Why Joe Rogan Isn’t Spotify’s Biggest Problem

Spotify is going down, but not because of Joe Rogan.

By Tori Marchiony

Much ado has recently been made about the decisions by Neil Young, Joni Mitchell, and other musicians to remove their song catalogs from Spotify in protest of the company’s continued platforming of polarizing podcaster Joe Rogan. What started as a controversy about Rogan’s spread of COVID misinformation quickly snowballed into a full-blown audit of “The Joe Rogan Experience,” and as of this writing more than 100 episodes have been removed for including false claims and/or the “n-word.”

Daniel Ek, Spotify’s CEO has denounced Rogan’s use of the slur, writing, “Not only are some of Joe Rogan’s comments incredibly hurtful — I want to make clear that they do not represent the values of this company.” Yet Spotify has not given up on the $100 million investment it made in Rogan and his 11 million weekly listeners, even as the company’s valuation decreased by $2 billion in the immediate aftermath of Neil Young’s departure.

Maybe Ek understands that the users who say they’ll unsubscribe (about 19 percent of its member base, according to a Forrester Research poll) likely won’t follow through. Or, maybe he understands that while this whole “Rogan situation” is certainly a lightning rod for outrage, Spotify’s faces a bigger threat to its brand.

Cancellations only really stick when a brand has violated its own core values and betrayed the customers with whom it had forged a connection over shared beliefs.

Plenty of other brands have weathered similar storms. In the age of cancel culture and rampant “keyboard slacktivism,” members of the public are enjoying an unprecedented ability to incite boycotts over transgressions large and small — a fact exacerbated by the fact that two-thirds of consumers now buy based on their beliefs. At a time when many people are feeling disillusioned with politics, buying and boycotting have become meaningful expressions of personal values. More than ever, economic transactions are driven by trust and attachment between a company and its customers, built on shared values. Therefore, making sure that a company’s values are clearly stated is essential to keep customers engaged.

But telling a brand story that merely sounds good isn’t enough — the brand must actually “walk its talk” and align all its actions with those values in order to maintain (and continue to capitalize on) that trust. When deployed properly, a brand’s story should offer the company a clear path through day-to-day operations as well as periods of growth and turmoil alike.

The brands that have most successfully navigated avalanches of hate tweets to #cancel them are the ones that had a clear set of core values in place to guide them through. On the flip side, the most successful cancellation campaigns have targeted companies that violated their own stated values. Being exposed for hypocrisy made the necessary next steps incredibly clear.

One brand that followed its core values through public pressure and emerged triumphant on the other side is Nike. In 2018, it was not an act of change, but a refusal to change that deepened public trust in the company’s commitment to its values. After Colin Kaepernick, the NFL quarterback who protested police brutality by kneeling during the national anthem, was featured in a Nike ad campaign with the slogan, “Believe in something. Even if it means sacrificing everything. Just do it,” many people felt betrayed. Those who saw Kaepernick and, by extension, Nike, as speaking against their values furiously took to Twitter with performative acts of destroying their Nike gear. The brand saw a four percent ($3.75B) loss in market cap in the days following the campaign’s premiere. Then-President Trump even weighed in, saying, “I think it’s a terrible message that they’re sending.”

But Nike held fast. After all, both their mission “to bring inspiration and innovation to every athlete in the world” and purpose “to move the world forward through the power of sport — breaking barriers and building community to change the game for all,” are perfectly aligned with the decision to endorse Kaepernick. Kaepernick embodies an athlete breaking barriers, who put his own career on the line in service of changing the game for all, and whose actions meaningfully inspired athletes all over the world. Nike ended that fiscal quarter with a 10 percent increase in revenue and six billion additional dollars of market value. For Nike, acting on its values pays off.

Consider, too, the evolution of Gucci’s stance on fur. For decades, the brand simply ignored mountains of criticism from PETA and other activists who routinely protested at its runway shows, outside its brick-and-mortar stores, and on social media. Protestors implored the luxury fashion house to stop supporting the fur industry. But Gucci also realized that its younger customers were approaching the brand with higher ethical expectations and that its priorities must also evolve if it wanted to stay relevant to purpose-led fashion shoppers.

In 2004, it became one of the first high fashion companies to commit to Corporate Social Responsibility, outlining a new policy that suddenly cast its stance on fur in a whole new light. Its new CSR policies assessed its reliance on fur to be brutal, cruel, and increasingly unnecessary. Fur was no longer aligned with the brand, despite its history. Now promising to identify and assess “both direct and indirect social and economic environmental impact along the entire supply chain and promoting within its own spheres of influence actions for the improvement and development of support for people and their environment,” the brand’s next steps were clear. In 2017, the company announced that it would ban fur from its Spring 2018 collection, and every one from then on. The brand’s remaining animal fur items were sold at auction, with proceeds donated to the Humane Society and the Italian animal rights organization LAV.

“Being socially responsible is one of Gucci’s core values, and we will continue to strive to do better for the environment and animals,” said Marco Bizzari, the Italian firm’s president and CEO. Today, Gucci fashions remain foundational status symbols for hype beasts and middle-aged moms alike, in part because Gucci managed its reaction to protest according to its brand story and the values that define that story.

And this is why Spotify is actually in trouble.

If editorial oversight was truly the core issue, Spotify would now be racing its competitors to develop a rigorous set of standards to protect against future hate speech and misinformation. Instead, the platform is implementing COVID-19 content warnings and leaning into vague language like, “We will also begin testing ways to highlight our [existing] Platform Rules in our creator and publisher tools to raise awareness around what’s acceptable and help creators understand their accountability for the content they post.”

This mild response to the Rogan backlash reflects Spotify’s understanding that a great number of those who have threatened to abandon the platform will not follow through. Part of the reason for this is the lack of a viable alternative. As Jon Stewart recently pointed out, just about every media platform likely houses a program or broadcaster with similar views to Rogan: “Sometimes those grand gestures of, I’m removing myself, doesn’t necessarily take into account, like, you’re on Comcast […] or Time Warner. You’re on any cable station, right? They’ve got Fox News on. You’re telling me Fox News isn’t a willful purveyor of misinformation? Dishonest to its core. So now everybody on TV has to pull out of their fucking shows or de-platform because in the same tube that you exist, they exist?”

But the impact of inertia should not be underestimated. “One reason is consumers’ habitual nature,” wrote Brayden King for the Institute for Policy Research at Northwestern University. “Even people who publicly denounce a company might still purchase that company’s products. Plus, the people boycotting a company might not be its target consumers.”

The truth is, Joe Rogan is not a substantial threat to Spotify’s existence. While many see his behavior as undesirable, keeping him in the fold doesn’t go against any of Spotify’s stated values. After all, it never promised to screen or censor any of the content Rogan (or any of the artists on its service) has been lambasted for sharing. But if musicians like Young and Mitchell were to rally boycotters around an issue that does reveal a fundamental hypocrisy, it stands to lose far more. And, unfortunately for Spotify, this issue is has already been bubbling below the surface for some time.

Spotify has been out of step with its most fundamental values for years. Its mission is, “to unlock the potential of human creativity — by giving a million creative artists the opportunity to live off their art and billions of fans the opportunity to enjoy and be inspired by it.” Yet the measly payouts Spotify offers its artists per stream means that it has become nearly impossible for creators without celebrity status to make enough money to survive. “Spotify, Apple Music and most other major platforms use a so-called pro rata system of royalty distribution,” Ben Sisario explained in the New York Times. “In this model, all the money collected from subscribers or ads for a given month goes into a single pot, which is then divided by the total number of streams. If, say, Drake had five percent of all streams that month, he (and the companies that handle his music) get five percent of the pot — meaning that, effectively, he gets five percent of each user’s money, even those who have never listened to his music.” At the other end of the spectrum are artists like Kyle Reid, who has five albums on the platform and around 50 monthly listeners, which earned him $8.39 over the course of two years.

The misalignment of so grotesquely stacking the deck against the little guy and then claiming to offer creative people the “opportunity” to “live off their art,” has long been the real poison in Spotify’s well. Ever since the streaming service came to the U.S. in 2011, musicians have been “raising alarms about the fractions of a penny they received for each click.” In March 2021, The Union of Musicians and Allied Workers organized a slate of coordinated demonstrations at Spotify offices across the globe, calling for “increased transparency in the company’s business practices, an end to lawsuits filed against artists, and a user-centric payment model that pays a cent per stream, among other things.” Spotify’s director of economics responded by claiming that employing a user-centric payment model would inflate Spotify’s administrative costs so severely that it would cancel out any potential revenue gains for less-popular artists.

The company’s actions in the wake of the fallout from Rogan’s attempted cancellation reflect its understanding of the problem with this hypocrisy. Spotify CEO Daniel Ek pledged to match the company’s investment in Rogan with another $100 million– earmarked for “licensing, developing, and marketing music and other audio content by creators from historically marginalized groups.” A step in the right direction, maybe, but certainly not a surefooted move indicating meaningful progress towards alignment with its values. Every day that Spotify fails to live up to its brand story, the more customer trust will erode, allowing other streaming platforms to gain more ground in the market.

A brand story should function as a company’s North Star — lighting a clear path to safety through even the darkest night, past the most irate Twitter mob, and reliably forward. The moment a brand abandons its values, it risks losing trust — the single most valuable connection it can build with any customer.

Spotify now has two options. It can change its values to align with its behavior, accepting that paying lip service to any cause is just as counterproductive as disavowing it. Or, it can realign its actions with its existing brand story — the one that claims Spotify exists to connect listeners and artists, and to give artists a livelihood. If it insists on remaining in the in-between, it will continue to disappoint and alienate customers and artists alike, until the ship sinks for good.

Tori is a brand storyteller at Woden. Want to stay connected? Read our extensive guide on how to craft your organization’s narrative, or send us an email at connect@wodenworks.com to discuss whatever your storytelling needs may be.

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