According to estimates, 82.1 million Americans pay for on-demand music streaming and based on a report by Insider Intelligence, there are expected to be more than 144 million monthly podcast listeners by the end of 2025. This makes audio ads one of the most popular forms of advertising and an essential part of any marketing strategy. Audio ads are a form of advertising which uses audio content to promote products or services, usually heard on traditional radio, digital radio, or streaming audio, and include a variety of inventory types, like podcasts, playlists, genres, and live events.
With the rise of streaming music services on mobile devices, such as Spotify, Apple Music, and Pandora, companies find that audio ads offer them a new and effective way to reach their target audience. However, navigating the world of audio advertising can be a challenge for media buyers.
In this article, we’ll discuss the benefits of audio ads, some key challenges of audio ads, and how working with a programmatic audio ads buyer could help you achieve your goals.
The benefits of digital audio ads
73% of the US population (an estimated 209 million people) have listened to online audio content in the last month, up from 68% in 2021.
Audio ads have numerous advantages and are effective because they don’t require visual attention and therefore don’t intrude on a person’s daily routine. Advertisers can easily adjust the ad’s timing, length, and frequency to maximize impact while respecting the digital audio listeners. Plus, campaigns can be tailored to specific audiences, allowing businesses to reach the right people with their message.
There is an emotional component you can’t get in other media types because music is nostalgic. And when people listen to their preferred streaming platforms or podcasts, there is typically less noise in the background, so they’re more deeply invested in the content and ad delivery—resulting in improved brand awareness and customer loyalty.
Because of higher conversion rates, many advertisers have found that digital audio ads provide a high return on investment (ROI). Audio creates a more engaging and memorable experience, making it more successful at getting customers to take action after hearing it during their favorite true crime podcast.
The main challenges of audio advertising
One of the significant challenges companies face with digital audio advertising is navigating the expanse of supply from various publishers and sellers. Different audio media suppliers have different inventory, capabilities, and campaign requirements. It can be difficult to unify an audio media buy that incorporates a good mix of audio supply across multiple premium sellers.
Media buyers can approach access to audio supply in a few different ways; each has its advantages and disadvantages.
- Publisher Direct: Buying direct from the publisher can help take full advantage of available supply and targeting capabilities but is more difficult to execute across disparate platforms and systems.
- Open Marketplace: In an Open Marketplace, audio media supply can be accessed at greater scale from a variety of publishers. However, inventory is not as transparent, and availability can fluctuate from day to day. Additionally, some inventory is not made available in the Open Exchanges.
- Private Marketplace: In many ways, Private Marketplaces can be considered a hybrid of Publisher Direct and Open Market. Media Buyers can work with sellers to access audio supply with greater control without the need to execute individual deals with multiple publishers.
Seasonality and Volatility of Availability
Audio media supply suffers from an abundance of demand that fluctuates very dynamically and availability can be greatly influenced by advertiser competitiveness. Major U.S. holidays like Christmas or Fourth of July and popular events like the Olympic Games or the Super Bowl can increase demand significantly, driving prices higher and decreasing avails.
The future of digital audio advertising
As we look ahead, digital audio will continue to evolve and reshape advertising. To further facilitate the growth of this segment, in June of 2022, Spotify and IAS (Integral Ad Science) announced a partnership to establish a brand safety solution to protect podcast advertisers from potential risks.
They plan to conduct a comprehensive analysis to bring more transparency and confidence to podcast advertising. Data from this study will allow the industry to understand how brand safety can be effectively delivered through podcasts and digital audio. They aim to develop the industry’s first third-party assessment tool for brand safety and suitability.
This partnership is an essential step in establishing trust between brands and publishers.
Working with a programmatic audio advertising partner
Based on Insider Intelligence, more than 90% of digital display ad dollars will be transacted through programmatic means in 2022.
Your business can grow significantly with programmatic audio advertising, but creating a winning programmatic advertising strategy can be challenging. To develop a successful plan, you must be familiar with ad technology and market volatility. Many businesses are turning to programmatic buying companies to help with the challenges of audio advertising.
With deep knowledge of programmatic audio ads, they can help manage audience targeting, scale, and avails volatility. Programmatic advertising partners will have access to and relationships with streaming platforms and audio supply owners that are often unavailable through more traditional buying methods. They can advise on audio inventory, the best ways to purchase advertising, and find suitable audio ad placements for your target audience and budget. Through automated systems, they can also proactively optimize ads, which can help businesses create brand awareness and improve digital KPIs.
Businesses can access inventory and navigate the complexities of audio ad placement by having a partner that understands the digital audio landscape. With extensive multi-channel buying experience, Lean Media can help you improve ad spend and achieve the best results for your campaigns. Connect with us to learn more.