One media tactic that has been coming up more and more frequently in our planning discussions is streaming audio, including podcasts. And with good reason: The market for streaming audio has grown steadily over the past few years, driven by the ubiquity of smart phones, the increasing popularity of smart speakers like Amazon’s Alexa, and the growth of streaming services like Spotify. In addition to the widespread work-from-home arrangement necessitated by the pandemic (but expected to continue at least part time for many workers into the foreseeable future), these innovations mean more people than ever have made streaming audio a part of their daily routine.
What is streaming audio?
Streaming audio includes internet streams of traditional broadcast radio stations either directly on site or through apps like iHeart and Audacy, as well as pure-play services like Spotify, Pandora, and Amazon Music. (Apple Music is another pure-play service, but does not offer advertising opportunities.)
While the pure-play services offer ad-free premium subscriptions, a majority of users on each platform still use the ad-supported versions. Traditional radio streams typically offer separate digital ad inventory that runs during their normally scheduled commercial breaks.
Who’s listening?
Just about everybody.
Regular monthly streaming user totals by service:
- Spotify: 356 million; 56% use ad-supported (source: Spotify)
- Pandora: 58 million; 89% use ad-supported (Pandora)
- Amazon Music: 55 million* (Techcrunch)
- iHeartMedia: 128 million** (Statista)
- Audacy (formerly Entercom and RADIO.com): 40 million** (Audacy)
*Ad-supported vs. premium users unavailable
**Totals are pre-pandemic and have likely increased
According to Edison Research, 74% of adults ages 25-54 now regularly stream music, news and podcasts each month. Among adults 18+, this figure is 64% (Nielsen). Since COVID, adults 18-54 spend more time streaming audio than they do on social media, broadcast TV and streaming video.
How has listening changed?
While broadcast radio has traditionally relied heavily on drive-time listeners, streaming audio advertising reaches target audiences wherever they are and whenever they’re listening—whether in the car, at the gym or at home. At-home listening in particular has experienced massive growth during the pandemic.
- Smart speakers are now present in more than a third of US homes (Edison Research/Triton Digital)
- Global sales are expected to grow over 20% in 2021 (Canalys)
- Time spent listening to smart speakers increased 43% between Q1 and May 2020 (Edison Research)
- Of people working from home, 75% stream audio weekly, and 40% stream every single day (Nielsen)
- 90% of podcasts are now listened to at home (Edison Research)
Podcasts are driving streaming audio growth.
Podcasts are among the largest drivers of growth in the streaming audio space. While they were traditionally accessed primarily through Apple’s iTunes and Podcast apps, the addition of podcasts to Spotify have made them accessible to a wider listener base and have greatly expanded opportunities for marketers to take advantage of them. Currently 41% of Americans over age 12 listen to podcasts on a monthly basis—an 11% increase over 2020 (Edison Research, Triton Digital). Spotify, which allows users to easily toggle between music and podcasts within one app, is expected to overtake Apple for the most podcast listeners in 2021, with more than 28 million regular podcast listeners (eMarketer). The number of podcasts has also increased drastically to more than 2.1 million by April 2021, with more added daily (Oberlo).
How can marketers enter this space?
There are several options available to brands that want to capitalize on streaming audio and podcast audiences. Several media partners offer access to audio ad inventory across different genres and provide packages that include spots in radio station streams, podcasts and music across multiple services.
Why should they?
The growth of streaming services and connected devices offers a far more targeted approach than traditional radio. While the traditional, contextual targeting approach is still an option (think targeting sports podcasts), marketers can now utilize the more granular demographic and behavioral targeting segments more commonly associated with display ads. In our most recent streaming audio campaign for Iroquois Healthcare Association, for example, we were able to target job seekers ages 18-34 within our specific geographic targets.
Streaming audio ads are effective. One study found that audio ads are twice as likely as display ads to lift purchase intent. They’re also typically seen as more informative to the listener than display ads and have a significantly higher recall. This is due in part to the fact that ads are not easily skipped; listeners are unlikely to take off their headphones or turn off their speaker when an ad comes on compared to traditional radio, where they can easily change the station during commercial breaks. One streaming audio vendor we work with has a benchmark of 94% completed listen rate.
Because of the digital targeting tactics available in the space, as well as measurement ranging from listen-thru rates to listen-thru impressions (that is, a user heard an ad and later visited a brand URL), brands can invest more confidently than in traditional radio, knowing that their message is reaching the right audience.
Given the expected continued growth and effectiveness of this tactic, it is worthy of consideration for your future campaigns.
Ready to learn more? Contact me at cgallagher@mower.com.