If You’re Following the Digital Ad Dollars, The Future is Audio
You no longer need to worry if the growth in CTV will make up for the losses of TV. Because there is another medium roaring above all else: Audio. Revenue in the U.S. digital Audio sector is expected to reach $18B by 20261. Factor in reach, investment, and adoption rates, and it’s clear that Audio will be the dominant digital medium.
Audio reaches everyone. In fact, 99% of U.S. adults report using Audio monthly. That’s more than the total use of TV, including connected devices.2 Audio’s reach is music to marketers’ ears — and it only grows more beautiful when we hear that digital Audio is expected to reach 215M U.S. listeners by 2025.3 By 2026, Statista forecasts there will be 121M free ad-supprted music streaming listeners and 97M free ad-supported podcast listeners.4
It isn’t surprising, then, that Audio revenue is growing faster than video. Per the latest IAB Advertising Revenue Report, Audio streaming revenue is up +59% YOY. Digital Audio’s 2021 growth index eclipses digital video’s. And Audio streaming growth is outpacing investments in video, social and search.
There is tremendous momentum among streaming audiences. Per IAB, monthly podcast listeners are anticipated to grow in the U.S. at a 6.7% CAGR from 2021 to 2025.
Gen Z and Millennials are more likely to stream Audio than video5, signaling that Audio will be the preferred digital medium of the future.
And the Audio streaming audience is highly desirable. High income households (HHI $100k+) are +21% more likely to consume podcast content than stream video.6
What’s a brand to do in this landscape? Close the gap between plans and consumer behavior. Marketing mix is, well, mixed. The TV/video balance has to tilt over to Audio and follow consumers’ lead. In a time when even movie enthusiasts are more likely to stream Audio than video,7 Audio should be an ingrained part of your marketing strategy. A recent study with Neustar on Audio’s Return on Ad Spend (2021) shows that national brands across categories are underinvested in Audio. The soaring growth in Audio listening underscores what a missed opportunity this is. And the same study indicates shifting 1% of budget in a marketing mix to Audio can increase Audio ROAS as much as +23%. Audio investments need to be a balanced act of OTA and digital. Here’s how much national marketers need to dial up their digital Audio.
Increased digital Audio investment by:8
|Auto +1.4%||Retail +0.6%||Financial Services +0.6%||Telecom +0.2%|
Audio is evolutionary. It is no longer just in and out of home. It’s on mobile and desktop and smart speakers. It is in every moment that matters to consumers. To be effective, marketing plans need a boost and deliver Audio’s total and true audience.
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1 Statista Outlook Report, November 2021
2 Nielsen, Q4 2021
3 Statista, Sep 2021
4 Statista Outlook Report, November 2021
5 MRI Simmons, Spring 2021; Scarborough National Database 2021 Release 2 Jun 2020-Nov 2021
6 Scarborough National Database 2021 Release 2 Jun 2020-Nov 2021
7 MRI Simmons, Winter 2022
8 Neustar, Meta-Analysis on Audio Performance, 2021. Shifts in audio allocation are percentage points