Why have we heard so little about Spotify's artist donation links?

By: Cherie Hu

Published: 2020-05-11

The ongoing pandemic has spurred growing interest and investment in direct-to-consumer channels for artists, through which fans can put money into artists’ pockets more quickly than with the standard music-streaming model. Multiple tech platforms in the music industry have tried to claim their stake in this ecosystem, with vastly different levels of success.

Perhaps the most prominent example is Bandcamp, which to date has waived its transaction fees for artists two times: Midnight to midnight PDT on March 20, 2020, followed by midnight to midnight PDT on May 1, 2020.

If you’re like me, you found it impossible not to hear about Bandcamp during these two days. It wasn’t just the artists who were furiously sharing their Bandcamp links. Music fans, both inside and outside the industry, were also flooding my social-media timelines, posting threads of their proud purchases as well as album recommendations for those who remained indecisive.

It felt like a genuinely celebratory moment for music culture — and the numbers proved it. On day one, fans spent $4.3 million on 800,000 pieces of music and merch on the platform, a 15x jump in purchasing activity from a typical Friday. On day two, total spending jumped again by 65%, to $7.1 million. That’s a total of $11.4 million in spending within 48 hours.

Meanwhile, you also had the music-streaming world rolling out native features for fans to support artists directly for the first time in their product history.

On April 2, SoundCloud announced that artists could highlight any donation link of their choice on their profile pages. Spotify followed suit 20 days later with Artist Fundraising Pick, which allows artists to highlight a Venmo, PayPal or Cash App link on their profile pages, either to their personal accounts or to those of their peers or a social cause of their choice. The first 10,000 U.S. and U.K. artists who secured a donation through their Cash App links on Spotify also received an extra $100 donation from Cash App itself, a total commitment of $1 million in additional contributions from the payment company.

What have I heard from Spotify and SoundCloud about the resulting activity and culture around their donation features? Relatively speaking, crickets.

Spotify shared in its Q1 2020 earnings report that around 50,000 artists have enabled the fundraising feature on the profiles so far; the streaming service then reached the 10,000-artist threshold for Cash App giveaways on May 4. SoundCloud has not shared any engagement data around its own donation buttons with the public yet, and neither SoundCloud nor Spotify have disclosed specific earnings data.

What’s more, as far as evangelism from artists — let alone from fans — is concerned, I’ve heard almost nothing about either group of people turning intentionally to Spotify or SoundCloud as the primary channel for direct support. Recent articles in VICE and The Guardian demonstrate that the attitude in the independent-artist community around tipping on Spotify has been less celebratory and more reluctantly accepting at best, seethingly critical at worst.

On the surface, all these new features across Bandcamp, Spotify and SoundCloud lead to the same end result if successful: Fans giving their money to artists and causes, with few financial intermediaries in between.

But more than specific features or outcomes, there’s a huge gap in public perception between the likes of Spotify and Bandcamp, with respect to their roles in direct-to-fan communication and monetization.

To explain, let me first outline what the situation would look like in an ideal, alternate world where these streaming-based fundraising links work: Spotify prioritizes the links in its marketing and product-development efforts. Then artists share their fundraising links with fans, either within Spotify or on their own social accounts. Then fans treat Spotify as one of their preferred ways to contribute directly to artists. This then further incentivizes Spotify to focus on the feature — and the cycle repeats.

Altogether, these steps would comprise a flywheel effect that looks something like this:

Instead, this is what’s really happening:

Every spoke of the flywheel has broken. Spotify has not prioritized Artist Fundraising Pick, as it has a lot of other issues to think about (read: podcasts and profitability). Artists don’t have the means to promote their donation links to fans directly within Spotify. Many artists have also opted not to share their links elsewhere, for a variety of cultural and psychological reasons (more on that later). As a result, Spotify doesn’t come to mind as a resource for these artists’ fans to offer direct support. The lack of activity then de-prioritizes development on Spotify’s side, and so on.

Just because the flywheel is broken doesn’t mean features like Artist Fundraising Pick can’t grow in the future. But the fact of the matter is that all of the parties involved are facing inherent roadblocks in their ability and incentive to make it succeed. Not to mention that removing these roadblocks might require making some deeper, systemic changes in how the music industry works, and especially in how outsiders think about it.

Let’s break down each of these broken spokes.

Streaming music might be the cheapest, most convenient outlet for some fans to support artists right now. But it’s also the least immediate and least direct method of support in terms of revenue impact.

Given that Spotify has artists’ livelihoods at the center of its mission statement — “giving a million creative artists the opportunity to live off their art” — it makes sense that they would launch a feature that enables artists to earn income more directly in the midst of a pandemic, instead of having to wait weeks or months for royalties. In concept, I think it’s a rational move.

But based on the past few weeks, it’s clear that Spotify has put the onus on artists, not on themselves, to actually promote the feature.

As a subscriber, I continually receive push notifications from Spotify about new music releases, or about original podcasts that have nothing to do with my interests or listening habits (grr). I have yet to get an email from Spotify announcing that any of the artists I followed on the platform had posted fundraising links.

The only way I’ve been able to learn which of the artists I follow have activated their links is by checking each of their profiles manually, one by one. This might be fine, given that existing or loyal fans who click through to learn more about artists via their profile pages are the ones who are more likely to donate, anyway. But in general, I think there’s an inherent flaw in putting the burden solely on artists, as they’re unable or often unwilling to do the promotional work themselves — more on that in the next section.

Also, the Spotify fundraising links appear only on mobile, not on desktop. Previous studies have shown that only around 25% of donors complete donations through their mobile devices — implying that Spotify may actually be alienating a significant part of the potential contributor base for music, at least for the time being.

On the artist side, there is both the logistical inability to promote fundraising links within Spotify to the fans who would use them, and then the deliberate unwillingness from many artists to promote the links off-platform.

In part because Spotify is not really prioritizing donations compared to other business activities, there’s no way for artists to reach out to existing fans on the platform and notify them that a fundraising link is now up on their page.

This lack of native communication tools for artists is a feature of Spotify, not a bug, and has historically forced artists and fans to look elsewhere off-platform to keep in touch and build community. As Dave Benton, an artist who performs as Trace Mountains, told VICE: “I’m not very inclined to tell my supporters to go [to Spotify] because I’d rather direct them to my website or Bandcamp page, where I have more control and [can] communicate with them directly if I want.” (Spotify is currently working on some paid advertising tools that might make native artist-fan communication easier — although they are, well, paid.)

Artists’ reasons for not promoting the feature off of Spotify tend to be more personal rather than logistical. For many artists, making an appeal for money feels awkward and challenging, especially amidst a pandemic where many other essential workers are struggling, especially in healthcare. As Nothing frontman Domenic Palermo told VICE: “… I don’t feel comfortable promoting it when there are others who need it more.”

And when framed within the Spotify app, a donation link may get the wrong message across altogether. As The Guardian’s Ben Beaumont-Thomas argued: “The tip jar, while helping to replace lost touring earnings, is a tacit admission that artists are not being paid enough by the very service offering it.”

It doesn’t help that all fundraising picks on Spotify display the blanket label “COVID-19 support” (as pictured at the top of this post), whether the hyperlink leads to an artist-owned account or a third-party nonprofit. This further blurs the line between direct artist support and charitable giving, which may be off-putting for artists who don’t want to come off as a charity case.

This is relatively straightforward: If neither Spotify nor artists promote a new feature on the platform, few fans aside from the most diehard or curious will be motivated to use it, let alone even know about it in the first place. But the quietness around donation links also points to a persistent, systemic branding and education issue around Spotify’s role in the music industry at large.

The way I think about it is, a platform like Bandcamp is in the passion business, while a platform like Spotify is in the commodity business.

Bandcamp’s entire business relies on fans paying for artists’ music, directly from the artists themselves — particularly independent and historically marginalized groups of artists, as exemplified in the editorial focus of the Bandcamp Daily and Weekly properties.

In contrast, as I argued in the past, Spotify may talk about supporting artists, but it’s ultimately in the business of functional audio — i.e. inserting audio into every function of our lives, from waking up, to working during the day, to hanging with friends, to going back to sleep. Under the framework of functional audio, one given song is treated not necessarily as art, but as a fungible commodity that can be interchanged with any other song that serves the immediate purpose at hand. At the end of the day, I would argue Spotify as a service wants to compete more with meditation and wellness apps than with Bandcamp.

As a result, fans associate Spotify more with leanback audio listening than with direct artist support — a connection subconsciously underscored by the lack of promotion from both Spotify and the artists themselves once the native direct.

Of course, listening to audio for a functional purpose doesn’t have to be mutually exclusive from supporting artists directly. I recently posted on Twitter that I think the sections for direct-contribution links on Spotify and SoundCloud should stay up in some form after the pandemic subsides. The alternative — i.e. removing the features and going “back to normal” — would likely reflect badly on those companies.

But under the weight of inaction, something’s got to give.