Programmatic Audio Emerges as a Key Format as Listening Picks Up
With more digital voice technology available to listeners, be it smart speakers, voice assistants, or Apple CarPlay, digital audio is on the rise, particularly in podcasting: podcast ad spend is expected to double to $1.6 billion by 2022.
Meanwhile, the COVID-19 pandemic has accelerated current trends that already point to increased digital audio spend. With a decline in live concerts, listeners are turning to subscription-based streaming platforms to access music. After an initial downswing of podcast listening due to a pause in daily commutes, podcast listening has bounced back as audiences continue to download their favorite podcasts and discover new ones from home.
With competition in the audio space heating up, audio media platforms are increasingly paralleling streaming video models and investing in exclusive, original content to win listeners’ ears. Here are some current trends we’ve seen in digital audio and how they’re reshaping how media platforms attract audiences.
Audiences Are Turning Up the Volume on Digital Audio
Overall, all sectors of digital audio are seeing growth. This includes streaming music channels such as Spotify or Pandora, live talk, radio, and sports, and podcasts.
Currently, there are 204 million digital audio listeners in the U.S., and American audiences spend more time listening to digital audio than browsing social media. Ad dollars are following audience behaviors: digital audio advertising is projected to grow 17% this year. Looking forward, this surge shows no signs of stopping: a report commissioned by Goldman Sachs shows streaming users are expected to rise nearly 4x in the next ten years. It also estimates that the online streaming market could grow to capture 1.2 billion users by 2030.
Likewise, paid subscriptions for on-demand streaming services such as Spotify and Apple Music jumped a whopping 25 percent over the past year. While all sectors of audio are showing growth, none are increasing as rapidly as podcasts.
Digital Marketers See the Perks of Podcasts
Of digital audio listeners, podcast listeners are currently the fastest-growing audience. Marketers are quickly recognizing the opportunity presented by what was once a fledgling format: podcasts capture coveted, younger audiences and repeat listeners, are less likely to be skipped, and have one of the highest engagement rates: 80 percent of podcast listeners listen to an entire podcast episode. Further, 54 percent of podcast listeners are either somewhat or much more likely to consider buying from a brand after hearing a podcast ad.
As podcast listening grows, accelerated by smartphone adoption, the growing demand is shaping media platforms’ business strategies, pushing them to expand their platforms with exclusive content.
Amazon is actively trying to integrate podcast listening into its Audible app to provide a viable alternative to either Google or Apple in this vertical. Spotify, which boasts 286 monthly active users, has also made investments to build out a holistic listening experience on its platform, including streaming music and podcasting. Recently, it disclosed that it will pay upwards of $196 million for The Ringer, the podcast and media company founded by Bill Simmons. As more media platforms enter the podcast arena, the competition over content is heating up.
Across Emerging Platforms, Content is King
The push in digital audio towards ring-fenced, subscription-based content parallels the journey of connected TV (CTV), where users are ditching linear television to stream TV programming through an internet connection and media providers are paying top dollar for exclusive creative. Just as Spotify is now spending millions on content creators, streaming platforms like Netflix, Hulu, and Amazon Prime, are all pouring investment into original series and films. It’s a world where content is king and high-profile acquisitions and bidding wars are becoming the norm.
As media companies expand their programming across platforms (including streaming video, podcasts, books, music), having an omnichannel, scaled solution for delivering programmatic ads across channels becomes paramount. Media providers that can best optimize the viewing experience and ensure a positive ad experience for marketers will win the market advantage. To do so, they will need the technology and scale to provide measurable, targeted, high-quality viewing experiences in real-time.
Here, Rubicon Project and Telaria are uniquely positioned to serve the changing habits of consumers and help media platforms build their channels across inventory types, be it in audio podcasts or CTV. As more marketers recognize the immense opportunity of digital audio and emerging channels, we offer a truly omnichannel, scaled solution which buyers and sellers can work with. As passive listening takes a more prominent place in our lives, digital audio is a growing format brands and marketers simply can’t miss out on.
For more information regarding audio and CTV solutions, reach out at email@example.com.