Strategy Lessons from Taylor Swift

by Charikleia Kaffe and Martin Reeves

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"I'm intimidated by the fear of being average” - Taylor Swift .

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Taylor Swift is the biggest pop star in the world: She was the most streamed artist on both Spotify and Apple Music in 2023, and is now one of the all-time best-selling musicians – at just 34 years old. Her influence extends beyond the world of music, even being recognized as a significant force in the US economy , to which her Eras tour is projected to provide a $5.7 bn boost. Given her impact, she has been named TIME person of the year in 2023. But Swift’s success is not a passing fad - she has been persistently on top for more than a decade. She was already Billboard’s biggest moneymaker in 2012 and had reached the #1 spot on the Billboard Hot 100 chart . Since then, she has gone from strength to strength: Having chart-topping hits in 2014, ’15, 17’, ’20, ’21, ’22, and ’23, and winning 6 Grammys.

Her persistent success comes at a time of turbulent change for the music industry and for business in general. Traditional recipes such as a contract with a record label and access to studio time, are no longer obligatory: The democratization of music production means that big budgets are no longer necessary to make a record. For example, Billie Eilish’s Grammy-winning debut album was recorded in her brother’s bedroom and produced using software and equipment totaling costing less than $3,000 . The concurrent democratization of music distribution (and consumption) means that big marketing budgets are also no longer a prerequisite for success – as illustrated by (then completely unknown) rapper Lil Nas X’s single "Old Town Road" going viral on TikTok to score him his first Billboard Hot 100 Hit . But exploiting and shaping new business models requires agility and creativity. Furthermore, democratization doesn’t come without a cost: As old barriers to entry fall, competition is becoming more fragmented, dynamic and fiercer than ever.

Avoiding regression to the mean in a turbulent environment is an anomaly – not just in art, but also in business . Competitive advantage is decaying more quickly than ever and only a handful of companies are responsible for aggregate net wealth creation. What, then, is driving Swift’s unusual persistence at the top? While she is without doubt a talented singer and songwriter, it cannot just be her music, given that her style is often rapidly imitated, whether out of calculated commercial interest or because fellow artists idolize her.

One hint is that Swift is recognized not just as one of the best musicians, but also as one of the savviest businesswomen of her generation – not only by fellow artists , but also by the richest man on earth . We concur – and posit that Swift’s persistent, outsized success was enabled by a strong intuition for good strategy. Below, we showcase three of her key moves.

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1.???? Creating emotional connection in a digital world

Since the beginning of her career, Swift has worked hard to meet fans where they are: online. Fostering an active and engaged fan base first on Myspace and Tumblr, and later on Instagram and TikTok allowed her to establish direct connections to her fans. She frequently likes, comments on, and reposts fan content. Swift’s communication is personal and relatable, much like her songs and albums – she is known for standing up for her fans and has even hand-selected some of them to participate in live, secret listening sessions before album releases. By leaving “clues” in her posts about her next moves for fans to decipher, she constantly creates buzz, anticipation, and repeated engagement.

Swift’s digital communication strategy has created a large and loyal community: She is the most-loved celebrity by number of likes per post on Instagram (7.8 mn per post ), which also translates into an outsized influence – Vote.org saw a 1,266% jump in voter registration the hour after Swift encouraged her followers to vote. Strategically speaking, the direct emotional bonds she has created with her fans – who feel like she is “one of them” – serve as a crucial moat for defending her position against a constant stream of potential substitutes.

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2.???? Directly controlling her work

Swift is renowned for her self-ownership and self-management, serving as a unique and powerful example of disintermediation in the digital age.

Breaking traditional (mental and business) models in the music industry, Swift made a highly publicized move to gain control over her music rights by re-recording her first six albums, while also negotiating for the rights to the masters of her work when she transitioned to a new label. Her activities are also managed with by a small team and Swift has chosen to not rely on external managers or agents. In the same spirit, she also chose to release her recent concert film directly instead of going through conventional film studios. By managing the means of production and distribution of her work, she is not only maximizing her value capture but is also able to rapidly respond to a changing market, being neither insulated from vital feedback by distribution layers or beholden to existing mental models and rules.

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3.???? Constantly reinventing herself

Many artists begin to fade from relevance when they can no longer keep up with changing tastes and trends set by new talent entering the industry. Swift, however, has managed to not only consistently renew herself, but to shape new trends in the industry.

She has moved between genres, starting from country music, then transitioning to pop, and more recently to indie-folk and alternative styles on her back-to-back pandemic albums – all while also experimenting with genre-spanning collaborations with other artists. In her storytelling, she has managed to strike a balance between more mature and playful themes, ensuring that her work continues to resonate with her existing followers as they grow older, as well as with younger fans. She also reinvented her concerts, setting new standards for the industry: Her ongoing Eras Tour is a comprehensive cultural event taking the audience in a music journey spanning her 17-year career, lasting over 3.5 hours with 40+ songs in the setlist. Every show also includes an element of surprise with a handful of show-specific songs, making the experience memorable, unique and very “shareable” on social media.

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Strategy is an applied art, and Taylor Swift exemplifies the power of a strong intersection between art and strategy. Her strategic moves are all relevant to businesses, which should not be merely entertained and inspired by her work but should also pay close attention to the generalizable strategic lessons from her success story.