Audio pubs are extremely protective of their audio inventory and are therefore reluctant to make it too easily accessible. Most iHeartRadio inventory is sold direct, often packaged with events and other inventory. When clients ask for a programmatic solution, they can access a private marketplace via partner platform AdsWizz.
But iHeartRadio doesn’t participate in open exchanges or enable RTB buys.
“I’m looking for partners who want to do something more premium, understand the value of the listener and aren’t just looking to get the cheapest price on some cookie match,” said Brian Kaminsky, head of programmatic and data operations at iHeartRadio’s parent company, iHeartMedia.
Spotify, which launched its private marketplace in November, wants to use programmatic to drive up the value of its inventory by incorporating better targeting mechanisms.
“We can generate all sorts of insights into our users because they’re all logged in,” said Jana Jakovljevic, the company’s head of programmatic solutions, in a February interview. “We know what time of day they’re listening, what they’re listening to, what device they’re listening on and where they’re listening from.”
So while the early days of programmatic display was a way to pool inventory, that’s not the case with programmatic audio. And there might not be enough advertiser demand right now to support audio inventory, if it were available in an open exchange. Piquing advertiser interest is a legitimate concern.
“It’s something that, more often than not, we’re bringing to advertisers as an opportunity,” said Oscar Garza, global director of programmatic at Essence. “They know its possible, but they’re not really considering it as part of their primary mix.”
Sean Black, North American media services lead at SapientNitro, said, “Audio is just adding another scalable option for us to reach consumers on inventory that we weren’t able to throw into the mix.”
There seems to be a disconnect in how audio inventory is perceived: Pubs view it as premium; advertisers and agencies, by and large, don’t.
But that might be changing. Some agencies are starting to see digital audio as integral for targeting on mobile. It presents the opportunity to diversify audience buys and thus reach more customers – especially on mobile, where, according to an eMarketer study published last July, 75.8% of digital audio listening occurs.
“In a world where you have a million mobile phones, audio is a great medium to target users on those devices across the world,” said Sims.
Certainly, this is in line with Spotify’s messaging around its programmatic offering.
“Audio combined with mobile becomes particularly powerful in programmatic,” Jakovljevic told AdExchanger in February. “Buyers can target someone based on the time of day, their location and Spotify’s own data. Is someone working out right now? Are they at a party? Are they commuting? What is the person interested in, and what are they feeling? Are they listening to a happy playlist or a sad one? We can make all of those insights available to buyers.”
Audio is also completely transparent and immune to ad blocking, and it doesn’t have to compete for listener attention.
“When you start talking about environments when ads are more cluttered and it’s hard to break through, digital audio gives [advertisers] an opportunity to be heard,” Greitzer said.
Advertisers, however, are still bound by the perception that digital audio lacks the same clout as TV and other media and that one of the biggest roadblocks facing programmatic audio is measurement.
According to Benjamin Masse, head of market development and product strategy at digital audio technology company Triton Digital, digital audio, unlike terrestrial radio, offers precise 1:1 measurement. But attribution, which is difficult across all digital advertising, poses a greater challenge for audio. With the performance-driven nature of advertising today, better targeting doesn’t really bring value on its own without the ability to measure or attribute the spend to tangible KPIs. And direct response metrics like click-through rates tend not to apply.
“A lot of people will listen to audio on their smartphones but may be converting on a website or a point of sale,” said Masse. “Sometimes, it’s easy to connect through cross-device capacities, but cross-device is still nascent.”
Both Garza and Black said they need to be able to measure the success of programmatic audio against specific campaign KPIs before they buy that way for clients. Without these metrics, agencies can’t advise their clients on which portion of its programmatic budget should be reserved for digital audio buys.
Which isn’t to say the value of programmatic audio is entirely unknown. Greg Anderson, managing director at Xaxis Media Group, Xaxis Radio, has seen digital radio and display ad exposure lead to increased brand recall and worth.