SPOTIFY : THE EF ECT OF TRIAL EXPERIENCE ON USER’S PURCHASE INTENTION OF PREMIUM SERVICE

• Main Author: Givani, Sherryl
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/63805
• Institution: Institut Teknologi Bandung

The freemium or ‘free’ and ‘premium’ business model has been used since the 1980s, and it is now especially popular among SaaS (Software as a Services) companies and other internet-based companies, including MaaS (Music as a Service) business as an example of Spotify. The free side of this business model has a similar concept to product trial that allows their users to have a first hand experience as to what the product or service has to offer for free. However, businesses will gain their income from the purchase of the premium offers. Hence, it is crucial for these businesses to be able to convert their free users, non paying, into a premium user, paying customers. This study aims to look into the effect of the trial experience into the users’ purchase intention. The proposed model in this study is empirically evaluated using survey data collected from 105 Spotify users with a prior experience of using the free service of Spotify, responding about their perception preceding the experience. This study shows that users’ trial experience when using the free service has an effect on the purchase intention. This effect is positively enhanced with their satisfaction of the experience along with some indicators of personalisation (customised features available for premium version) as well as price value on the premium version.