Spotify introduced a new podcast advertising analytics tool at CES 2020

Spotify debuts new ad tech at CES 2020.
Image: Spotify

At the 2020 Consumer Electronics Show, Spotify unveiled a new advertising platform called Spotify Ad Insertion (SAI). The firm developed its new technology to help optimize its podcast monetization efforts. As such, the system will collect data on how many impressions its ads create, their frequency, and their reach. The tool will also capture anonymized user device, age, and gender information.

Spotify’s Podcast Analytics Tool

Currently, Spotify hosts more than 500,000 podcasts and saw a 39 percent increase in podcast hours consumed in Q3 2019. However, the firm had limited data on its users’ listening habits until the deployment of its new SAI tool. With it, the streaming service can harvest data that allows podcasters and advertisers to refine their outreach efforts.

By making podcast ads more targeted and data-driven, Spotify hopes to make host ad-reads function like subtle influencer marketing.

Notably, the Swedish-based corporation is only making its new tool available to podcasts it produces or are exclusive to its platform. As such, the firm will avoid the controversial content-advertising pairings that have hurt other streaming services. Indeed, TechCrunch notes podcasts have a high consumer engagement rate compared to other forms of media. Spotify’s SAI will increase the medium’s effectiveness as an advertising delivery channel.

The streaming giant has already had positive results utilizing its new podcast analytics tool. The firm deployed its latest technology to help Puma refine its advertising during “Jemele Hill is Unbothered,” Spotify found SAI increased host ad-read recall by 180 percent.

Spotify’s New Focus on Sports Podcasting

In addition to bolstering its monetization efforts, Spotify is also looking to increase its podcast offerings. Last week, Bloomberg reported the streaming service is in the process of developing a host of daily sports programming.

At present, the firm is considering its format and content options. For instance, the company is working on a podcast that will recap the day’s sports news in a tight 10 minutes. The firm is also looking at creating programs based around specific teams.

Spotify is building out its sports programming because the topic is hugely popular in podcasting and terrestrial radio. Indeed, analytics firm Prodtrac notes that programming produced by ESPN and Barstool Sports ranks among the nation’s most popular.

Despite its success in music streaming, Spotify is interested in expanding its podcast holdings for a few reasons. For one thing, the medium is becoming increasingly mainstream in the United States. In 2013, only 12 percent of American consumers of age 12 listened to a podcast monthly, but that number rose to 26 percent by 2018.

Besides, non-music streaming advertising revenue has risen at a similar pace. In 2018, U.S. podcasts generated $470 million in ad sales, but by 2019, they brought an estimated $700 million. Conversely, the company only made $513 million from advertisers in the first nine months of last year.

Furthermore, Spotify is interested in increasing its podcast income because it’s more profitable than its music streaming business. Notably, the service pays around 52 percent of the revenue generated from a song play to a record label. However, the corporation will get a much larger slice of the pie for its original non-music audio content.


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