Leaked Spotify deck reveals how it's trying to compete with TikTok, Instagram, and others for video ads

Core Insights - Spotify is focusing on enhancing its advertising appeal, particularly targeting small- and medium-sized businesses through automated sales and new ad products [2][3] - The company reported its most profitable quarter ever, with a 13% increase in ad sales and a 12% growth in premium subscribers, although ad sales growth has slowed compared to previous quarters [3][4] - Spotify's advertising revenue is projected to be $2.06 billion this year, significantly lower than competitors like Pinterest, Alphabet, and Meta [3] Advertising Strategy - Spotify has launched an in-house ad agency and generative AI ad products to simplify audio ad creation [2] - The company is promoting its video inventory, including video podcasts and music videos, to attract advertisers [2][6] - Spotify's automated and self-service ad offerings are gaining traction, but it still faces challenges in competing for social media video ad dollars [4] Market Position - Advertising constitutes 12% of Spotify's total revenue, with a goal to increase this share to 20% [3] - Despite its efforts, Spotify remains a minor player in the advertising market compared to larger competitors [3] - The company emphasizes its unique position in the audio space, differentiating itself from platforms like Snap and Pinterest [5] User Engagement - A study cited by Spotify indicates that 92% of its users incorporate the platform into their daily routines, providing numerous opportunities for advertisers to reach consumers [5] - Spotify claims its ads outperform TV and social media in metrics such as reach and attention, potentially driving user purchases [5][6]