The development of programmatic ad buying and selling has revolutionised digital media across most formats, from display to video, desktop to mobile – and it’s about to become a powerful force in digital radio and music streaming services too. Perhaps even more surprising, programmatic radio advertising may have a widespread impact on how advertisers attribute campaign success in the future.
In this digital age, the majority of consumers travel with a laptop, iPad, smartphone or all three. These devices are commonly used to stream music, live radio or podcasts, particularly during commutes on public transport. It often seems everyone on the tube, bus or train has headphones on. This isn’t a new concept, 20 years ago consumers had the Walkman with its built-in radio, but those were nowhere near as ubiquitous as smartphone and earbuds are today.
Most, music or audio programming arrives in our ears through apps. Popular streaming services like Spotify and Apple Music have boosted the growth of the music industry this year, while new offerings – including those from traditional broadcast radio companies like iHeartMedia – have entered the market with apps of their own. Programmatic audio represents a way to deliver addressable ads directly to consumers, leveraging targeted advertising served through those apps, much the same way that targeted display is delivered to mobile consumers.
This is potentially game-changing for the world of audio advertising, which has traditionally relied on broadcast radio’s reach and scale. Mobile devices and apps are treasure troves of consumer data, giving radio advertisers the ability to measure the quantity of consumers that hear their ads, what demographic groups these listeners fall into, and, potentially, insights into their activities post listening.
That final journey opens up a new world of attribution that is largely missing from both traditional radio and many online display and video campaigns. Programmatic display ads can leverage a wealth of data signals to reach a granular target, but to date, the majority of advertisers had limited resources to determine if the consumer paid attention to the ad. If the customer viewed an ad on a desktop computer and then travelled to a brick-and-mortar store to make a purchase, it was a laborious, if not impossible, process for most advertisers to connect the dots.
As nearly 80% of digital radio is consumed on mobile devices, advertisers can use the rich mobile data set to help with campaign attribution. By accessing the device ID, utilising geo-fencing and working with attribution partners to determine where a consumer went in the real-world after hearing an ad, it can be established whether the ad had any impact on their behavior or purchases. Traditional radio advertising is dominated by car dealerships, furniture retailers, and fast food outlets. If these businesses were to use programmatic audio, they could monitor how well their ads worked by using mobile measurement to track foot-fall from tuned-in consumers.
Another bonus for advertisers is that radio ads are served to a captive audience. Similar to TV, radio has always held appeal because consumers are likely to sit through ads as they wait for programming to continue. Individuals are unlikely to be listening to anything else, so the ads do not have to compete for attention as they do in traditional display. This is why podcast advertising has grown dramatically, and why 75% of podcast listeners take action on a sponsored message, according to NPR. But podcast ads are still bought the traditional way, via direct sponsorship models. Programmatic radio allows advertisers to target specific users based on various data signals, gaining an efficiency that is lacking in the world of sponsored media.
While many think of radio as strictly stuck in the domain of traditional media, the truth is that sound and music are incredibly important to consumers, who frequently use their mobiles as listening devices. As the popularity of streaming audio continues to grow, smart advertisers would be wise to leverage programmatic radio placements as part of their larger digital ad plans, while also paying special attention to the attribution abilities of programmatic audio. Forward thinking advertisers that tap into this rich new format will likely reap the rewards of fresh data that helps fuel their wider campaign strategy.