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Digital Audio advertising: The state of play

Digital audio has become part of most people’s daily routines. From listening to podcasts on the commute, to streaming playlists at the gym, audiences are tuning in wherever they are – and marketers are following.

Digital audio advertising’s growth has been just as impressive as the growth of digital audio itself. Advertisers doubled their investment in digital audio between 2020 and 2022, with a total of £186 million spent last year.

Scanning the airwaves

While music and podcasts make up the majority of the digital audio that audiences are listening to there is a range of types of audio that advertisers can use to reach their target audience:

  • Podcasts
  • Music streaming
  • Audio blogs
  • Digital/online radio
  • Audiobooks
  • Voice search

Tuning In to digital audio

So why have marketers rushed to put ad spend into digital audio advertising?

The most obvious answer is the increasing amount of time consumers spend listening to digital audio. In the UK, it’s estimated that by 2024, 40 million people will listen to some form of digital audio. On average, UK consumers listen to around 13 hours of digital audio a week across a range of devices including smartphones, smart speakers, desktops and even TV.

Digital audio is highly personal by nature, with ads often being beamed straight into the earphones of audiences. This not only enables marketers to be highly creative with their ads, but also deliver a greater impact on listeners – digital audio can achieve 24% more recall than visual display ads, as well as doubling consumer purchase intent.

Another thing that digital audio lends itself to naturally is identifier-free targeting and personalisation. With a range of niche podcasts, radio shows and music available to listeners to stream, advertisers can more easily find their target audience. A sports clothing brand, for example, could look to place its ads on football podcasts to reach target listeners.

Digital audio opens up a world of creativity for marketers. Using the digital footprint of users, different aspects of podcast advertising creative can be tweaked and personalised to ensure maximum impact. Tens of thousands of versions of the same creative can be easily created by swapping voiceover, music and sound effects in line with a target audience’s specific needs. Generative AI is likely to enable marketers to tailor digital audio ad creative even more easily and at greater scale.

Buying digital audio

For marketers looking to expand their digital advertising into the world of audio, there are a number of ways to purchase digital audio ads:

Manual ad insertion

This is the more traditional way of inserting an ad into digital audio. Ads are bought in advance directly from the publishers and ‘baked’ into the audio. Until recently, audio ads were bought this way.

While this method allows for more natural ad formats  – podcast hosts could read out sponsor information for example – they take more time and resources to implement and lack true scalability. For marketers looking to run limited time promotions, messaging can also quickly go out of date.

Dynamic ad insertion

A highly popular way to purchase ads, especially in the podcasting space – Dynamic Ad Insertion (DAI) now accounts for 84% of all podcast advertising.

This method is a significant step forward for advertisers. Content providers mark spots within their audio files for ads to be placed – whether that be in between songs, chapters of an audiobook or a natural break point in a podcast. Advertisers are then able to serve an ad in that slot when content is downloaded or streamed.

Not only does this ensure up-to-date messaging can be delivered, but advertisers can target audiences on a more granular level down to the individual song or podcast episode.

However, there is a lack of measurability for advertisers when it comes to DAI. While data on whether an ad was downloaded is visible, there is little insight into whether it was actually listened to.

Programmatic insertion

While it is still early in the development of programmatic audio ads, the potential is evident. Already Spotify has made Private Marketplaces (PMPs) and Programmatic Guaranteed (PG) buys available to advertisers, and it is only a matter of time before further streaming services begin to implement programmatic.

Programmatic audio ads lower the barrier for entry for brands looking to enter the digital audio space. With the ability to buy ads rapidly and a greater wealth of insights available, programmatic audio allows brands to view the effectiveness of their spend and pivot in real time to maximise the potential of their ad budgets.

Where next for digital audio advertising?

With audiences still flocking to digital audio, brands will continue to increase their spend in this channel. In fact, two-thirds of media buyers state that they will be looking to invest more into digital audio ads within the next 12 months.

It is still a maturing sector however. While programmatic buying is slowly increasing, it still only makes up a small percentage of overall ad buys – just 1.7% of the podcasting market.

There have also been questions around brand safety. High profile incidents – such as Joe Rogan spreading Covid misinformation – have given some marketers pause. The power of AI and machine learning to assess the sentiment of audio on the episodic or track level however has started paving the way for more sophisticated brand safety tools to allow brands to reach scale with their digital audio ad spend more confidently.

While still maturing as an advertising channel, digital audio is already a highly effective way to reach audiences wherever they are and whatever they are doing. As its personalisation, targeting and brand safety capabilities become more advanced, marketers should look to bring digital audio into their omnichannel media mix. 

If you would like to hear more about how digital audio advertising can help you reach your audiences, contact us xxxx

LinkedIn: From listening to a podcast on the commute to putting on a playlist during a gym workout, digital audio is quickly becoming part of many people’s daily routine.

For advertisers, digital audio is an increasingly effective way to grab the attention of audiences. In our latest blog we take a look at the current landscape for brands looking to get into the ears of consumers.