Closing the Loop: why advertisers have been slow to shift from terrestrial radio to Internet audio

Internet audio consumption is growing fast. On-demand streaming hours have grown 391% over the past five years and now reaches 140 million consumers – with nearly 100 million listening on mobile. Of these, 72% are consuming content on ad-supported audio apps. Given the numbers, it is not surprising that Internet audio advertising is now a billion-dollar market. But ad revenue growth has not kept pace with audience migration. Why not?

Limited Budgets and Lack of Proof

Terrestrial_Radio_Terrestrial radio advertising is dominated by local businesses with limited budgets. Budget constraints prevent these businesses from trying the new things, because they need to bring customers in the door and make sales in order to pay expenses and keep their businesses viable. Since terrestrial radio has worked in the past, these owners are properly cautious about changing something that is working. They will stick with terrestrial radio until they see proof that Internet radio will “close the loop” from advertising spend to customer action.

A Better Way to Connect with Consumers

Audio is different from other digital advertising. When an audio ad plays, that message alone has 100% share of voice. Listeners are not looking at the screen and seeing three other advertised links they could click. Nor are they consuming other content while an ad plays. Radio traditionally calls this spotlight advertising and it is a powerful differentiator. This fact alone distinguishes Internet audio ads from other digital ad content.

However, audio has an ad conversion challenge with mobile listening. If consumers are not looking at a screen while listening, how can they immediately interact with an advertised call-to-action? Marketers have come to see digital as a conversion medium and it’s been unclear how to reduce consumer friction in the ad conversion process. Until now.

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XAPP Ads Give Consumers a Voice

XAPP Ads allow consumers to interact with ads by voice. They simply speak to claim an offer or hear more information. This creates a natural conversion experience and means no more fumbling with lock-screens to see a tile or trying to remember an eight hundred number. Interaction is simple, spontaneous and convenient.

 

Measurable Conversion Provides an Opportunity

The migration of consumer attention to Internet audio content is an opportunity for advertisers to rethink their radio advertising strategy. The opportunity for advertisers is to leverage new capabilities unique to the mobile audio experience. Interactive Audio Advertising with XAPP Ads can transform radio ads into moments for direct customer conversion that “close the loop” and provide measurable proof. Higher return on advertising investment is a powerful incentive to accelerate the shift of ad dollars from terrestrial radio to Internet audio publishers.

Take a moment to experience some example ads right now, click the XAPP Ads Gallery here.To learn more about using XAPP Ads in your campaigns, please contact us by clicking here.