IAB's latest audio advertising report paints dynamic picture of streaming digital and podcast take-up

Growing role of digital audio advertising for brand building, increased progammatic buying and a changing measurement landscape all highlighted in latest research report

Streaming digital audio as well as podcast advertising are both playing increasing roles in brand building, yet under half of advertisers are consistency using an identifiable sonic logo or audio asset in their creative mix.

That’s just one of a number of findings from the Interactive Advertising Bureau (IAB) Australia’s sixth annual Audio Advertising State of the Nation Report survey, undertaken in partnership with Hoop Research Group. The emphasis is on agency respondents as well as those focused on those allocating marketing spend on audio campaigns. The survey covers broadcast radio, streaming digital audio, DAB+ and podcasting

During today’s IAB Australia Audio Summit, director of research, Natalie Stanbury, highlighted a number of key report insights.

Overall, usage of digital audio advertising has consistently grown over the past six years. More than seven in 10 agencies (73 per cent) either significantly use streaming digital audio services or regularly consider them as part of activities, up from 69 per cent a year ago. Nearly six in 10 (59 per cent) regularly consider podcast advertising, up from 36 per cent from last year.

For the first time, the IAB report broke down podcasts into original content and catchup radio, finding both were regularly considered by agencies (53 per cent and 41 per cent, respectively).

A growing desire to buy audio advertising programmatically is also rising. The report found 64 per cent of respondents intend to use programmatic means for audio advertising over the next 12 months, with buying both on open exchanges as well as private marketplaces increasing significantly over the past year.

Reasons to use programmatic are changing too. According to IAB’s finding, while data and targeting is still the dominant use case (83 per cent), more advertisers are embracing programmatic for flexible buying options (80 per cent, up from 52 per cent in 2020) and operational efficiency (70 per cent, up from 56 per cent in 2020). Only 29 per cent are using programmatic to utilise client data, while 44 per cent cited price as a deciding factor. 

The report found digital audio has continued to increase its role as a brand building tool, with 87 per cent of media agencies using streaming digital audio advertising for this purpose, up from 75 per cent the year prior. In addition, 84 per cent are using podcast advertising to increase brand awareness, up from 65 per cent in 2020. 

Yet even with these strategic brand objectives, the IAB found only 46 per of those with experience in audio advertising consistency use an audio or sonic logo as a branding asset in their creative (46 per cent) and only 24 per cent employ a brand anthem. A further 41 per cent were not sure they even had a brand anthem.

What's more, even with this brand imperative, use cases for audio advertising are increasing through the funnel. For example, nearly six in 10 are using streaming digital audio advertising to support specific promotions (57 per cent) and more than one quarter to increase keyword search activity (26 per cent). This contrasted with 64 per cent using broadcast radio in all its forms for brand awareness, 65 per cent for specific promotions support, and 28 per cent for increasing keyword search activity.

The IAB also found growth in the number of respondents planning and buying audio advertising in combination with other digital advertising channels. The most common combination is with digital display (65 per cent), followed by digital video (59 per cent). The sharpest rise was buying audio advertising alongside digital out-of-home (45 per cent in 2021, up from 31 per cent in 2020).

What's holding digital audio advertising back

Measurement remains a challenge, particularly when it comes to weighing up audio advertising alongside other digital channels. The IAB found lack of measurement or standardised metrics as the top barrier to spending more on audio advertising both across streaming digital audio and podcasts. This had reduced slightly over the last three years for streaming digital audio advertising (36 per cent to 33 per cent) but increased slightly as a barrier across podcast advertising (47 per cent to 52 per cent).

By comparison, lack of evidence of effectiveness dropped slightly as a barrier in both formats over the same timeframe. This was replaced instead by growing concerns around integrating audio advertising measurement into wider campaigns.

The most common measures being used to gauge advertising effectiveness across streaming digital audio are reach, frequency, in-target reach, completion and visit to a website. The top five ways to measure podcasts meanwhile are completion, visit to website, brand impact metrics, reach and frequency.

“Considering a core objective of campaigns is brand building, brand metrics are still underutilised on a consistent basis,” Stanbury commented, pointing out brand effectiveness metrics are only used by 24 per cent of media agencies for sixing up streaming digital audio and 36 per cent for podcast advertising.  

And while agencies expressed interest in opportunities for greater integration of streaming digital audio and podcasts with other audio channels and into cross digital campaign campaigns, Stanbury noted only 40 per cent of media agencies reported planning and buying all audio activities within the same team. This was down from 51 per cent last year.

“The removal of planning and buying silos, along with standardising measurement and increasing the supply of omnichannel programmatic inventory were all identified as areas for growth in 2022,” Stanbury said.

Usage of podcast creative formats all increased, led by growth in radio recorded spots, brand ads and native audio. Client-produced 15 or 30-second spots was most popular streaming audio format (84 per cent), followed by publisher produced spots (67 per cent). Dynamic creative and voice-activated creative rose slightly to 27 per cent and 11 per cent, respectively.

At the same time, IAB reported a reduction in frequency of adjusting creative to suit specific audio environments. For instance, in previous years, 64 per cent of agencies at least sometimes changed the creative to suit particular audio environment. This reduced to 56 per cent this year.

IAB Australia CEO, Gai Le Roy, wasn’t surprised to see marketers expanding their use of streaming audio from brand building to supporting short-term objectives to drive sales after a year when lockdowns kept changing consumer purchasing behaviour.

“It is also great sign of a maturing market to see a reduction in the number of agencies citing lack of effectiveness proof as a barrier to investment in digital audio,” she commented.

The Audio Advertising State of the Nation Report is supported by 15 media and tech companies, as well as industry body Commercial Radio Australia. In all, 198 survey responses were recorded between December 2021 and January 2022.

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