Audio advertising has come a long way in the last 100 years. From the earliest days of untargeted ads broadcast across analogue airwaves to the latest in real-time programmatic tech – just where do we stand today?
With millions of us plugged into a mobile or home device delivering digital audio content as we walk down the street, sit on the bus or train, or simply spend time at home, there’s no shortage of options for digital audio. The same goes for content choice: digital radio (live and on-demand), podcasts, music streaming services and audiobooks all vie for the digital airwaves.
For advertisers, digital audio represents a great opportunity for incremental reach, particularly in the branding space. With the large amounts of inventory available – which we’ll go into a bit more later – advertisers are able to find most of the audiences they’re looking for, many of which they may not be able to reach via other channels. Moreover, as one of the safest channels for branded content, there are few barriers to entry other than the need to bespoke audio creative – your standard TV ad unit most likely will not cut it.
Audio by the numbers
Before we dig into the details of how the buy and sell side can better leverage programmatic audio, let’s set the stage with some numbers:
- In February 2022, eMarketer estimated that 221.9 million Americans (65.8% of the population) listen to digital audio on a monthly basis. This is predicted to rise to 67.2% by 2025, which equates to 231.2 million people.
- Digital audio will account for 12.7% of overall media time among US adults (eMarketer April 2022). And where the audience goes, advertisers must surely follow.
- Digital audio ad spending in the United States is estimated to reach $6.31 billion in 2022, up 10.8% year-on-year from 2021. Programmatic is set to represent $1.31 billion of that ad spend, increasing to $1.8 billion in 2024 (eMarketer May 2022).
Turning our attention to the audio inventory we see on BidSwitch, totals are currently around 95 billion audio ad requests per month, with the majority of the inventory coming from the US, UK, EU and Japan. As expected, over 50% of this inventory is originating from mobile devices, with the remainder coming from connected TV and desktop devices.
If you're interested in getting started with audio and working with some of the world's leading audio suppliers, including DAX Audio, Triton Digital, YieldOne, Magnite, and The MediaGrid, we can help.
The advantages for buy and sell side
With over one billion dollars in ad spend forecasted for programmatic audio in 2022, digital audio is now a realistic addition to the marketing mix – and it provides some very specific advantages.
Digital audio offers advertisers the ability to target listeners with the same audience segments they would for other programmatic channels – whether that’s display, mobile, or connected TV (CTV). Supplementing this targeting with data from audio partners provides additional granularity in terms of reaching specific demographics and interest groups, while the well-defined themes of many podcasts enables advertisers to target ads at relevant groups based on listening habits.
Not only that, but research shows that in the US, podcast audiences tend to be young, well-educated, employed and from relatively affluent households.
Where audio differs from other channels is that people often don’t do anything else while listening (unlike the trend for “second-screening” while watching TV, for example, or consuming multiple digital offerings at the same time). This captive audio audience is therefore directly connected to the content – a factor that presents brands with various unique opportunities.
Publishers, meanwhile, have access to an ad format which offers them high CPMs with revenues enhanced by the fact that audio cannot easily be blocked. Even better, ad quality is not dependent on the type and size of the screen, and programmatic audio is well-adapted for mobile – the device on which most audio streaming takes place.
Like any other digital advertising channel, programmatic audio is not without its hurdles.
Right now, the most obvious of these is limitation on supply and demand.
Simply put, there are a limited number of publishers with scaled supply which restricts the programmatic opportunities available in the open market. However, as more inventory becomes available through programmatic channels, the space is set to grow significantly in the coming years.
The most significant challenge with audio inventory is probably measurement, especially when it comes to cross-device attribution. That said, with the loss of the third-party cookie, audio is by no means alone in this. For audio, this represents a unique challenge, because a conversion will always take place on a secondary channel. Even so, the IAB has recently released its Digital Audio Measurement Guide which provides the needed guidance for this quickly growing space.
Finally, it’s important to remember that many of today’s most popular programmatic platforms were not designed with audio formats in mind. Consequently if you are looking to utilize programmatic audio in the future, you’ll need to make sure you find a partner who can support your needs and fully support these nascent formats.
Long live the audio revival?
Audio is one of the oldest content channels in the world, but it’s only fairly recently that it’s found a way to integrate with our newly digital world – and started to deliver results for all sides of the advertising industry.
With ever-increasing technological advances – in-home, gaming, mobile, etc. – the future of digital audio looks set to be an exciting space.
For example, with improvements in keyword, contextual and sentiment analysis, ad insertion will be a critical area to watch. Interactive advertising with voice search, including the transactional aspects of in-house devices, will most likely be an area that drives considerable interest – particularly from retail advertisers.
Over the next few years, we’re sure to see programmatic audio become firmly embedded in media buying plans, providing brands, publishers and users with additional creative ways to engage and enhance their various relationships.
We’re all ears.