Differentiation. It’s one of the most important elements of good brand-building and something every potential startup and entrepreneur should be thinking about before they charge forward to make their millions. However, just being “different” isn’t exactly the cornerstone for separation from current or potential competitors. Differentiation needs to add value. Otherwise, what good does it do for the consumer?

Earlier this week, as I perused the latest headlines and snuck a peek at what was trending online, I learned that artist and media mogul Jay Z had held a press event announcing the relaunch of TIDAL, a subscription streaming service he recently bought for $56 million. What struck me after reading all about the “new” service and the list of musical artist heavyweights supporting the endeavor as part owners is how clearly undifferentiated the service actually is from its competitors.

Now I freely acknowledge that I’m probably not the primary demographic for this new venture by Jay Z and friends. However, I’m loath to believe that music lovers of any generation would lap up the goofy statements and hyperbolic claims made by TIDAL’s owners and let it all simply come to rest as real and genuine. Then again, does it matter whether or not they believe Kanye West when he said, “I just thought about how, like, crazy this is, how this is, like, the beginning of the new world,” or Jay Z claiming that TIDAL is going to “change the course of history forever?” What really matters for TIDAL and what will determine its success or failure is twofold:

1. Will consumers perceive the service offering as differentiated from the competition?
2. Will consumers see value in the service?

So is it differentiated? Will it provide value? Or is Jay Z just relying on the megasuperstar power of Madonna and Beyoncé and other artists like Daft Punk – whose ubercool style and sleek black helmets would make even Darth Vader a bit envious – to dazzle consumers into thinking the service truly is different?

Just Listen, It’s Better

So on the surface it appears that the value proposition or improvement in TIDAL’s streaming service over the competition is CD-quality music streaming at twice the price ($19.99 a month compared to $9.99). The obvious first question is whether or not there’s a market for those willing to pay for the higher-quality format. Especially 10 bucks more. The answer is yes. But it’s a relatively small segment right now. Yet there’s a bigger issue of using lossless-quality audio as a point of differentiation and part of TIDAL’s value proposition to consumers. Author Stephen Witt explains in his book “How Music Got Free” that there is considerable research showing that the human ear is pretty much incapable of detecting the elements of sound that MP3 files shave off – the average piece of music contains far too much information for us to actually process. Oops. There goes that argument.

Save Us, Nicki Minaj

Nicki Minaj, armed with her carefully crafted talking points (nope), stated that the band of 18 superstars were going to “come together and take a stand and give people quality and great things and great experiences.” Aha! Most of that was crap, but then Miss Minaj said “great experiences.” Now we’re getting somewhere.

A strong value proposition is a believable collection of the most persuasive reasons your target customers should do what you’re hoping they will do. Darling Nicki told us that TIDAL’s target customers are going to get great experiences if they sign up for TIDAL’s streaming services. While “great experiences” isn’t exactly differentiated, it is something that resonates with a little group we call millennials, if served up right. And in this case, it’s being served up by 18 megawatt musicians – with at least one of whom a majority of millennials can connect. Why is that important?

Millennials and Music

There are 80 million millennials in America alone and they represent about a fourth of the entire population, with $200 billion in annual buying power. And guess what? They love music.

So what do millennials expect from their favorite musical artists? And what should an artist/fan relationship look like in the 21st century?

According to “The 7 Attributes of Younger Music Fans” by Paul Resnikoff, millennial music fans:

1. Probably won’t “buy” your music – because they think music should be free. But if they DO buy your music, it’s a gesture of extreme support and gratitude.
2. Crave “intimate glimpses into the mundane daily activities of their favorite celebrities,” according to MTV’s Alison Hillhouse.
3. Want to feel involved in the creation, branding and taste-making process.
4. Need frequent interaction on a number of social platforms.
5. Prefer “zero distance” between artist and fan. They want constant access – and intimate details.
6. Are fond of shuffle mode listening, playlists and a diverse array of artists and genres.
7. Don’t care about artists “selling out.” According to an MTV study, they “understand that the system of getting free music/streaming means artists have to make their money somewhere.”

If TIDAL hopes to capture what is arguably the biggest and most logical target for its service, the millennial consumer, it will have to make good on promises like Minaj’s “great experience.” The music streaming landscape is already a crowded one, with powerful competitors including Spotify, Pandora and Apple offering similar, if not better, streaming services than TIDAL.

In a recent Billboard magazine interview, Jay Z touched upon this idea of a unique experience for subscribers of TIDAL by saying, “What if it’s a video offering tickets to the next concert, or what if it’s audio or video of the recording process? It could be anything. It could be them [the artists] at home listening to songs that inspire them. Anything they want to offer, you know; just be as creative as possible, that’s the only charge, really.”

Will these kinds of engagements and experiences be enough of a point of differentiation for TIDAL to make waves long into the future? We’ll see. But really … how could this group go wrong?