging Foreign Direct Investment (FDI) in the country. This is an
opportunity for Spotify because of the reason that the country is in need of finance and for this
they will give some of the relaxation to the company Spotify as they are bringing the foreign
money. Thus, this will be beneficial for both that is Spotify and the Indian market. This is due to
the reason that when the company will enter in Indian market in form of FDI then they will get
some benefits and relaxation and which is beneficial for company. On the other side the Indian
market will be benefitted as this will help the country in getting the foreign currency
(Viswanathan, Guillot and Grasso, 2020).
In addition to this another major opportunity for the company Spotify in entering the
Indian market is that the country is a developing country and the people of the country are trying
to adapt to the foreign culture. Thus, this will assist the company in capturing the market which
is growing and this will assist the company in developing a good market. Hence, this is an
opportunity for the company as they will get a new market and in addition to this the resources
being present in the Indian market are very cheap as compared to the other developed countries.
Hence, this will assist the company Spotify in incurring less cost as they would have incurred if
they will go in any of the other developed nation.
CHALLENGES
The challenges are referred to as the problems or the difficulty which the company may
face at the time of expanding its business in any of the other country (Friesner, 2019). The major
challenges being faced by Spotify while entering in Indian market are discussed as follows-
The most important and common challenge is the low economic condition and the low
Gross Domestic Product (GDP). This is a very common challenge for the company as if the
economic condition of the country is very low then the company will not be able to earn a good
amount of profit. This is pertaining to the fact that if the economic condition will be low then the
income of the consumers will be low and if this will be low then they will not be in condition of

buying anything. Thus, this will create problem for the company as the consumer will not buy
the goods and services being provided by the company (Eriksson and et.al, 2019).
In addition to this another major challenge for Spotify in the Indian market is the increase
in the interest rate on the amount being borrowed by the company. This is particularly a
challenge because of the reason that when the company wants to borrow money in the Indian
market then they have to pay for higher interest which may be low in their own country. Thus,
due to this the cost of the company may be high and this may reduce the profitability of the
company in the Indian market.
SUMMARY
In the end it is concluded that for the expansion of the business the market research is
very essential and the study of the market in which the company wants to go is of utmost
importance. This is particularly because of the reason that when the when the company will
market research then they will come to know about all the requirement and the trends going on in
the market and will assist the company to follow and abide by it for better functioning of
business.

REFERENCES
Books and Journals
Conboy, K. and Carroll, N., 2019. Implementing large-scale agile frameworks: challenges and
recommendations. IEEE Software. 36(2). pp.44-50.
Eriksson, M., and et.al, 2019. Spotify teardown: Inside the black box of streaming music. Mit
Press.
Friesner, T., 2019. The Fourth Industrial Revolution: an initial investigation into the marketing
opportunities and challenges for entrepreneurs.
Salazar, A., 2018. Hospitality trends: opportunities and challenges. Worldwide Hospitality and
Tourism Themes.
Viswanathan, S., Guillot, F. and Grasso, A.M., 2020, July. What is Natural? Challenges and
Opportunities for Conversational Recommender Systems. In Proceedings of the 2nd
Conference on Conversational User Interfaces (pp. 1-4).