Case Study Analysis - Leaf.fm

DE 7007 STRATEGY CASE STUDY ANALYSIS

LEAF.FM Kwan Sereratana w16030451 MA Design Management Northumbria University 2 May 2017

LEAF.FM THE NEXT GENERATION MUSIC EXPERIENCE Founder: Gilbert Corrales

Year of Foundation: 2013 Business Type: Music app

Company Type: Startup

COMPANY HISTORY Gilbert Corrales CEO

Leaf.fm is a music application for the next generation It is a social network that combines music and community for music fans to connect and support with their love artists.

application quickly scale up until it become one of the most success music application in Latin America. Today, Leaf.fm provide service for 187 countries with 370,000 engagements of music fans.

The company starts in 2013 in Costa Rica when Gil- In 2014, the company received funding from UK bert Corrales and his friends came up with an idea government program and now move to Newcastle of combine music, community and business. The

See also: https://developers.facebook.com/case-studies/leaffm/ https://angel.co/leaf-fm

VISION & VALUE “ We believe in a world where value can be built from a generation notoriously difficult to reach and who have grown up expecting free access to everything.”

Leaf.fm: The next generation music experience

The Diagram of Market-Centric Approach Process (Cooper & Vlaskovits, 2013)

SEGMENT

PROBLEM

PRODUCT

TECHNOLOGY

Passionate about music, Gilbert Corrales, CEO, thought it is time to improve the music service in nowadays as fans and artists were demoted, by coming up with the business model to make music become sociable again in a time that content is free (Peatfield, 2015) In long term vision, company aim to be platform where and artist and music fans get connected (Kahn, 2016) Using driving forces propose by Cooper & Vlaskovits (2013) to identify and understand the motivation of the company as the author pointed out that understanding company’s driving force would enhance competitive advantages. The interview result shows that company’s vision is driven by market-centric where the company begins to solve the problem for the specific market. This driving force would define the Leaf.fm direction which would discuss in next chapter.

Company History Vision & Value Corporate Culture Management Process PESTEL Analysis Five Forces Framework Competitive Analysis Company’s Innovation tool Product Analysis Competitive Strategy Investors & Startup Communities SWOT Analysis

WHERE ARE LEAF.FM NOW?

UNDERSTANDING COMPETITIVE ENVIRONMENT OF LEAF.FM

POTENTIAL ENTRANTS: MEDUIM

INVESTOR/ARTIST/ MUSIC CORPORATION: MEDUIM

COMPETITIVE RIVALRY: HIGH

USER ACCESS: HIGH

SUBSTITUTE: LOW

Five forces of Leaf.fm Michael Porter (Johnson et al, 2011) proposes five forces that influence the attractiveness of the organization. The framework helps the entrepreneur to understand the competitive of the industry. Traditionally, five forces are consists of threat of new entrants/substitute, power of buyer/ supplier and competitive rivalry. However, for the case of Leaf.fm, the investor/artists/music corporations are forces that affect the company, not the supplier. As the company’s staff is efficient in produce the mobile application there is no supplier involve but investor and artist are those who are engage. According to the diagram, the supplier force is replace by those three groups that had

been mentioned. In addition, the buyer for Leaf. fm is instead replace by users who download the free app.

1.Power of investor/artist/music corporation: MEDUIM According to Leaf.fm profile (Kahn, 2016), which recently received £450,000 funding on August 2016 and from other investors, investors quite interested in the company’s business. Artists who are engaged with company are mostly Latin band and newborn band, rarely to been attracted from mainstream artists and music corporation as the music app is still growing.

2. Power of potential new entrants: MEDUIM There are many music streaming startup arises such as Unify, Wolffy, Skrapps etc. due to the rise trend of startup and advance technology that offer new business to monetize. However, there is certain cost for app development if the startup team lack of designer/engineer expertise.

3. Power of substitute: LOW Currently, as the high technology of cloud service, it is hardly to find a technology that will replace the current one however music industry still need to be prepared for change as technology is rapidly changing. CD and vinyl are affected by the disruptive of nowadays music industry but yet serve for niche market, for the real core music fans. However, the niche market still hardly to replace the mainstream streaming music popularity.

4. Power of users: HIGH Users have more choices of their favorite cloud base music services due to many brands emerge.

5. Power of competitive rivalry: HIGH With the popularity of cloud base music business, there are many competitors within the industry such as Spotify, Pandora, Tidal.

COMPETITIVE ANALYSIS HIGH USER DOWNLOAD

FREE

PAID SUBCRIPTION

LOW USER DOWNLOAD

Using competitor analysis (Best, 2006) to analyze competitors of their current execution and identify gaps/ opportunities for product development. The matrix could be divided into a free application or paid subscription with high/low user download. Most of the music apps are in between of free download where users can download the free app and paid a subscription if they want to receive premium service. While Leaf.fm only provide free download for customers.

Spotify (100,000,000-500,000,000 users) : One of most popular music app that has the main highlight by providing music related to moods of customers.

The app offers 2 services. The first one is free service where customers can listen to every genre of music and their favorite artist. The second one, Spotify Premium is another service that has no commercial ad and customer can listen offline. (Spotify: free music streaming)

Soundcloud (100,000,000-500,000,000 users): The app not only provides music for the listener but also allows music creator to upload their song into communities. It offers 3 services; Soundcloud Free, Soundcloud Go, Soundcloud Go+ and Soundcloud Pulse. The Soundcloud Go/Go+ are paid service and Soundcloud Pulse is suited for music creators. Another highlight feature is the app allows music fans to share their favorite song within the app where people can see what other friends and artist share. (Soundcloud-music & audio)

Pandora (100,000,000-500,000,000 users): Pandora serves customers in 3 services. Pandora free is where customers can download for free while Pandora Premium and Pandora Plus are paid subscription for customers who look for extra features. Customers can create their own music station and the app also includes artist history and background. (PandoraÂŽ Music)

Deezer (100,000,000-500,000,000 users): Deezer comes in 3 services; Deezer Free, Deezer Premium+ and Deezer Family. The app allows customers to create unlimited playlists and provides music lyrics on screen. Another main feature, Flow, allows customers to customize their own playlist in one never-ending stream. (Deezer: Stream music & songs)

Leaf.fm (1,000,000-5,000,000 users): Leaf.fm differentiated itself by providing music with videos browse from YouTube. The app offers only free download where customers can share their music video through social media, provide personal music buddy and customer could follow their favorite YouTubers. (Leaf Music)

SHARE FEATURES IN SOCIAL MEDIA

EXPLORE PLAYLIST/ARTIST PAGE

ABOUT THE PRODUCT

ARTIST PAGE

Leaf.fm provide a free cloud-base music app where users can play their favorite music video from YouTube through the Internet. However, if the users want to download the song then they need to purchase it. With users from 187 countries, the product is most popular in 5 countries; Mexico, United States, United Kingdom, Colombia and Philippines where top 10 cities the app is used are Mexico City, London, Istanbul, New York City and Los Angeles.

The app is mostly used by the target group of both women and men from 18-24. (Leaf.fm: the next generation music experience)

STORE FEATURE FOR PURCHASE SONG

The mobile app includes wide ranges of music genres: Pop, Hip Hop, Latin, Electronic/Dance, Rock, Alternative/Indie, Country, and Reggae. The playlist also categorize into top charts/top artists/ spotlight. In addition, the app includes popular Youtubers; artists who engage in business through upload video in YouTube website.

Finally, the app provides a ‘mood’ playlist where users can choose music playlist according to their mood (such as love, passion) or according to the current activities of users such as shower, running, cooking.

The music app has another several features. Firstly, it provide search engine for users to search playlist.

Secondly, the app provides a music personal assistance chat box where users can message enquiries about music. The last feature is users can create their own playlist and share the their favorite music into social media.

SEARCH ENGINE

PERSONAL ASSISTANT MUSIC BUDDY

CUSTOMIZE VIDEO PLAYLIST

COMPETITVE STRATEGY LOWER COST

BROAD TARGET

NARROW TARGET

DIFFERENTIATION

COST LEADERSHIP

DIFFERENTIATION

COST FOCUS

DIFFERENTIATION FOCUS

Generic competitive strategy (Johnson et al, 2011)

Using competitive strategy proposes by Michael Porter (Johnson et al, (2011) to understand how Leaf. fm achieves competitive strategy as their main business execution, it shows that company try to use cost leadership strategy by offer a free application (no subscription) for users,

however in the future company will trying to get revenues from the concert ticket been sold through app or through merchandise within the app (Kahn, 2016)

PRODUCT/SERVICES EXISTING

NEW PRODUCT AND SERVIICES

NEW

MARKETS

EXISTING

MARKET PENETRATION

NEW

MARKET DEVELOPMENT

CONGLOMERENCE DIVERSIFICATION

Strategy Direciton (Ansoff Metrix (Johnson et al, 2011)

CONGLOMERATE DIVERSIFICATION Leaf.fm also provide ‘Leafy music sticker’ available on ITunes store where customers can use sticker for iMessages (mobile app released by Apple) or replace sticker on photograph. The product range could be called ‘conglomerate diversification’ propose by Johnson (2011) on strategic direction where company offer product that is not related to existed business.

SOCIAL MEDIA CHANNEL The company distributes news and update through social media channel; Facebook and Twitter. Currently, 15,249 of people is like for Facebook page and 44,800 followers are follow the Leaf.fm account in Twitter.

INVESTOR In August 2016, Leaf.fm had received £450,000 funding from Northstar Ventures and other angel investors such as Doug Scott’s (UK syndicate) The company profile can persuade Wesley Hartley, an investment analyst who used to work at Northstar Ventures, to come to join the company as he believe in company’s future (Kahn, 2016)

According to the interview session conducted by the researcher, Gilbert Corrales, CEO said the company has few criteria of choosing the right investors. Mainly the investor who shares the same vision will be the right investor of the company. To maintain the relationship with investors, the company tries to contact the investor often and let them feel to be as part of a business journey.

STARTUP COMMUNITIES Campus North serves as a startup community in the North East of England, base in Newcastle Upon Tyne. The community partner with several organizations such as Virgin Money, Tech North, and Sage. It provides some digital showcase and held monthly events. (Campus North). According to CEO from interview session, the CEO said the community is still ‘nascent’ and suggest that the community could increase the relationship between academia and startup.

Leaf.fm STRENGTH

WEAKNESS

+ High acquisition of users download in Latin America + High market positioning by offers main service different form competitors (provide music videos from YouTube) + Good profile of company that could attract the investors

+ Product issues complaint by customers such as low buffering of video etc.

CONCLUSION

OPPORTUNITIES

THREAT

+ Support from investors and startup communities + Ability to create viable options for product development and improve internal environment

+ The high competitive rivalry of music streaming industry. + The uncertainty of copyrights regulations which could has been changed in the future.

Using SWOT analysis (Johnson et al, 2011) to identify the strategic options of Leaf.fm. By looking overall results, it could conclude that the company has opportunities to create viable options for future business development.

WHERE DO WE WANT TO BE? Future Direction 1 Future Direction 2 Future Direction 3 Three Horizon Frameworks Future Direction 4 Conclusion

FUTURE DIRECTION 1 Global music platform

According to CEO, Gilbert Corrales, long-term vision of the company is to be a platform that connects artist and music fans by helping artist to connect with their fans more effectively. (Kahn, 2016) Additional suggestion from researcher is when the company becomes a worldwide uses app, it can be

a global music application that concern with different geographic and culture. For example, a company could provide playlists that connect with different festivals and celebrations such as Holi Festival (India), Oktoberfest (Germany)

Market of artists and fans

New market that demand music from different perspective

FUTURE DIRECTION 2 Searching for new market

Leaf.fm could search for a new market by using blue ocean strategy (proposes by Johnson et al (2011), Blue ocean strategy is used to create new demand/market) As the current business focus on music fans demand market, the company could search further on markets that need to use music or how can music deliver new service apart from artist and fans relationship.

TECHNOLOGY

RADICAL CHANGE

TECHNOLOGY EPIPHANY

TECHNOLOGY DRIVEN INNOVATION

FUTURE DIRECTION 3 Adopting design-driven innovation as another company’s vision

vides new meaning of things by offer an unexpected experience of product/services that consumers are not aware of but they are waiting for.

Therefore, the student suggests that company could adopt design-driven innovation concept as their longterm goal. The key is to find ‘technology epiphany’ which is the overlap of using technology driven innovation and design-driven innovation. Technology epiphany is where the market leader celebrates its position.

Design-Driven innovation for bargain the power of five forces: With the high power of radical innovation, the competitive advantage could reduce the five-tension forces surround the company. The innovation could attract the investor to invest with the company, attract more bigger music corporation to engage.

The competitive advantage could attract worldwide users, and hardly for any competitors or substitute to compete and replace.

Why Design-Driven Innovation?

Verganti (2009) explains that deThe interplay between technology-push sign-driven innovation create radical and design-driven innovation(Verganti, 2009) change where radical innovation is the major sources of long-term competitive advantage. Example like the Apple IPod, Nintendo Wii, these sucAs the company’s driving force is However, Verganti (2009) explains us- cessful products are results of using market centric approach (discussed ing market-driven innovation would design-driven innovation to create in the previous chapter of company’s result as an incremental change but new meanings and offer unexpected vision and value) and using the tech- to create radical change is to use as experience that people are waiting nology-driven innovation (disruptive) innovation called ‘design-driven in- and most important, own the strong as their main strategic execution. novation’, an innovation that pro- business competitive.

Design-Driven innovation as a competitive strategy: The innovation could serve as a differentiation strategy where it add premium value to company product, together with using low cost strategy that company is currently use. For example, in the future the company could provide free app uses but offer premium service where consumers can choose weather they want to upgrade or not and the company could monetize from that upgrade.

INCREMENTAL CHANGE

DESIGN DRIVEN INNOVATION

MARKET DRIVEN INNOVATION

INCREMENTAL CHANGE

RADICAL CHANGE MEANING

DESIGN- DRIVEN INNOVATION

BLUE OCEAN STRATEGY

HORIZON 3 EXPLORE VIABLE OPTIONS (FINDING TECHNOLOGY EPIPHANY) 10%

MARKET/TECHNOLOGY DRIVEN INNOVATION

HORIZON 2 OFFERS NEW MARKET 20%

HORIZON 1 IMPROVE EXISTING MARKET 70%

THREE HORIZONS FRAMEWORK FOR INNOVATION Johnson et al (2011) explain organization should consider their business activities through three horizons framework in order to understand the long-term perspective of strategy. Leaf.fm could position itself in horizon 1 (where business is defending its core) and about to shifting to horizon 2 (business offers new activities to increase profit) and horizon 3 (business is dealing with uncertainty by looking for viable options through researching and developing). As discussed recently, adopting design-driven innovation could align in horizon 3 but Verganti (2009) argues that design-driven in-

novation would use time and risk. Therefore organization could manage the innovation strategy by divide the effort into each horizon in a different amount. For example, Google manage their ratio into 70:20:10 for H1, H2, H3 (Satell, 2012) For Leaf.fm cases, the company could manage into 70% on horizon 1 (market/technology driven innovation) 20% on horizon 2 (searching for new market using blue ocean strategy) and 10% on horizon 3 (design-driven innovation).

EXPERIENCE ECONOMY

KNOWLEDGE ECONOMY

+ FUTURE DIRECTION 4

Guardian et al (2014) describe economic change through 4 paradigm shift; the industrial/experience/knowledge/transformation economy. Without consider the paradigm changes, a company with old mindset might face challenges. Therefore it is advisable to keep up through changes. Leaf.fm is most likely to exist in paradigm 2; ‘The Experience Economy’, where using user-centric approach and brand strategy. The company could adopt innovation from Paradigm 3; The Knowledge Economy, where company more connect with users and allow users to share knowledge through online communities. The advantage of using this open innovation is it makes product more effective as the issues and opportunities are been identify earlier from users. Together with combining approach between knowledge economy and experience economy, could bring a competitive advantage to Leaf. fm.

Fulfil experience economy with knowledge economy

CONCLUSION

The future direction of Leaf.fm is to become the music platform and use design process of both experience economy and knowledge economy to drive the company. Leaf.fm could manage their innovation portfolio by aligning innovation through three horizon framework and put in a different amount of investment in each horizon. 70% for improving existed market by using market/technology driven innovation, 20% for searching new market through blue ocean strategy and 10% for searching technology epiphany by use design-driven innovation.

NOW

FUTURE

KNOWLEDGE ECONOMY EXPERIENCE ECONOMY MARKET-DRIVEN INNOVATION & TECHNOLOGY-DRIVEN INNOVATION (70 %)

Future direction of Leaf.fm

DESIGN-DRIVEN INNOVATION (10%) BLUE OCEAN STRATEGY (20%)

TECHNOLOGY EPIPHANY

Combining Approach Enhance Collaborative Action Balancing Left & Right Brain Expand Strategic Direction Product Development (Recommendation) Launching Online Community Content Development Implementation (short/medium/long term) Conclusion

HOW DO WE GET THERE?

COMBINING APPROACHES 1 DESIGN THINKING HUMEN-CENTERED APPROACH

LEARN REPORTING/ POST MORTEM

1. Tool for market/ technology-driven innovation As design innovation consultant, Larry Philip Monster, had said startup that adopting various tools would more likely to succeed and the lean strategy would effective when is proceed together with design thinking and proper research (Sereratana, 2017), a suggestion for the company is to integrate design thinking into lean strategy or the company current innovation tool (mentioned In execution section) As shown in figure 1, the additional feature of the lean cycle is

2. Tool for design-driven innovation model Verganti (2009) has proposed the design-driven innovation process that PREPARATION/ HYPOTHSES consists of three steps; listen, interpret and address. While user-centric approach focuses on around users, the design-driven innovation is to EXECUTION make a discussion about design (design discourse). The process could be explained through the list below: 1. Listening: access to knowledge TEST about how the product could come up with the new meaning.

2.Interpreting: to generate team’s adding design thinking within vision of radical new meaning which ideation stage. Why we have to use requires integrating the knowledge design thinking? Design thinking is from the design discourse essential for creating ideas, as it is open the mindset of the team and encourage curiosity and let the team discover opportunities by using human-centered approach to identify human needs for business competitive. (Verschoor, 2015) As company’s driving force is market-centric, design thinking would be an innovation tool LEARN that would align with the company’s vision and help Leaf.fm able to identiREPORTING/ fy user’s needs.

POST MORTEM

3. Addressing: define the most appropriate meaning and internalize the proposal. As design-driven innovation could be risky as it does not use usual user-centric approach and offer something entirely new. Therefore the company could combine the design-driven innovation with a lean strategy to validate the new meaning by creating minimum viable product and test to people.

LISTENING INTERPRETING

ADDRESSING

PREPARATION/ HYPOTHSES

EXECUTION

TEST

COMBINING APPROACHES 2 Using design thinking in blue ocean strategy

VALUE CREATION

BLUE OCEN THINKING PERSPEVTIVE

DESIGN THINKING : UNDERSTAND UNRECOGNIZABLE CONSUMER NEEDS

VALUE CREATION

VALUE CREATION

As discussed in previous topics that design thinking allows company to explore opportunities for business competitive (Verschoor, 2015), the company could align design thinking within blue ocean strategy. Brown also (2009) explains design thinking helps practitioner to observe unrecognizable demand of consumers. Therefore integrate design thinking within blue ocean strategy would help company to identify the value creation/new demand and market.

COLLABORATION CREATE COLLABORATION CONTRACT

CHIEF TECHNOLOGY OFFICER

FOCUS ON CUSTOMER LET STAFF PLAY&BE CREATIVE

HEAD OF ARTIST & SERVICES

CHIEF OPERATING OFFICER & FINANCE DIRECTOR

CEO

CHALLENGING FOR BETTER SUPPORT GROUP PROCESS

COLLABORATION CONTRACT

HEAD OF GROWTH

HEAD OF CONTENT & COMMUNITY

SUPPORT PERSONAL/GROUP EMPOWERMENT & SELF-ACTUALIZATION

PRODUCT

ENHANCE COLLABORATIVE ACTION As discussed in the previous chapter that Leaf.fm is most likely to expressed as participation-oriented culture and authenticity-oriented culture, the team could align design process into company’s culture according to Lockwood’s (2016) literature of input design within a corporate culture. The company could use customer-centric approach and allow team members to explore and be creative. The key is to support group process/group empowerment and self-actualization.

However, the team could maintain the challenging environment as the company also have minor express of expertise-oriented culture.

in the team to identify possibilities of plans. Then let all team members make commitment to the contract.

This could be another tool that Leaf. fm could apply into their collaboraIn addition, according to Ashkenas tion process.

(2015), the company could create a collaboration contract which is a contract that enhances collaborative capabilities. The method is the team has to create a framework indicate of activities of tasks and time need to be consuming then inform members

BALANCING LEFT & RIGHT BRAIN

+ ANALYTICAL THINKING Osterwalder (2010) explains visual thinking could help a team to understand more on business model by using post-it note/sketching or using future scenario. Leaf.fm could adopt this thinking into their process especially for the head of growth who needs to analyze the market and help the company to grow. The team could balance between analytical thinking

DESIGN TECHNIQUE The design techniques could be the tool to help when team using design-driven innovation or market/technology driven innovation. According to Osterwalder (2010), the power of design tools and attitude could lead a business to success.

PRODUCT/SERVICES EXISTING

NEW

MARKET DEVELOPMENT

NEW PLAYLIST FOR NEW MARKETS

NEW PRODUCT AND SERVIICES

PRODUCT DEVELOPMENT & MUSIC INNOVATION

CURRENT MUSIC APP

MARKETS

EXISTING

MARKET PENETRATION

NEW

CONGLOMERENCE DIVERSIFICATION

LEAF MUSIC STICKER

Generic competitive strategy (Johnson et al, 2011)

EXPAND STRATEGIC DIRECTIONS Using Ansoff Metrix (Johnson et al, 2011) to provide strategic options for Leaf.fm. Currently, the company already have existing music app penetrating in existing market and Leafy music sticker serves as a conglomerate diversification option.

Therefore the researcher expands another option throughout the matrix because with all options been considered would give a competitive advantage.

The new strategic direction for the company is focus in app development and offer a new playlist for a new market (according to the diagram, the new directions are those been circled) which all new features will discuss in next sections.

APPLYING APPROACH FOR PRODUCT DEVELOPMENT Using design thinking in market-driven innovation

Using design thinking for suggesting execution for Leaf.fm, the student had explored around music fans’ behavior by creating a mind map and create a survey explored consumer’s behavior on music experience to identified insights. 46 respondents of both male and female participated in this survey. The respondents were mostly between 19-25 and were students and came from Thailand and United Kingdom. (See surveys questions and results in appendices)

USERS

MIND MAPPING

SURVEY

ADDING LYRIC FEATURE Product development 1

LYRIC FEATURE

KARAOKE MODE

According to survey from the researcher, 93.5% of participants want to know the lyric of the song they are listening to. This could be an opportunity for company to add lyric feature where in future could develop into karaoke mode.

PROVIDE MUSIC SEARCH ENGINE Product development 2

AUDI O

FI LT ER

AUDI O

FI LT ER

AR TIST TA P AND HOLD

GENDER

TO RECORD VOIC

COUNTR Y

E

BAND ALBU M

RECORD

TITL E LYRICS

SEARCH

With more filter to provide searching optimization

SEARCH

Using audio search which customer could sing or scan from surroundings

The survey from researcher shown that 97.8% of participants try to search for the song without know the name of the song while 95.7% try to recall the song and artist from their memories although hardly to remember the name of song/artist.

The review could show one of music fans behavior is involving with searching for music. Therefore the company could provide functional feature to serve this behavior by provide search engine consists of filter search and audio search.

EXPANDING & REARRANGE MOOD

Rearrange the playlist into categories for customer to search more easily. Meanwhile adding more playlist to create more options for customer to discover music. The playlist highlighted in green are the new playlist apart from the current ones.

Product development 3 COUNTRIES

WORKOUT

MIND FOCUS

SLEEP

VACATION

Hecho En Colombia Hecho En Costa Rica Hecho En Ecuador Hecho En Espana Hecho En Mexico Hecho En Venezuela Made in Brazil Made in Canada Made in France Made in Philippines Made in UK

Running Boxing Bump & Grind Skate Aerobic Dance Yoga Belly Dancing Salsa Club Rock motivation Workout Challenge

Study Workaholics Studio Track Collaborate Creative Inspire Office Concentration On Focus Brain Boosting Positive Mind Classical Passion

Smooth Dreams Meditation Mindfulness Sound of Nature Acoustic guitar Piano Celtic Dreams Streams & rainfall Orchestra

Beach Vibes Inspiring Road trip The Train Journey Bon Voyage Motorcycle Diaries Young & Wild

EMOTIONS

COOKING

PARTY

SOUNDTRACK

Haters Gonna Hates Forever Alone Pride Passion Love Song of happiness Like a boss It’s a sad and beautiful world Music Parodies Sweet Serenade Music from The Dark

Indie Cuisine Alternative Kitchen Sweet Bakery Weekend Cooking

Wedding Party Saturday nights out Hit the dance floor Sassy Nights Beach Paradise Underground Anthem Friday Party Dance All Night

James Bond Theme song Disney Soundtracks Musical Oscar Awards Bollywood

MORNING Shower Wake Up Sunrise Scene Morning Motivation

SPORTS FIFA Soundtracks NBA 2K Soundtracks Super Bowl

RELAX Smooth Tunes Coffee House Weekend Track Peaceful Park In the Garden Sunday Chill Chill Sunset

HITS One hits wonder Iconic videos Top songs 2013, 2014, 2015 Billion Views Club XXL Freshman Class 2015,2016 GREATEST OLDIES 80’s cult 40’s, 50’s 60’s, 70’s, 80’s

ANIMATION

ELECTRIC SHADE

CONCEPTUAL

LANDSCAPE

INTRODUCE MUSIC VIDEO GENRE Shuffle the video playlist

Product development 4

Another categorize of music playlist is to base from the style of music video. As Leaf.fm is mainly to serve music videos to music fans, a core feature that differentiated itself from competitor such as Spotify (focus on introduce playlist according to mood of people) or Soundcloud (sharing DJ playlist) (Kahn, 2016), the new genre would help Leaf.fm to have more clear direction from other competitors. Examples of video genre such as music video in animation, or with a landscape scene, or more using with electric light. The video genre could appear randomly everyday

PROVIDE LATEST NEWS FROM FAVORITE ARTISTS Product development 5

54.3 % of participants said they want to receive latest news/events from their favorite artist while 32.6% said they might want to receive. Therefore we could test by provide news option for customers.

AL T-J

To p

All

24 April 201

Stor e

Update

7

Pleased to announce we will be playing BBC R adio 1's Big W eekend in Hull (See full link ...)

2 April 2017 Pleased to announce we will be playing BBC R adio 1's Big W eekend in Hull (See full link ...)

Customers could follow their favorite artists and receive the latest news such as concert, event or latest album release by include in the ‘update’ menu. Customers could click follow to receive notification from artists they choose. In the future there could be buying activities through music apps such as purchase concert ticket or artist product.

MUSIC INNOVATION

Product development 6

Connecting app with Google map to follow user’s move and inform when they pass risk zone

+

+ Future direction for company when it is transform into bigger organization could be more invests in music innovation that would assist peoples’ lives. For example, the company could come up with the ‘safe mode’

feature which suitable for customers who use headphones while travelling. By verify users’ location with Google Maps, the app could inform users when they pass risk zone such as crossing roads.

DISCOVER NEW PLAYLIST Playlist for store (market development)

By using blue ocean strategy (Johnson et al, 2011) to find new demand/market from existed market. Apart from music fans who are engage in music. There could be another segment that use music for other purpose. As shops are open music, another category is playlist for stores where users can select playlist that relevant to their business. However, this is just a suggestion for the company which still need to validate and test.

LAUNCH ONLINE COMMUNITY Complement with knowledge economy and prepare for design-driven innovation

Interpreting

CHIEF TECHNOLOGY OFFICER HEAD OF ARTIST & SERVICES

CHIEF OPERATING OFFICER & FINANCE DIRECTOR

CEO HEAD OF GROWTH

HEAD OF CONTENT & COMMUNITY

PRODUCT

To complement the experience economy with the knowledge economy, another suggestion is to launch online community where users can share their knowledge/ content about music or address product issues. Additionally, the company could use the content shared by users to interpret the new radical meaning for searching the technology epiphany. The online community could be a door that leads to design-driven action in long term.

APPLYING APPROACH FOR CONTENT DEVELOPMENT Using content strategy canvas

Using content strategy proposes by Lake (2016) to create more effective content, the content aims for millennial who have a high engagement in cloud base music and social media. By consider the value/benefit that customers would receive, the company could publish a content more focus on the lifestyle of music fans or content that present in a playful tone.

EXAMPLES OF CONTENT

The content could surround around music lifestyle of consumers. The key is to offers content that customers want so that they would share within social media and it becomes another channel distribution of the company.

Caption: “How’s your weekend?

Bruno Mars or Ed Shareen”

It could speak in the same language to customers; act as music buddy, present in a concise playful tone.

IMPLEMENTATION

NOW 1-2 months

FUTURE 1 year

2 years

More than 3 years

LONG TERM MEDUIM TERM SHORT TERM

MARKET/TECHNOLOGY DRIVEN INNOVATION (70%)

DESIGN-DRIVEN INNOVATION (10%)

TECHNOLOGY EPIPHANY

BLUE OCEAN STRATEGY (20%)

KNOWLEDGE ECONOMY EXPERIENCE ECONOMY

All implementations as been discussed could align pand playlist to create varieties options. into short/medium/long term.

5. Expand playlist for store or expand new market (Market Development) Short term: 1-2 months Other improvement: Improve internal environment 6. Improve content: deliver content with more in 1. Combining approaches: integrate design think- depth of music lifestyle to consumer and present ing and design-driven innovation within lean strat- in more playful tone. egy, input design thinking with blue ocean strategy 2. Enhance collaborative action: by align design Medium term: 1 year into corporate culture and create collaboration Product development: contract 1. Introduce music video genre: offer another new 3. Integrate analytical thinking with design tech- playlist base on the style/art direction of music vidnique: using post-t note/sketching/ future scenario eo. to understand/interpret consumers, economic and 2. Adding lyric feature: sociocultural change.

3. Provide music search engine: with more filter Product development search 4. Expanding and rearrange mood: rearrange the Other improvement: playlist into categories for easily searching and ex- 4. Launch online community: prepare for knowl-

edge economy and for design-driven innovation.

Starting to search for technology epiphany, which could expand to long term depends on work progress of team Long term: 2 years: Product development: 1. Develop search engine: provide with voice scan feature 2. Provide latest news from favorite artists and input ticket buying channel and merchandise within app.

More than 3 years: 1. Music innovation: providing safe mode feature 2. Continue to search for technology epiphany or if find one, proceed through lean cycle; execute, test, learn and repeat.

LEAF.FM CORE STRATEGIC

CONCLUSION

Design thinking for pushing the innovation’s territory DESIGN DRIVEN INNOVATION

BLUE OCEN STRATEGY

MARKET/ TECHNOLOGY DRIVEN INNOVATION

DESIGN THINKING

In conclusion, Leaf.fm could align design thinking as their core strategy for driving innovations as discussed in previous sections.

Brown (2009) has raised an important of how design thinking contributes to organizations; using empathy to understand other people’s lives, converting need into demand, seeking of hidden needs. It could conclude that design thinking standpoints for the root of innovation as innovation all surround through human’s demand, from innovation that improving the existed market to the breakthrough that shapes the future. The value of design is tremendous that welcome all business to use and make sense of it.