Building One with Tomer Cohen

Episode 4: More Questions with Gustav Söderström

Release Date: July 16, 2024
Host: Tomer Cohen, Chief Product Officer at LinkedIn
Guest: Gustav Söderström, Co-President of Spotify

In the fourth episode of Building One with Tomer Cohen, Tomer engages in an insightful conversation with Gustav Söderström, the Co-President of Spotify. Building on their previous deep dive, this episode uncovers additional layers of Gustav's approach to product leadership, strategic thinking, and personal interests that shape his professional journey. The discussion offers valuable lessons for aspiring product leaders and enthusiasts eager to understand the nuances of building impactful products in a competitive landscape.

1. Gustav's Rapid Learning Techniques

At the outset, Tomer probes into Gustav’s methods for acquiring knowledge swiftly and effectively—a crucial skill in the fast-paced tech industry.

Quote:
“One is podcasts and audiobooks and normal books. A lot of fantastic educators on YouTube. And then the trick I do is I sort of abuse my position a little bit and I take some of the smartest people in the company in a certain area, and I get to ask the smartest people questions about AI or marketing or business or something.”
— Gustav Söderström [01:02]

Gustav emphasizes a multi-faceted approach to learning, combining traditional resources like books and audiobooks with leveraging the expertise within his organization. By engaging in one-on-one sessions with subject matter experts, he ensures a deep and practical understanding of complex topics, from artificial intelligence to marketing strategies.

2. Strategic Insights from Competitors

Tomer shifts the conversation to Gustav’s perspective on competitors and how Spotify navigates its strategic landscape.

Quote:
“I tend to focus a lot on competitors to understand kind of what we should not do. I think a risk is that you accidentally step right in the way of a much bigger competitor.”
— Gustav Söderström [02:03]

Gustav discusses his approach to competitor analysis—not to mimic, but to identify pitfalls and strategic positions where Spotify can differentiate itself. He shares how Spotify ventured into the background music niche, avoiding direct competition with YouTube’s foreground on-demand service. This strategic differentiation created a "blue ocean" of opportunity, catering to user behavior that favored background listening.

He further delves into business model learnings from Netflix, praising their strategic reinvention and disciplined focus:

Quote:
“They completely stayed away from that thing. They seem very strategic. Incredible company.”
— Gustav Söderström [04:38]

Gustav admires Netflix’s ability to pivot from DVD rentals to a subscription-based streaming model, highlighting their strategic foresight and disciplined execution as key factors in their sustained success.

3. Unexpected Product Success: The $1 Three-Month Campaign

Exploring product innovation, Tomer asks about a Spotify initiative that initially seemed dubious but turned out to be a game-changer.

Quote:
“I thought it was a terrible idea. I'm like, what is this discount marketing thing? You know, that's not going to work.”
— Gustav Söderström [04:58]

Gustav recounts Spotify’s “three for one” campaign, offering three months of service for $1. Despite initial skepticism, this promotion became widely adopted across the subscription industry. The success lay in balancing customer commitment with perceived value, effectively transitioning users from free to premium tiers.

Quote:
“You get a commitment, you start paying, but there's also enough value that you actually feel you're getting something.”
— Gustav Söderström [05:33]

This strategy not only incentivized sign-ups but also provided ample time for onboarding, ensuring users fully experienced Spotify’s value proposition, thereby increasing conversion rates.

4. A Hypothetical Leap into Physics and the Role of AI in Knowledge Creation

In a lighthearted yet profound segment, Tomer asks Gustav about his dream profession in an alternate universe.

Quote:
“If the other universe also can give me a bit more IQ, I would definitely want to be a physicist.”
— Gustav Söderström [06:05]

Gustav expresses a deep fascination with physics, particularly quantum mechanics and quantum computing. He appreciates the fundamental models and their predictive power, acknowledging the potential of AI to enhance scientific discovery.

The conversation evolves into a discussion on AI’s capability to generate new knowledge:

Quote:
“I think it's entirely possible to create new knowledge. I think it's maybe a little bit overestimated how good we are at it.”
— Gustav Söderström [07:34]

Gustav believes AI technologies, such as reinforcement learning and predictive models like AlphaFold, are already contributing to unprecedented advancements in fields like material science and physics. He envisions AI as a catalyst that will further accelerate innovation and discovery.

Conclusion

The episode wraps up with mutual appreciation between Tomer and Gustav, highlighting the enriching nature of their dialogue.

Quote:
“Tomer, always great speaking to you.”
— Gustav Söderström [08:43]

Gustav Söderström’s insights offer a blend of strategic acumen, innovative thinking, and a passion for learning that underpins his leadership at Spotify. This episode serves as a valuable resource for product leaders and enthusiasts seeking to glean lessons from one of the industry's foremost minds.

Note: This summary excludes non-content sections such as advertisements, intros, and outros referenced at the beginning and end of the transcript.