Global Audio Advertising Market Size, Share, Opportunities, COVID-19 Impact, And Trends By Medium (Radio, Music-on-Demand), By Device (Smartphones And Tablets, Smart TV, Radio, Others), And By Geography - Forecasts From 2022 To 2027

The audio advertising market is valued at US$31.811 billion in 2020.

Audio advertising is the presentation of advertisements in the form of audio records via internet streaming platforms such as podcasts, music streaming applications, and radio channels. In accordance with the rising popularity of audio, advertising through this medium is also gaining popularity, thanks to technological developments and customer demand. Audio streaming services also saw an increase in users, owing to the COVID-19 pandemic.

Podcasts have also had a significant impact on the audio advertising market, as audiences have started adopting podcasts as their means of media consumption. However, the rise in the adoption of adblockers may prove to be a setback for the audio advertising market and may decrease the overall market demand.

Impact of the COVID-19 pandemic on the Audio Advertising Market

The recent outbreak of the COVID-19 pandemic had a positive impact on the global audio advertising market. With the restrictions and work-from-home norms set up by various governments, the audio streaming market saw a massive increase in users. With an increase in the number of audio users, streaming services increased by 24% year on year in 2021, compared to a 19% increase from 2019 to 2020 and a 22% increase from 2018 to 2019, according to an International Music Summit (IMS) report.

The IMS also noted that the recording music business had crossed the $26 billion mark across all genres, an 18% increase over the previous year. This surge in the number of streaming audiences increased demand for the advertising market.

Advancements in audio advertising

Audio is becoming increasingly appealing for brand advertising since it can be presented in an open environment. Earlier this year, Spotify added clickable cards to its digital audio advertisements, allowing users to act after hearing advertising material. More than 1 million new podcasts were added to Spotify in 2021, accounting for roughly a third of the total podcast inventory (3.2M podcasts). As consumption increases, Spotify aims to make it easier for audiences to understand and interact with advertisements and for marketers to extend their reach.

iHeart announced its plan to launch a new digital ad network earlier this year. The iHeart Audience Network (iAN) will gather advertising content across streaming and podcasting from the iHeartRadio database and other premium publishers. With the debut of the new ad network, iHeart claims that advertisers will achieve scale in their digital audio buys, as well as target addressable audiences across numerous channels, devices, and behaviors to pinpoint the proper audience.

Podcasts gaining popularity

With an increase in the adoption of podcasts as a source of audio consumption, audio companies have reported a considerable influx of users in the genre. Companies have also reported significant revenue generation from audio advertising through podcasts. According to a report by IAB, podcast ad revenue increased by 19% year-on-year in 2020. Despite the pandemic, revenues from podcast advertising increased to $842 million in 2020 from $708 million in 2019.

Spotify's focus on podcasting helped it beat expectations in terms of advertising revenue, which increased 29% year on year to €281 million, as advertiser demand continued to rebound after dropping at the start of the pandemic. Ad income from its podcasts increased by more than 100% year on year, with a 50% rise in the number of sponsors compared to the third quarter.

 Advertising now accounts for a sizable portion of total revenue, accounting for 13% in the fourth quarter. Spotify also announced its multi-year partnership with Harry and Megan, The Duke and Duchess of Sussex, to produce and present podcasts that showcase and promote various viewpoints and voices and inspire audiences through storytelling.

With this partnership, Spotify seeks to strengthen the community via shared experiences, perspectives, and beliefs. With such an increase in the popularity of podcasts, it serves as a ready market for audio advertisements and is expected to drive up the demand significantly.

The rise in the prevalence of ad blockers

Ad-blockers have seen a significant increase in demand among users. Ad blockers protect users from malvertising, maintain privacy and provide a better ad-free experience for users. Moreover, they are usually free to use. According to Block through, by the end of 2020, there were 257 million PC adblockers and 586 million mobile adblockers.

However, the AdBlock rates observed by the most prevalent AdBlock detection approaches only account for around 60% to 80% of total Adblock usage. With 40.6% of consumers using adblockers, Asia leads the AdBlock market, followed by Europe (29.6%), the Americas (19.2%), Africa (9.2%), and Oceania (1.2%).

Ad-blockers like the Brave browser, EZBlocker, etc., filter out ads from audio streaming platforms without requiring premium audio subscriptions from streaming companies. Such an increase in the adoption of adblockers may prove to be unfavorable for audio advertising agencies and companies. 

Key Developments

• May 2022: Veritonic's announced the debut of its audio Attribution solution, which enables marketers to track and evaluate the effectiveness of audio advertisements across any app, hosting platform, or listening device. Veritonic is the market's all-encompassing audio research and analytics platform. Attribution, a crucial part of Veritonic's audio research and analytics platform, aids marketers in comprehending the impact of their audio creative and gaining useful insights that increase the return on their advertising investments.
• November 2020: In order to stay up with the various ways users are interacting with the site, YouTube is adding audio adverts. To reach users who use the service as their audio and podcast player, YouTube is introducing a new sort of audio-based ad unit. Although there is enormous potential to engage other sorts of audiences as well, YouTube highlights how audio advertisements are the ideal match for music channels.
• February 2020: At Podfront LA 2020, iHeartMedia launched the iHeartPodcast AdSuite, a tool for advertisers to efficiently deliver outcomes. This innovative product will give premium advertisers an easy-to-read summary of podcast listener analytics, including audience insights and profiles, consumption/engagement metrics, and delivery reporting, from all of the platforms to which the iHeartPodcast Network distributes content.

Global Audio Advertising Market Scope:

Segmentation

• By Medium
  • Radio
  • Music-on-demand
• By Device
  • Smartphones and Tablets
  • Smart TV
  • Radio
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • Germany
    • France
    • UK
    • Italy
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • UAE
    • Others
  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • Taiwan
    • Thailand
    • Indonesia
    • Others