I was delighted the other week when Spotify finally launched in Ireland and immediately signed up to see what all the fuss was about. I buy a lot of music and have never been a big fan of streaming, always preferring to buy a CD or download but after having used Spotify pretty much non-stop for a couple of weeks, I admit I’m warming to the idea of streaming. Although I found myself using Spotify a huge amount, when it came to buying the music I was listening to, I went back to iTunes to make the purchase. Even though I discovered (and sampled) the ‘product’ through Spotify, I went back to the old reliable to actually part with my cash.
This hit home how big an advantage it is for a company to have an established footing in the online world. iTunes already have a huge user base in Ireland and have turned themselves into a frequent use product and this gives them a significant edge in the music space. When it comes to making purchases online or on mobile, people are lazy and don’t want to continuously set up new accounts. This is true for many aspects of the online world.
I think the convenience of using a service online that you’re already familiar with is a particularly big barrier to any new service on the net and, as Dave McClure points out, the key to success in payment systems is with frequent-use products. With companies like Apple, Google, Facebook, etc. quickly becoming the go-to-guys of the web, they are in a powerful position when it comes to leveraging their users into customers whether that be online or offline via mobile.