It’s Time to Take Digital Audio Advertising Seriously | Adtaxi

It’s Time to Take Digital Audio Advertising Seriously


Jennifer Flanagan

Jan 11 2022

It’s natural to apply the wait-and-see method to any new marketing strategy, especially when budgets are tight. So it’s understandable if some marketers haven’t fully investigated digital audio advertising yet.

However, it’s time to embrace this tactic. Not only because people perceive this type of ad to be shorter in length or because consumers describe digital audio ads as “more relevant, more attention-grabbing and more entertaining,” though that’s all great. It’s because your audience is actually responding to digital audio, so you should be, too.

In this post we’ll discuss where digital audio advertising currently stands, how it’s changing, and why you should consider adding digital audio to your marketing mix (if you haven’t already).

The Current State of Digital Audio Advertising

According to a forecast from eMarketer, “Combined, US radio and digital audio services will receive $16.80 billion in ad spending in 2021.” Of this total, $5.59 billion went to digital audio, with digital audio’s share of ad spending expected to increase through at least 2025.

With so much money going toward digital audio, it’s important to know who’s hearing these ads. A study from Edison Research and Triton Digital offers some insight:

  • Around eighty million Americans (or 28% of the U.S. population over age 12) are weekly podcast listeners.

  • Approximately 62% of that same population (or 176 million people) listen to some form of online audio on a weekly basis.

eMarketer also reports, “US advertisers will spend $1.33 billion on podcast ads this year, a 38.7% year-over-year (YoY) increase.” With an estimated 120 million podcast listeners in the U.S. alone as of 2021 (forecasted to grow to over 160 million by 2023), developing a digital audio advertising plan is crucial.

The Evolution of Digital Audio Ads

Despite gaining popularity, advertisers have been reluctant to devote large portions of their marketing budget to digital audio ads. This is largely due to “lack of measurability, innovative ad formats and programmatic options,” according to Forbes.

For example, SiriusXM Media’s Lizzie Widhelm notes that SXM Media currently helps advertisers “topically target” listeners and gather gender and geographic information. While it’s a good starting point, she acknowledges that advertisers still need better tools for measurement and access to more segmented audience data—essentially, the retargeting data they get with traditional ads.

Other popular platforms, such as iHeartMedia and Spotify, are testing innovative ad formats. Pandora began beta testing interactive voice ads for a small selection of brands in mid-2020. With the number of paid digital audio subscribers at an all-time high in the U.S., brands must find strategic ways to utilize digital audio advertising.

Making Digital Audio Advertising Work for Your Brand

Digital audio advertising is important for two key reasons: audience reach and segmentation.

Audience reach

People can stream audio from anywhere; the same can’t be said for video. (Just imagine trying to stream and watch a video ad while walking down a crowded sidewalk. Not ideal.) Audio advertising extends your reach with its easy accessibility.

Adding to the power of digital audio: smart speakers. According to Edison Research, “One-third (33%) of Americans 12+, approximately 94 million people, now own a smart speaker, an increase of 22% from last year and nearly five times what it was in 2017 (7%).” Smart-speaker usage also opens up the possibilities for voice search.


Once the right ad finds them, people are listening—and taking action. Research shows, “Almost six in 10 [people] say that podcast ads are more likely to make them consider buying from a brand or a specific product.”

Digital audio advertising is working toward offering more in-depth retargeting data, but there’s plenty of good information you can utilize to create your audience segments now. Studying the audience demographics of popular streaming platforms can help marketers reach their target audience, even as measurement and segmentation data continues to improve.

Not everyone has the budget to buy ads on Spotify, but you can still take advantage of digital audio advertising. Start small by optimizing existing content for voice search, then eventually expand into buying ads on podcasts that are relevant to your audience. As you gather data and adjust your budget, consider creating an in-house podcast or investing in interactive voice ads.

Prepare Your Ad Strategy Now for Future Growth

Statista’s Advertising
& Media Outlook
forecasts that digital audio will reach almost as many listeners in the U.S. as traditional radio advertising (215.4 million vs. 221.9 million) by 2025. As of 2021, traditional radio outpaces digital audio, 217 million to 169 million. Seeing this much potential growth on the horizon indicates that ad budgets will increase accordingly.

Marketers should expect digital audio ad spending to hit $6.76 billion by 2023 and $7.89 billion in 2025. Based on those numbers, digital audio ad spending would make up over 36% (in 2023) and over 40% (in 2025) of the combined total spending on radio and digital audio ads. And those numbers have the potential to grow as programmatic ads become easier to incorporate into podcasts and other streaming audio.

Digital audio advertising has evolved beyond its experimental phase into an essential marketing component. As more people use smart speakers and multitask while streaming podcasts and music, digital audio advertising will become an even more important part of a strong digital strategy.

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