The space can unlock newer capabilities if audio platform providers can innovate more
Due to the abundance of free audio options, just three million people purchased music subscriptions in 2021, producing Rs 1.6 billion in revenue. Image: Shutterstock
Parikshit Sharma, 19, is an avid Spotify user whose day starts and ends with listening to music, podcasts and audio streams on the platform. He is not a subscriber of their premium package. “I don’t mind the ads as long as I’m getting my daily dose of music and podcasts,” claims Sharma.
Sharma is a classic consumer case for a wide variety of brands including categories such as smartphones, confectionery, dating apps, and video streaming platforms that are tapping the Gen Z and millennial consumer base (18 to 35 years) on audio streaming platforms serving smart, customised, programmatic ads. To be sure, there’s enough data on how well programmatic advertising works on videos and display, though audio is slowly yet steadily picking pace as well.
A joint report by EY-FICCI on India’s M&E sector published in March states that the share of programmatic advertising increased from 10 percent of total digital spends in 2017 to 42 percent in 2021. The digital media segment grew 29 percent to reach Rs 303 billion in 2021 and it is expected to grow further at a CAGR of 20 percent over the next three years to touch Rs 537 billion.
“Programmatic advertising is now extending its remit to sectors such as audio OTT, DOOH, and we can expect to see several platforms come into being to serve even traditional platforms like radio and regional television in future,” the report notes.