Digital audio sees shifts due to coronavirus
Consumers are tuning into digital audio differently now that home is the new office. As fewer listeners commute due to the coronavirus pandemic, downloads for podcasts are declining. But there are bright spots, as genres such as science, cooking, health, news and kids’ music see a surge.
Advertising is another story. Podcast creators are seeing a rise in media buyers blacklisting shows that discuss coronavirus—a trend first seen with online news publishers. And some brands, particularly those in the retail and service categories, are hitting pause on their digital audio ad spend.
“We are either seeing canceling budgets or postponing campaigns,” says Alexis van de Wyer, CEO at Pandora-owned AdsWizz, the largest programmatic audio exchange in the market. “The type of advertisers is also changing: Auto dealerships, brick-and-mortar stores, sports, casinos—all those categories are getting hammered.”
Van de Wyer says there’s been almost a 30 percent drop in second-quarter bookings, citing recently released research from the IAB. “That is massive,” he says.
No more commute
Similar to out-of-home, digital audio captures much of its traffic from the 157 million people who make up the U.S. workforce. Of those, nearly 77 percent drove alone to work each day, according to the 2016 figures from the U.S. Census Bureau, the latest available. “A lot of listening happened during the commute,” van de Wyer says. “We see that almost entirely disappearing.”
On the other hand, Lee Brown, VP and global head of advertising sales at Spotify, says he has “seen an increase across devices like computer desktop, gaming consoles, TV and smart speakers.”
U.S. podcast downloads fell each week during the last three weeks of March (down 1 percent, 2 percent and 4 percent, respectively), according to Podtract, which provides measurement data for advertisers. Popular genres also fell, including tech (19 percent), history (17 percent) and sports (10 percent).
However, some genres grew, including fiction (up 19 percent), business (up 10 percent), science (up 9 percent) and children-themed content (up 9 percent).
The disappearing commute has only somewhat affected traditional radio: 83 percent of those 18 and older said they tuned in the same or more during the pandemic, claims Erica Farber, president and CEO of Radio Advertising Bureau.
Still, consumer behaviors have changed, as people tune into digital audio at various parts of the day versus the typical hours associated with a daily commute. About 80 percent of listening is also now happening in homes, which has prompted a 100 percent surge in use of devices like Amazon Alexa and Google Assistant, according to van de Wyer.
Pandora, iHeart and Spotify declined to share baselines for all figures provided.
From niche to mainstream
Downloads for “This Week in Virology,” a 12-year-old podcast focused on viruses “that make you sick,” were up more than 900 percent in March compared to the previous month, according to Libsyn, the largest paid podcast-hosting network which works with Pandora, Spotify, Amazon, Google and Microsoft. “Their topic was niche until it became mainstream,” says Rob Walch, VP of podcaster relations at Libsyn.
However, despite demand for health-related content in the face of COVID-19, in recent weeks nearly a thousand shows have been blocked using Adwizz’s blacklisting software, PodScribe, up from about 80, as marketers move away from virus-related content, the company says.
TV vs. radio
“We have seen that, in general, people are choosing their TVs instead of audio when spending time at home,” says Keri Feeley, senior VP and group partner of integrated investment at UM. “With fewer people commuting, drive time audio has seen declines. There could be less interest in advertising in the digital audio space if the drops remain consistent.”
Conal Byrne, president of iHeartRadio Podcast Network, says the network, which includes some 350 different shows, is actually up 6 percent month-over-month, adding that the figure is even higher in markets where shelter-in-place-orders are in effect such as California (13 percent increase) and New York (8 percent).
iHeartMedia, like Pandora and Spotify, is pitching to advertisers their ability to quickly change a brand’s messaging so it’s not tone-deaf. The fast turnaround is something video can’t offer, audio streaming giants say.
Byrne adds: “I’m not pretending there won’t be disruption to second-quarter revenue, but we are not seeing waves of cancellations like some other media types.”
Walch says that direct-to-consumer meal delivery companies, a staple in the podcast advertising arena, are halting buys because they simply do not have the inventory to meet demand from the rise in homebound consumers. “Advertisers who have retail space and an online presence are now adding to promote online to offset retail,” Walch says. “There are certain ones that have canceled ads that deal with travel or sporting events—you can’t blame them. It’s a case-by-case basis.”
Overall, brands are giving their creative a second look to make sure it’s up to par with the cultural climate. “What I’m finding is marketers need us most with creative and targeting guidance,” says Lizzie Windhelm, senior VP of ad innovation at Pandora. “All of our sellers are auditing their creative and asking if it speaks to the consumer right now.”
Pandora declined to share specific figures, but says it’s seeing an increase in the types of devices people are using to stream audio: gaming consoles, TVs and smart speakers are all up in usage, the company says, adding that brands should take that into account when deciding on creative. Pandora also says that cooking shows, dance party music and children-themed content are all on the rise.
Jack-in-the-Box worked with Spotify to tweak audio ads so they included a message that says the restaurant is open for business and that customers can get their food through “drive-thru, mobile app or delivery.”
Procter & Gamble worked with Pandora in pivoting its message for Pampers’ “Share the Love” campaign by shifting focus away from how incredible mom is to directly speaking about the uncertain times that lie ahead. “We know that right now you have a lot on your plate,” a narrator for the updated spot says. “So we wanted to remind you of one very important thing: You’re doing a great job. So give yourself a little love.”