While rumors of a streaming music service from Apple and Google have been prevalent lately, few expected the announcement last week that Twitter is developing a mobile music application that will let its users play and share songs. Last year, Twitter acquired the music recommendation website We Are Hunted, a site that charts the 99 most popular songs on a daily basis by tracking what the web has to say. It was a perfect match for Twitter, since it was a music discovery site already built to keep track of what music listeners were talking about and sharing on Twitter and other sources.
The new app, called Twitter Music, could launch by the end of this month. Various reports say that Twitter Music will suggest artists and songs, based at least in part on what a person follows on Twitter. Songs will be streamed via SoundCloud, which seems to be a perfect streaming partner. It’s easy to imagine the success that an application like this can have, given the popularity that lots of recording artists have on Twitter. Artists can offer their music on SoundCloud and spread the word on Twitter directly to followers.
Probably not coincidentally, SoundCloud has revamped its fee structure, making it easier for artists to open accounts and offer their music easily to fans. An enhanced Pro subscription also offers the ability to run ads, which they call “Moving Sounds.” Based in Berlin, SoundCloud has over 180 million users per month. It’s one very interesting streaming platform that is more focused on delivering quick hits – like songs and soundbites, than longer, radio station like experiences. Which is of course, entirely compatible with the way online consumers like it, on Twitter and Facebook, Instagram and Tumblr…
Dial Global this week announced a partnership with SoundHound that will offer advertisers more interactivity with broadcast radio listeners. SoundHound is a music app that listeners can download to their mobile devices and use to identify songs. Now, advertisers can offer listeners access to exclusive offers and branded audio, video, and Web content delivered on their mobile device through SoundHound.
With this new technology, advertisers will have the ability to provide additional information to consumers via a “second screen” portable device – enhancing the interactivity of their radio campaigns. Reportedly, the consumer does not have to interact with a commercial immediately in order to tap into the “second screen” offering because the information will remain available for a period of time.
As lifestyle shifts toward mobile continue, technology that enables radio campaigns to benefit are essential. eMarketer forecasts the number of mobile shoppers in the US will increase by 24% in 2013 to 118 million consumers and represent 62% of digital shoppers. Over the next four years, the overlap between mobile and digital shoppers will steadily increase as the number of mobile shoppers grows to 174 million in 2016, 80% of all online shoppers.
Mobile interactivity both increases the impact of a campaign as well as the ability to quantify effectiveness. “Until now, radio has struggled to keep pace with the kind of measurable engagement offered by newer digital marketing platforms. Together with SoundHound, we have created a marketing solution that delivers trackable engagement between listeners and brands.” said Ken Williams, President of Dial Global.
Abacast has announced a new cloud based ad insertion technology that offers significant enhancements to streaming broadcasters. Generally, broadcasters deliver their online audio product in a single stream where all listeners are hearing the same thing at the same time. This is different than the technology that more interactive services like Pandora use, where each listener is hearing a personalized stream. The single stream approach, while cost efficient, has offered limited targetability of ads. With Abacast’s patent pending cloud-based ad insertion, each listener can receive individualized in-stream audio ads.
ESPN’s Digital Audio division will use the system to enhance the targetability of audio ads across its platform, “targeting listeners by device, location, age and gender in real time across live national broadcasts.” Abacast’s targeting capabilities make it possible to choose options that, for example, include “all smartphone listeners,” “all listeners in the top 20 DMAs that are on iPhones,” “all male listeners in the 25-34 age range in a group of zip codes,” “all listeners listening on the TuneIn player,” and more, according to Rob Green, Abacast CEO. Abacast’s cloud-based ad insertion is specifically designed for all broadcaster sizes and is deployed on the Abacast streaming network as well as on Akamai and Amazon.
“This was a huge hole in the radio industry,” ESPN Digital Audio senior manager Blair Cullen told Adweek. “Before, it was one stream to thousands of people, and it didn’t make sense that we were targeting women with a lot of the ads that were running. Now, hundreds of thousands of people are going to get different ad breaks. You could be in the same car as your friend wearing different headsets, and you’ll still be served a different ad than that person,” he said.
This is impressive news from Abacast that has game changing potential for single stream broadcasters with large, geographically or demographically diverse audiences. More targeted ad delivery nets higher cpms, and positions those services to better compete for digital dollars.
This morning’s Inside Radio reports that Hubbard owned WTOP will no longer insert ads in its streams, opting instead to simulcast 100% of its broadcast programming online. This is a decision made earlier this year by small market broadcasting group Saga Communications, who at the time blamed imperfect ad insertion technology for its decision.
The biggest reason that a broadcast company would opt to simulcast 100% of its programming rather than inserting different ads into its stream would be that Arbitron will only measure the online audience and the on-air audience as one if the station simulcasts the exact same thing on the stream as it broadcasts. There’s nothing wrong with Arbitron’s thinking in this regard – it would be flawed for them to represent the two audiences (streamed and broadcast) as one if the programming were not completely identical. That would be misleading to advertisers who might look at the combined audience number and conclude that their commercials achieved that reach when they had not.
WTOP is up front about the reason for its move. Inside Radio quotes SVP/GM Joel Oxley : “Since WTOP is now a simulcast, those listeners can now be added to our Arbitron ratings,” he says. “For WTOP even a slight move up in ratings can mean a significant rise in revenue.” For the top billing radio station in the country, that can make a big difference.
This move by WTOP signals a growing interest by broadcasters in blending their audiences into one to create ratings uniformity. It’s a clear decision to sell the audience as one, rather than two separate audiences. It makes sense in some ways, but there are problems as well. Ads created for over the air listeners often have a call to action like “Call this number” while ads that are streamed should have an online call to action. As well, streaming ads have more targeting and tracking capabilities than broadcast ads do. But times are tough and revenues are down. Broadcasters, like everyone else, are forced to take a hard look at their options and in a case like this prefer the one that promises a more immediate uptick for revenue.
Fred Wilson, a partner in the investment firm Union Square Ventures, is a music lover and his company is invested in several companies in the streaming audio space including SoundCloud, Turntable.fm, and Targetspot. Wilson has been thinking and talking about monetization of streaming audio services, and his ideas are worth repeating.
In a recent interview, Wilson talked about advertising as a revenue model for streaming services. He sees the radio advertising market, pegged at $17 billion, moving online as listeners transition more and more to listening on smartphones. As that happens, services like Pandora, Rdio and Songza benefit, but so do artists.
In his blog post this morning, Wilson writes about online ad revenue models, and it’s a very interesting post for anyone in the business. He outlines the complexity of the online ad marketplace, and concludes that scale is a very important factor for success in the advertising revenue model. Dollars are limited, and with more and more services going after them, rates are dropping.
Pandora is certainly the service that is best positioned to test this out – they have the scale and are aggressively pursuing an ad revenue model. Each time they gain a dollar in advertising from the general $17 billion radio revenue pool, artists win too, because they get paid for music played by Pandora, but not for music played by broadcast radio. Right? So that means the artists and their labels should want online services which are pursuing ad revenue models to succeed, doesn’t it? Just sayin…
Recent moves by Katz360 and Triton Digital indicate that the streaming audio marketplace may be heating up, with new players signing up to have those firms sell their inventory.
Triton Digital recently announced a big deal with Microsoft to sell audio ads on their Xbox Music streaming platform. Microsoft intends Xbox Music to be the platform that their customers use to listen to music, calling it a 30 million-song global catalog powered by the one service that integrates your music experiences across your tablet, PC, phone and tv. Triton Digital will sell ads and provide analytics for the service.
Now, this is a big deal for Triton, one that could easily change the focus of their entire sales organization, not to mention the streaming audio marketplace, creating a lot more highly targetable inventory.
At the same time, Katz360 is changing things up as well. First came the announcement that Brian Benedik was leaving, followed by an announcement that Mort Greenberg would be the new President. Greenberg, who was formerly head of sales at Nokia, apparently brought a deal to sell Nokia ad elements, and at least some of his sales team from Nokia, with him to Katz360. According to his Linkedin profile, the plan is to rebuild and rebrand this digital unit (Katz360) as a leading global local & location interactive ad Network and representation firm.
So, a couple of big deals that could have a huge impact on the streaming audio ad marketplace, increasing the inventory, level of targetability, and opportunities for advertisers, not to mention the level of sophistication of the sellers. I’m thinking this is all a very good thing indeed…
In the states where the races for the presidential election were the closest, radio advertising made the difference. According to an article in Politico last week, both candidates used radio to target specific segments of the population, with Obama spending quite a bit more than Romney. The article, which is also very nicely summarized by Fred Jacobs in his blog, notes that the campaigns saw radio as a way to reach voters who were not extremely political and might not be tuning into polls on a daily basis. As well, radio ads were a strategy for reaching busy younger adult women who spend lots of time in the car tuning in.
A nifty infographic that TuneIn, the Internet radio portal, sent me shows that voters likely to favor Obama were indeed listening to radio. Radio was a key strategy for the campaigns in swing states, with the Obama campaign airing a series of tailored radio ads for eight key states, targeting Paul Ryan, including specific ads relevant for Virginia, Colorado, Florida and Nevada starting in August, and Romney using swing-state radio ads to knock President Obama over his ” bayonets and horses” quip during the final presidential debate.
TuneIn looked specifically at how many listeners were tuning into political talk programming during the month of October and found more listening to liberal (so-called) democratic programming. Indeed, their data, which they sent me on Monday, largely predicted the outcome in most of the key swing states…
Coca-Cola’s efforts to target teens in South and Central America include a personalizable streaming platform, Coca-Cola.fm. While it is not available in the US, Coca-Cola.fm apparently targets teens, according to the press release: Coca-Cola.FM is a platform through which teens can also develop their own creations — a radio station in Mexico on which they can talk, be listened to and communicate with the world through their musical preferences.
The station is also available in Brazil, where an innovative new marketing effort has just been released. With the help of ad agency JWT, they’ve turned the cover of popular teen magazine Capricho into an ad for the streaming platform that turns into an iPhone speaker. Watch this…
Listeners are not just embracing Internet radio, they are also enjoying its advertising component, according to a new white paper released by Targetspot today. 42% of the population is listening to Internet Radio, which is up 8% from 2011. What’s more, these listeners are engaged in ways that benefit advertisers – 67% often check the player to see the name of a song or artist, 57% of Digital Audio listeners actually buy products online and 56% research products for future purchase.
Digital audio listeners are “highly accepting” of targeted advertising – 65% are comfortable receiving ads based on their profiles, and 70% are comfortable receiving messages that target them based on their usage and content selections. And they respond to those ads: 58% of Internet Radio listeners recall having seen or heard an Internet Radio ad in the last 30 days; up 12% from last year. Of those who recalled an Internet Radio ad, 44% responded to it in some way, up 10% from last year.
Based on this study, digital audio platforms present an excellent value proposition to advertisers: engaged listeners who like targeted ads and respond to them. Kudos to Targetspot for sponsoring this study, and then sharing it with the industry…