Question

JOE KENNEDY: Hi. I'm Joe Kennedy. Welcome to Pandora. JOE KENNEDY: Pandora uses the power of the internet to deliver personalized radio. So we all know what radio is, but when radio becomes personal, that means you get to make your own stations. Tell us the name of a favorite band or artist or song, and we'll create a station just for you. And you can either sit back, or you can choose to lean forward and say I like this, or I don't like that, and further refine the station to your taste. Powering it all is the Music Genome Project. For over 10 years, we've had a team of music analysts sitting down listening to music with headphones, one song and a time, analyzing every aspect of the music. The melody, the harmony, the form, the instrumentation, the vocal performance, the production characteristics. So we know the DNA of every song. And that enables us to find great matches and great sequences among songs. That's the underlying intellectual property that enables the magic of Pandora, which really is making radio personal for you. Pandora was going through a tremendous transition, from a business to business model to a consumer model, from licensing music recommendation technology to delivering personalized radio. And to build those connections directly with consumers, it's a whole different mindset in terms of how do we build a consumer audience, put forward a proposition that people will enjoy, that will meet their needs. It's just a full range of things that come into play as a consumer service. So the company was really looking to make that transition as I arrived, with this focal idea of how do we deliver personalized radio. You can think about it in terms of three choices the company had. One, which I consider the more kind of conventional standard marketing approach, thinking in terms of advertising and a media plan, et cetera. Second, with particularly the power of the internet, and the degree to which word of mouth is now frictionless, there's lots of ways to really be smart about establishing word of mouth and having your products spread virally. Then a third thing would be to say, hey, we've got a great product, but maybe we don't really have the wherewithal to do the heavy lifting of connecting with consumers. Maybe we need to sell the company to a larger company that has that capability, or through some major partnership. We decided to focus on word of mouth, and attempt to build the service virally. Again, an easy thing to say, much, much harder to do. You kind of put yourself in the hands of your audience. And it's going to grow kind of at the rate that the audience powers it to grow. Because the nature of word of mouth is it's going to happen a step at a time. And in truth, it's worked out tremendously well. Over a little bit more than five years, we've garnered over 65 million registered users, beyond our wildest dreams. But I think it really illustrates that in today's world, word of mouth is frictionless. There are all these mechanisms for word of mouth. The cornerstone, though, is the product has to absolutely not just satisfy, but delight the consumer. And if that delight is there, that spark is created, then the potential to grow by word of mouth is enormous. Our dream is to have a billion plus people listening to Pandora, enabling them to connect with the music that they love wherever that music was created. The foundation underneath that is also enabling Pandora to be enjoyed on any form of connected device. Not just smartphones, not just iPads and other tablets, but connected cars, connected living rooms. There's actually a refrigerator out there that is internet connected. The entire world is becoming connected, and we want to enable Pandora to be enjoyed wherever and whenever people would listen to music. And that's a huge part of people's lives. I think what's always guided me in terms of the career choices that I've made is I've always focused on things that I had a genuine, deep passion for. I had a sense that there was a cause. If you have passion for what you're doing, then it's a whole lot easier to have that drive to deliver truly the best in the world product or service or whatever it is that you're working on. I'm Joe Kennedy. Thanks for checking out Pandora.

1. Discuss the challenges that Pandora faced by transitioning from B2B to a consumer model.
2. Discuss the three advertising options that Pandora had, which one it chose, and why.
3. What career advice does Joe give in the segment?

Summarize your answers in a Word document that is two-to-three pages in length and double spaced.

Answer 1

Discuss the challenges that Pandora faced by transitioning from B2B to a consumer model.

It had to work on licensing the technology of music recommendation and to deliver personalized radio services that could function on almost all electronic internet enabled devices. It need to go for consumer relation building requiring different perception and marketing approach to launch the value proposition that target consumer feel meets their requirements. The basic challenge was thus selecting the mode and techniques to deliver personalized radio to consumers.

Discuss the three advertising options that Pandora had, which one it chose, and why.

• Traditional marketing: media and advertising etc.
• Viral marketing of products through internet technology and word of mouth
• Partnering with a big company or selling the company to someone who has the capability to market Pandora product personalized radio.

The company selected word of mouth. Its impact is much higher and word of mouth is frictionless. They already had the product that could delight the consumers so it was considered the best technique.

What career advice does Joe give in the segment?

The people should focus on doing things that they are genuinely passionate for. He saw a cause when joined Pandora. Passion helps to sustain the spark and drive to deliver best in product or service one is working on.