Broadcast radio reaches 92% of Americans according to Nielsen and Edison Research says 51% of Americans have listened to a podcast. It’s why the buzz at this week’s Advertising Week in New York is that audio is experiencing a “resurgence.” Ad dollars, while growing, may not yet be pouring in as quickly as most media companies would like. But one agency executive says that may only be a matter of time.
“The audience always gets out in front of the advertiser,” said Rob Davis, Head of Digital for Ogilvy USA. “So while I’m seeing money start to move, I’m not worried because I see where the audience is at and it’s a natural. It’s going to follow.”
The evidence of that may already be in hand. Ad giant Magna reported that its data shows audio ad spending increased 2.4% during the first half of the year after showing no growth in either 2017 or 2018. And digital sales for audio companies surged ahead 12% during the first six months of the year. It’s podcasting that Magna is most bullish about. “As a quarter of all Americans are now listening to podcasts weekly, more and more major consumer brands are taking notice and starting to include podcasts in their audio campaigns,” said Magna in its fall update. “National brand’s ad dollars, adding to the core podcast users (DTC and direct response), will help increase ad sales by +27% in 2020 to $850 million,” it said.
Greg Anderson, Managing Director of WPP’s programmatic sales unit Xaxis Media Group, says there’s no denying that more dollars are getting shifted into audio as he’s seen more of their clients try to figure out how audio will work in their media mix. Speaking at a panel this week, Anderson said Xaxis has had “great success” in getting more marketers to add audio elements and he thinks that effort will expand in 2020 either through standalone campaigns or those that complement other media buys.
“We’ve seen growth. It’s still not enough,” said iHeartMedia EVP Rahul Sabnis, who serves as Chief Creative Officer of TheStudio at iHeartMedia. “If you look at the overall media budgets against the consumption it’s greatly misaligned,” he said. Sabnis thinks audio companies have positioned their products as either broadcast or digital in recent years rather than presenting marketers a holistic picture. “But it’s going in the right trajectory,” he said. “More smart speakers and more passion to podcasting where there’s amazing craft going on will just accelerate the speed it grows,” said Sabnis.
Anderson said to make audio appealing to clients, Xaxis is pushing them away from media metrics like completion rates and brand lift scores to its proprietary Custom Outcome Indicator which scores a media campaign based on the marriage of sales data and the various touchpoints of the ad campaign. It means that Xaxis should be able to link audio ad exposure and purchase actions. “We’re trying to shift the conversation away from media metrics to something that’s more custom, because every brand has its own challenges,” explained Anderson.
That may be helpful, but Davis said audio still needs to live up to the standards that video faces, ranging from ad completion rates to what website someone went to next. “I want to know about engagement,” he said. “Everything else will take care of itself if we’re engaging the audience.”
Fresh Focus On Audio Creative
The need to capture listener attention is why so much attention is being placed on improving the quality of audio ads. Sabnis, an ad agency creative veteran who was recruited by iHeartMedia two years ago to work with agencies on their audio ads, said one of his biggest frustrations is many marketers just don’t put the effort needed into audio. “There are these lost scrolls of knowledge about how to write for audio,” he said. Sabnis said the best example of a category wisely using radio is insurance with snappy ads from Geico and Liberty Mutual. “They spend the most creatively to capture and engage your mind. They have to because that’s what they’re selling. It’s all about staying top of mind,” he said.
Davis said he’s most intrigued about using live-read ads for Ogilvy clients. “There is something about that in the audio environment. It’s so personal and so specific,” he said. “I don’t want to hear Alexa read something to me but I’ll listen to a podcast host read something to me day or night.”
Sabnis said it comes down to the trust and credibility that audio hosts build with their audience. It also gives them leeway to have fun with a spot, pointing to Charmin toilet paper commercials created for Procter & Gamble for The Ron Burgundy Podcast as a way to leverage the content’s tone to a brand’s advantage.
Davis agreed and said he finds what’s happening in audio exciting. “It’s partly because we’re going back to redefine these older arts,” he said. “And part of it is that we’re taking everything else we have learned in other digital media and applying it a new way to audio.”