The music industry has gone from selling $20 albums to $0.99 songs to now selling unlimited subscriptions for $9.99 per month. Eventually, all software is moving to the SaaS business model and music streaming services can be a good reference model going forward in at least the following 3 areas:

#1: ‘All you can eat’ pricing is very attractive to customers and will eventually result in higher revenue. Apple iTunes made $1B in 3 years and $10B in 7 years by selling individual songs. Apple Music is generating more than $5B/Year in just 5 years after launch. 

#2: App developers on the SaaS platform will find creative ways to generate more revenues. Artists get paid an average of $0.006/stream on music streaming services compared to $0.09/song download on iTunes. This has resulted in artists creating songs that are short-length and generate more streams. The average length of a song these days is 3 min 30 secs and lots of hit songs are less than 2 min 30 seconds long. 

#3: Analytics can be used to generate a better customer experience and new revenue streams. Users can listen to new music and show their preferences by just skipping songs. Artists can collaborate on new songs based on their unique fan base and generate additional revenues. ‘Old Town Road’ is a perfect example that captured both country and rap music audiences.

Conclusion: SaaS vendors can borrow marketing strategies from the music industry to lead the change in their respective industries.