Memorable, Trusted and Connecting — Why Digital Audio is Stronger Than Ever in 2021
The US Time Spent with Media 2021 report by Insider Intelligence confirms what any of us could have guessed — the coronavirus pandemic increased our time spent with media. In 2020 the average US adult was estimated to have spent 13 hours and 21 minutes a day on various media formats and devices. That’s an increase of close to an hour over 2019 figures.
For the first time in years, even some traditional media formats like TV and print newspapers bucked their downward trends. However, experts agree that these gains will be short-lived.
But for many, the biggest surprise was the increase in digital audio. It has always been associated with commute times — that’s traditionally when people have listened to podcasts and digital radio. But during the pandemic, when commutes dropped due to stay-at-home orders, podcast listening grew. What’s the attraction of digital audio? How is the format evolving to ensure it remains relevant? And what does it all mean for advertisers?
The Growth of Audio Content
Audio content has been growing in popularity for the past few years, driven in part by social audio. Social audio refers to real-time audio that allows listeners to participate in the discussion. Popular apps like Clubhouse and Discord are examples of social audio.
EMarketer estimates that digital audio made up 11 percent of total media time per day for US adults in 2020 and will grow to 11.7 percent in 2021. Active consumers listen more than two hours a day, but about 70 percent of adults tune in at least once a month, overwhelmingly via mobile (91.7 percent).
Research by Edison shows that for 2021, 62 percent of the US population over age 12 listens to online audio content weekly. This includes online radio and streaming content. Weekly listening averages 16 hours and 14 minutes, compared to 15 hours and 12 minutes in 2020 — a significant increase.
Why Is the Medium So Popular?
As a hands-free, eyes-free medium, audio is convenient. Fans can multitask — such as clean the house or walk the dog — without losing track of content. Plus, improvements in hardware like smart speakers and headphones are making listening and interacting more convenient than ever.
But it’s more than convenience. A groundbreaking study in 2020 by Audacy (then called Entercom) shows how effectively audio captures audiences’ attention and connects with them emotionally. Compared to other media like FAST (free, ad-supported streaming TV), video on demand, traditional TV, and social media, audio ranks as the most immersive media format. It’s also the medium that best triggers memorability, trust, and connection.
Audio disburses with the visual clutter of other media, and survey responses indicated listeners are most influenced by local content and host trust. They regard audio as having better content, often contributing to personal growth. Listeners also associate it with improving mental health.
What Does Digital Audio Mean for Advertisers?
Digital audio has become part of the media mix for both publishers and advertisers. In the UK, the IAB’s 2020 Digital Adspend report included digital audio for the first time. It showed an overall market of 17 percent year over year, and an impressive 43 percent increase in podcast spend. Forbes confirms that podcast ads are fueling digital audio’s growth, pointing out that podcast and programmatic ad revenues were leaders of Spotify’s 22 percent revenue growth, while iHeartMedia saw a 142 percent increase in podcast revenue.
Marketers have been wary of digital audio because it has been difficult to measure and not offered anything innovative in ad formats. But major players are addressing this. iHeartMedia recently launched a private marketplace for its podcasts, and Spotify is focusing its development efforts on its Ad Studio and Streaming Ad Insertion products.
Hardware technology is also enabling innovation. In the UK, cosmetic brand NARS leveraged smart speaker listening when it created the first voice-activated campaign in the UK during the pandemic. It enabled listeners to order delivery of samples when brick-and-mortar stores were closed.
What Are the Challenges Facing Digital Audio?
As marketers hop on board, the biggest challenge facing digital audio is acquiring sufficient exclusive content to keep their listeners and advertisers satisfied. However, there are three content challenges to overcome:
1. Live Audio
Clubhouse clones aren’t going to do it in Spotify’s opinion, and iHeartMedia and SiriusXM have also so far failed to present live audio products. Spotify’s CEO Daniel Ek reckons it’s more about exclusive and compelling content.
2. Scaling Partnerships
One way to scale content easily and quickly would be for audio players to form exclusive content partnerships like iHeartMedia did last year with the NFL.
3. Premium Content Subscription
Apple and Spotify have recently launched premium content subscriptions that give subscribers access to exclusive content. But it’s unclear if there’s a market for multiple micro audio subscriptions. With TV, subscribers stop-start subscriptions to access the content they desire when it’s available — making it more of a rental model. It may be that digital audio premium subscriptions follow a similar pattern.
However players decide to address the challenges ahead of them, one thing is sure, digital audio is here to stay.