Why Tidal is Banking on Meek Mill's Success

he streaming service hopes to leverage the Philadelphia rapper’s comeback and convert his fans into loyal subscribers.

When Tidal first announced its promotional offer for Meek Mill’s new album Championships, it sounded like a desperation move. For a mere $3.50, fans can go to Foot Locker and buy a Meek Mill collectors booklet that includes a redeemable code for a six-month trial subscription to Tidal. That’s a $60 value—one of the highest yet for an album bundle. Tidal subscribers also had access to a special pre-sale to buy tickets for the 31-year old rapper’s upcoming Motivation Tour.

The aggressive sales tactic shines a light on the positions that both Meek and Tidal are in. Championships is the Philadelphia rapper’s first album since his release from prison in April. His trials and tribulations have attracted widespread support, but now it’s time to turn that attention into album sales.

Tidal is seeking its own redemption. Based on recent estimates, the Norwegian-based company has around 3 million subscribers—far less than Apple Music (50 million) and Spotify (83 million). While Tidal’s current subscribers are loyal, growth has stalled. Finding new customers is a glaring priority.

Converting promotion-driven fans into lifelong customers is a tall order for any business, especially one that has faced the public scrutiny that the four-year-old company has. The results of this promotional run may dictate future moves that Tidal makes on its continuous quest for subscriber growth and profitability.

Both Tidal and Meek Mill value hip-hop fans that vote with their dollars. The fans who already support criminal justice reform are more willing to back a company like Tidal that shares its values.

Time for a turnaround

2015 was supposed to be a career-defining year for both Meek Mill and Tidal. That June, Meek dropped his sophomore album Dreams Worth More Than Money. It was Meek’s transition into mainstream rap. With Nicki Minaj on his side, the “All Eyes On You” rapper was destined to elevate his platform and put Philly on his back.

That same year, Jay Z announced the relaunch of Tidal. The Roc Nation founder was destined to win the culture over with an artist-owned platform that offered better sound quality than its competitors. “If these artists can sit in a room together, the game changes forever. And that happened today,” Jay said at the press event.

But 2015 turned ugly fast. Just one month after Meek’s album dropped, Drake released the Grammy-nominated diss track “Back to Back,” turning Meek into a hip-hop punchline. Meanwhile, Tidal quickly went from celebration mode to crisis mode. After the overwhelmingly negative reaction to Jay Z’s launch event, Tidal’s leadership changed hands an embarrassing number of times. Reports showed that the company had massive losses in 2015. Industry experts began to question whether Tidal’s value proposition was enough to compete with Spotify or Apple Music.

Three years later, its Meek who has recaptured that same energy. After hitting rock-bottom with his 2017 prison sentence, he gained support from influential friends, national media outlets, and the hip-hop community. Since his release, he’s built a stronger following and generated hype for Championships.

Tidal is still trying to bounce back. In 2016 the company had a big—but allegedly overstated—boost in subscribers from Beyoncé’s Lemonade, Kanye West’s The Life of Pablo, and Rihanna’s ANTI. It had another boost this past summer with The Carters’ Everything is Love. But many of these customers left once the 30-day free trial ended or complained on Twitter when they forgot to cancel their membership. Most other music streaming services have long since moved on from the once-popular exclusive album strategy.

The company has since shifted its focus to partnerships. Earlier this year, Tidal launched new deals with mobile carriers in Brazil and Uganda to expand its international footprint. This past month, Tidal also announced partnerships with Microsoft’s app store, Samsung Wearables, and Plex, the multi-media player system. These deals will help Tidal cross-sell to techies and audiophiles who spend money on high-quality technology (and in turn, might consider paying $19.99 / month for lossless sound).

These deals are smart tactics, but Tidal still needs to attract customers that are bought into Jay Z’s mantra of ownership. Consumers buy based on emotion and justify with logic. The ideal Tidal customers are inspired by the opportunity to support the artists, but rationalize their purchase because of the higher sound quality and other features.

When customers segment themselves

Those who back Jay’s mantra are also likely to feel compassion for Meek Mill’s tumultuous journey. Both artists efforts are united on the broader theme of black empowerment. Meek’s resurgence is not just a model for Tidal to replicate. It’s an opportunity for Tidal to continue riding that same wave.

Tidal has doubled down on its support for Meek’s freedom. When Meek served time, Tidal live streamed a conference about the artist’s legal challenges. This October, Meek performed at Tidal’s annual benefit concert for criminal justice reform. With the latest promotion, the streaming service won’t earn any money from the $3.50 booklets from Foot Locker—all proceeds go directly to #REFORM: a movement to liberate one million people unjustly caught in the criminal justice system.

The Foot Locker promotion, despite its steep cost, may offer Tidal beneficial data on prospective customers. To redeem the six-month subscription, fans have to physically go into a Foot Locker store and have a conversation with the sales associate:

“Hi, I’m good, thanks. Nope, not here for the all red Jordan retro 12s… Can I please get a Meek Mill collector’s booklet?”

It’s a simple task, but it makes a difference. A trial subscriber who walks into a store and asks the cashier for a special item is more likely to remain a customer than someone who quickly redeems a Cyber Monday deal that popped up on a social media timeline.

These efforts—the Foot Locker deal, benefit concerts, live streams— are an easy way for Tidal to segment prospective customers. Both Tidal and Meek value hip-hop fans that vote with their dollars. The fans who already support criminal justice reform are more willing to back a company like Tidal that shares its values. When Tidal starts prioritizing monetization over customer acquisition, these are the subscribers to target first.

Acquiring new customers is expensive. But if Tidal didn’t spend the money on promotions like this, the company’s internal teams would spend more time analyzing trends to identify these same potential subscribers. One way or another, it still a cost the company would have to pay.

If these promotions work well, then Tidal will dedicate more resources toward this strategy. The more of these customers it attracts—at a reasonable cost—the better. Tidal knows it can’t match Spotify and Apple Music’s scale, but it can get profitable by finding more of the right customers.

But if the Meek Mill plan doesn’t work well, Tidal will have to go back to the drawing board, once again, and try new methods to attract the subscribers it needs.

2019 might be another potentially career-defining year for both Meek Mill and Tidal. The outlook is positive for Meek, who has an Amazon docu-series and his concert tour to look forward to. Tidal’s future is less certain, but its safe to say the company won’t host another launch party.

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