Digitalization of audio advertising leaps forward in new deals from iHeartMedia, Pandora's AdsWizz
- IHeartMedia has signed an agreement to acquire Jelli, the company that powers the radio broadcaster's SoundPoint programmatic platform, the company announced via a news release. "Expressway from Katz," a programmatic ad buying exchange for radio groups, will remain independently run by Katz and powered by Jelli.
- The acquisition will help iHeartRadio leverage Jelli's platform to help brands with programmatic buying and selling of broadcast radio inventory. The platform includes targeting and creative optimization based on data and attribution tools.
- In separate news, Pandora's digital audio ad solutions firm AdsWizz announced that it, along with global audio marketplace AdWave, have been integrated with Google Display and Video 360, according to a news release provided to Marketing Dive. The integration opens music streaming platform Pandora to audio ad buys via Google Display and Video 360.
These developments reflect how digital technology is innovating ad buying for traditional broadcast radio through programmatic buying as well as further streamlining and enhancing ad buying for internet radio. The news comes at a time when the digital audio advertising market is growing as consumers spend more time listening to podcasts and streaming music on their mobile devices and as the adoption of smart speakers continues to grow. While radio ad spending is expected to be flat in 2018, digital audio ad spending is expected to grow again this year following a jump from $1.1 billion to $1.6 billion between 2016 and 2017, according to research cited by eMarketer. To date, programmatic buying has not been a big factor in audio advertising, per eMarketer, but the news from iHeartMedia and Pandora's AdsWizz suggests this could be changing.
IHeartMedia's acquisition of Jelli will help it expand its digital advertising offerings and enable brands to better target consumers. The move comes as other audio companies are snapping up ad tech companies, including Pandora, which acquired AdsWizz in March, and Spotify purchased MightyTV last year, according to AdWeek.
Audio companies are hoping to lure advertisers with streamlined programmatic buys, as marketers are looking to reach the growing number of subscribers of audio streaming platforms. The global music streaming market is projected to grow 19.8% CAGR through 2026, according to Persistence Market Research. By 2019, programmatic spend on "traditional" formats, like TV, radio and out-of-home, will make up 6% of the total and is expected to hit 13% or $13 billion, according to Publicis Groupe Zenith estimates.
With more consumers embracing smart speaker technology, marketers have been looking for ways to leverage the devices, and iHeartMedia's acquisition and AdsWizz's Google integration could create new opportunities. Nearly a quarter of U.S. homes contained a smart speaker device at the end of Q2 2018, and about four in 10 homes had two devices, according to a Nielsen Research MediaTech Trender survey. Forty-five percent of smart speaker owners plan to buy more devices. This holiday season, the devices are expected to be a popular gift item.