Can you tell by someone’s music taste what kind of car they would buy? Is it best to advertise to music fan’s ears or eyes? How about advertising to listeners in the shower?
Spotify, one of the top music sites, last week announced a partnership with AppNexus, Rubicon Project and The Trade Desk that will enable highly targeted Deal ID/PMP audio ads to serve to the 70-million, mostly young users of Spotify Free. Clients can use 15- or 30-second audio spots, and use first-party data to target by music genre, age, gender, playlist choices and various other demographic factors. Spotify had previously been offering a programmatic solution based on display ads and video spots.
This makes sense because, if I base it on how I use Pandora and Spotify, visuals are not the point. Who looks at Pandora when you’re playing it, especially on a PC? Spotify has display ads from the likes of clients like Aetna but, as they explain, watching Spotify isn’t really what people are doing. AppNexus quotes Nielsen estimating that “79% of audio consumption takes place while people are engaged in activities that make it impossible for them to engage with visual media.” That leaves an enticing possibility, but let’s leave salacious thoughts out of this story.
Although Spotify didn’t want to release client names, I heard a :15 Sam Adams beer spot, which seemed like the right length for this type of ad. Another ad was for the travel service Kayak. The ads I heard were spoken word, and avoided the shouting intensity of many radio ads, which is why I stopped listening to commercial radio, not to mention the podcasts with 15 spots in a row that make much of them unlistenable. I also heard local Florida targeting, a spot for Jacksonville State University. I grooved to Spotify’s Pop Chillout, which played a lot of songs I like. Because of Spotify, I now know and love The Brinks and Arizona’s “I Was Wrong.”
Les Hollander, global head of audio monetization at Spotify, told me his service is 90% subscription supported; advertising accounts for the other 10%. But 70% of its audience listens to the free service, so currently 30% of the audience is paying most of the bills at Spotify. The plan is for that to change. Spotify wants to avoid ad overkill, with Hollander noting that that the audio ad load “will be lower than that of other publishers.” I heard an ad after about five songs, which is a lot less than any radio station, and it was just one :15 spot. No clutter here, not yet.
Maybe Spotify doesn’t know as much about you as Google does, but it knows things Google doesn’t. I suppose we should have known this when the shower radio was invented, but a lot of people listen to music in the shower. According to Hollander, a breathtaking 800,000 Spotify listeners have created shower playlists. And while they’re powering those up, it’s a perfect opportunity for bath product advertisers to hit them where they bathe. There are also a lot of “barbecue” playlists? Steak sauce ads would come to mind.
According to company data, 80% of Spotify’s users wield a mobile device. And this ad opportunity is aimed straight at the radio audience, or what used to be the radio audience.
“While radio listening activity overindexes in the morning, Spotify listening builds steadily throughout the day, peaking in the afternoon and early evening,” the company asserts. Spotify claims that its “average cross-platform” users average 148 minutes of listening per day.
Spotify’s Hollander notes that many people now just listen to radio in the car. “When was the last time you saw a boombox?” he asks. While Spotify, Pandora and other such services are carried around with mobile devices throughout listeners’ days.
How reliable is someone’s music taste in targeting potential clients? Notwithstanding that politicians like Donald Trump and George Bush keep using songs that the artists don’t approve of, it’s difficult to predict what music turns somebody on. But combine that with detailed demographics, and you have something interesting.