Spotify: Podcast Ads "Really Delivering" Against Measurement &  Effectiveness


The head of sales at Spotify ANZ has informed B&Tthat that the rise in interest in audio advertising results from the fact that the industry has begun to refine its effectiveness and measurement measures.


“We know that one major challenge the industry is facing is being able to measure results and track effectiveness adequately, and I think podcast advertising is delivering against this now, with creative performance metrics, confirmed ad impressions and a deep understanding of the audience listening being part of the norm at Spotify,” Adrian Bingham said. Adrian Bingham.


Audio advertising has been among the most discussed topics this year; with IAB Australia recently holding its Audio Summit, PWC reported that audio ad spending would increase to more than $200 million this year. 71 % of media agencies said they would increase their investment in audio streaming.


“Something not entirely new, but a trend we’re also witnessing is the shift to buying and planning media based on the participation of a targeted audience. Podcasts are the perfect avenue to achieve the need for advertising,” added Bingham.


Spotify can now offer an authentic audience and demographic segments on a massive scale through Nielsen, according to Bingham. Consequently, Spotify has become one of Australia’s biggest media companies.

The company also provides cards for call-to-action powered by Spotify’s Streaming Ad Insertion (SAI) technology. They are specifically designed to be visible while a company ad is playing and after the advertisement has been played.

This technology lets advertisers observe the effectiveness of campaigns on an impression as well as insights that Bingham explains.


“We have run campaigns recently with clients such as L’Oreal CeraVe and our original podcast, The Inspired Unemployed, with the click-through rate from CTA cards delivering six times our benchmark,” said the spokesperson.

“We measure success at Spotify with Reach, Reaction & Resonance and can provide clients with detailed analytics and performance metrics, including first-party and third-party measurement solutions across the full funnel.”

But, even though Spotify reported higher growth in revenue during the initial quarter of 2014 compared to previous quarters, the company did not meet its earnings growth and revenue projections.


Additionally, Spotify’s gross margin fell by 3% in the first quarter. Spotify declared that the decrease “reflects improving ad-supported music and podcast profitability, offset by higher another cost of revenue.”

In reality, Spotify also revealed that it would end the exclusivity of Gimlet original podcasts. Gimlet original podcasts will also offer the same podcasts across different streaming platforms.


“Given our status as the world’s leading podcasting platform, we’re broadening our strategies for windowing to grow the number of listeners and the sales capacity of our show. In this instance, we’re seeking the broadest distribution of some of our original podcasts, such as Science Vs. The distribution will be handled case-by-case and as time goes on,” said the company in an announcement.


“Our approach to selling these podcasts will not change while advertisers will benefit from additional audience reach,” said a Spotify spokesperson.

Naturally, the reality is that according to what Bingham said, “you’re connecting with people as they stream what they love, choosing this based on their mood or moment.”

Furthermore, Bingham said that the company was working on new ways to ensure precise ad performance.


“Our products are created to ensure that we provide precision and transparency to our customers. That’s why Spotify’s SAI has revolutionized the industry in our view. Advertisers can verify real-time impressions while listeners stream their podcasts through Spotify. SAI allows digital planning as well as reporting and measurement for podcasts. It provides the metrics for campaigns and insights into the audience from confirmed impressions of ads,” he explained.

Advertising on podcasts and audio isn’t finished, but at Spotify, the company sets its clients up to succeed.



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