Dentsu’s Zac Selby (National Programmatic Solutions Lead) and Daniella Kenney (Head of Digital Partnerships) were special guest panellists at the IAB Audio Summit 2023 held in Sydney (Wednesday 1st March) and Melbourne (Monday 6th March) this month. The event provided attendees with information and inspiration on the streaming and podcast advertising market.
According to the IAB’s Australian Online Advertising Expenditure Report 2022, the total Australian online audio ad market in CY22 was $221.2M representing 4% of total general display ad expenditure. Podcast ad expenditure reached $82.5M, while streaming ad expenditure totalled $138.7M.
Zac and Daniella shared their perspectives on the reasons behind the growth of streaming digital audio advertising, the challenges around measurement, and what they see as the future opportunities in this fast-growing space for advertisers.
Below are some highlights from their panel discussions at the event:
According to the State of the Nation report, 75% of media agencies now have streaming audio digital advertising and 70% have podcast advertising as a significant part of their activity. What are the contributing factors that have led to this growth?
Zac: “The continued growth of the medium is due to its incredibly easy ability to be consumed while multitasking. From an investment standpoint, advertisers now firmly understand the role audio plays in the media mix, planning teams are utilising it more frequently due to it’s competitive rates versus other upper funnel mediums and vendors are recommending it more frequently due to their understanding of it’s strengths.
Daniella: “I would say it is strongly aligned to the growth of the medium itself with consumers. As audiences find other ways to entertain and educate via music streaming and podcasts, brands need to be there to engage with their customers.”
The State of the Nation report shows that programmatic is the fastest growing buying method for audio advertising with 82% of agencies intending to buy audio programmatically in the next year, up 64% from the previous year. Why do you believe this is?
Zac: “There is simply a greater ease of access for media buyers. Publishers have made more inventory programmatically tradable, and there is now more integrated supply within buying platforms. What’s great about programmatic beyond the addressability and omnichannel benefits, is the increased visibility and accountability of the buy. By placing a pixel on site, we can unlock advanced reporting and attribution, enabling ROI to be calculated for the audio investment.”
Daniella: “Digital audio as a channel is relatively still quite new for most media buyers, and programmatic trading always takes a little longer to be adopted. Agencies need to work out the value and capabilities of the channel before it scales, which I would say will be this year. The Media Owners have worked on their side to ensure the supply is there, it is now up to the agencies to match the demand.”
The report shows that the top barriers to further investment into audio include lack of measurement and tracking metrics, lack of evidence of effectiveness and lack of addressability. What are some of the initiatives the industry could take to address these challenges and make it easier for buyers to activate audio advertising?
Zac: “As an industry, we need to champion more ROI and attribution reporting best practices when it comes to measurement. This will help justify investment in this space. We also need to try to remove cost barriers to meaningful metrics such as brand lift studies so less advertisers are priced out.
While audio is slightly behind some other digital channels currently, it’s generally activated contextually or with first party data overlay due to logged in users. This means it’s future proofed, which is somewhat underappreciated today but in 12 months’ time when all cookies disappear, it could be seen as a gold standard channel.”
Daniella: “The industry needs to remember audio has evolved from radio, this channel has already proven its value in the media mix. The addition of digital and programmatic trading has allowed for additional capabilities, however we shouldn’t default to expecting the same level as standard digital channels. Buyers should to take a step back and consider how audio can build on traditional methods, and ultimately support in delivering client outcomes through a broader omnichannel plan.”
Where do you see the future trends, what are you most excited about?
Zac: “I’m excited about smart speakers being included in the advertising mix; however, it is likely still a few years off. Beyond increasing the mediums consumption levels, there could be some interesting ways we could deliver ecommerce integrations with ask to buy speech prompts.”
Daniella: “I am excited to see how the tech advances from a consumer perspective. With the increase of digital audio enabled cars on the road, and the number of smart devices in homes we can expect audience consumption to continue growing. As a result, I would expect media buying capabilities to evolve. I am excited to see how brands will be able to engage in a meaningful and beneficial way with the listeners.”