The digital audio space is really just beginning to hit its pace and so this is a perfect time for the Interactive Advertising Bureau (IAB) to come out with its authoritative A Digital Audio Buyer’s Guide developed by IAB’s Digital Audio Committee (on which BIA/Kelsey serves).

The digital audio market felt a seismic rattle with the news yesterday of Spotify’s expected $400 million capital raise which would bring its valuation to $8.4 billion more than twice that of leading competitor, Pandora, who closed out yesterday with a $3.55 billion market cap.

As BIA/Kelsey noted in a digital audio report we released last year (sponsored by XAPPmedia), “The Internet radio revolution has been brewing for some time. Streaming audio has gone mainstream for audiences and advertisers. This revolution is foundational, meaning that new business models are forming around new audience behaviors supported by technology advances.”

IAB’s Digital Audio Buyer’s Guide is a comprehensive but very digestible 26 page educational and reference document that lays out in a clear fashion everything from “what is meant by ‘digital audio'” to sizing the digital audio market, providing best practices and digital audio ad samples to providing insights around planning and buying.

“Digital audio” is defined as comprising broadcast AM/FM stations online, pureplay online radio stations, streamed audio content with selections influenced by consumer input, and audio-on-demand (i.e., podcasts). With over 50% of the U.S. population as current monthly users of various digital audio services, IAB cites eMarketer data showing this will grow to over 190 monthly digital radio listeners by 2019.

In BIA/Kelsey’s updated forecast for broadcast radio, we’re estimating that the advertising revenue from AM/FM stations streaming online will double from $1 billion in 2014 to $2 billion by 2019. That’s a significant growth component for an industry that otherwise won’t see much revenue growth. And we see a lot of new competition both for listeners and in selling access to local audiences.

In the pureplay digital audio world, Pandora will be releasing its latest earnings report on April 23, 2015. We’ll see then how it stacks up in its drive to increase local ad revenues and how Spotify’s raise may impact its share price. Since Pandora beefed up its local sales force presence, it managed to grow its local ad revenues by 155% to over $150 million in 2014.

It appears that the local digital audio market is no longer so sleepy as it may have appeared as social, mobile and video digital advertising claimed all the headlines.

The post IAB’s New (Free) Digital Audio Buyer’s Guide – Informs a Breakout Category appeared first on BIA/Kelsey - Local Media Watch.

The digital audio space is really just beginning to hit its pace and so this is a perfect time for the Interactive Advertising Bureau (IAB) to come out with its authoritative A Digital Audio Buyer’s Guide developed by IAB’s Digital Audio Committee (on which BIA/Kelsey serves).

The digital audio market felt a seismic rattle with the news yesterday of Spotify’s expected $400 million capital raise which would bring its valuation to $8.4 billion more than twice that of leading competitor, Pandora, who closed out yesterday with a $3.55 billion market cap.

As BIA/Kelsey noted in a digital audio report we released last year (sponsored by XAPPmedia), “The Internet radio revolution has been brewing for some time. Streaming audio has gone mainstream for audiences and advertisers. This revolution is foundational, meaning that new business models are forming around new audience behaviors supported by technology advances.”

IAB’s Digital Audio Buyer’s Guide is a comprehensive but very digestible 26 page educational and reference document that lays out in a clear fashion everything from “what is meant by ‘digital audio'” to sizing the digital audio market, providing best practices and digital audio ad samples to providing insights around planning and buying.

“Digital audio” is defined as comprising broadcast AM/FM stations online, pureplay online radio stations, streamed audio content with selections influenced by consumer input, and audio-on-demand (i.e., podcasts). With over 50% of the U.S. population as current monthly users of various digital audio services, IAB cites eMarketer data showing this will grow to over 190 monthly digital radio listeners by 2019.

In BIA/Kelsey’s updated forecast for broadcast radio, we’re estimating that the advertising revenue from AM/FM stations streaming online will double from $1 billion in 2014 to $2 billion by 2019. That’s a significant growth component for an industry that otherwise won’t see much revenue growth. And we see a lot of new competition both for listeners and in selling access to local audiences.

In the pureplay digital audio world, Pandora will be releasing its latest earnings report on April 23, 2015. We’ll see then how it stacks up in its drive to increase local ad revenues and how Spotify’s raise may impact its share price. Since Pandora beefed up its local sales force presence, it managed to grow its local ad revenues by 155% to over $150 million in 2014.

It appears that the local digital audio market is no longer so sleepy as it may have appeared as social, mobile and video digital advertising claimed all the headlines.

The post IAB's New (Free) Digital Audio Buyer's Guide – Informs a Breakout Category appeared first on BIA/Kelsey - Local Media Watch.

As mobile usage reaches ubiquity and revenue generation becomes the much-debated next frontier, Pandora finds itself at the nexus of this movement — rapidly accelerating its mobile usage while iterating on its ad platform to monetize that base at a similar pace. At MLM SF, VP of Audio Sales Doug Sterne noted that the company is now monetizing mobile at a 4x clip compared with a year ago. To continue that growth, it is making a strong move down-market to capture local business dollars.

Pandora now employs about 150 local premise sellers across major metros, in addition to national and telesales teams. It is further expanding its local footprint through recently unveiled media reseller partnerships with newspaper and TV groups in secondary and tertiary markets.

Sterne believes that Pandora’s mobile revenue growth with businesses big and small is a byproduct of its platform, anchored in its Music Genome Project that allows listeners to build their own channels. “We’re a super-personalized experience, which positions us as a very hyperlocal strategy for an advertiser to employ.”

The company continues to expand the opportunities for brands to connect with users experientially in new ways. As an example, Sterne offered Chase, which sponsored a custom-themed music channel to introduce its rewards program to targeted listener segments.

The post MLM SF: Pandora Moves Aggressively on Mobile, Local appeared first on BIA/Kelsey - Local Media Watch.

Research recently reported in Scientific American shows that work by Gregory Berns of Emory University supports the conclusion that magnetic resonance imaging (MRI) scans of brain activity while listening to music produce data that can predict subsequent sales. In particular, Berns isolated a portion of the brain called the nucleus accumbens whose activity in 27 teenagers listening to music correlated to subsequent sales of those songs several years later.

This kind of research could break new ground for media researchers ranging from radio stations to streaming service such as Pandora seeking an edge in understanding audience tastes and emerging preferences. Of course, the implications extend beyond music preferences to any type of user experience and engagement with media content including program content, commercial advertising content and even user-generated content.

As neuroscience has become more popular in the media field for those seeking to better understand consumer psychology and behavior, this new research direction shows promise. Groups such as the Advertising Research Foundation have been supporting collaboration in developing standards and practices in neuroscience research to make these methodologies more accessible and practical for use by those in the media and advertising industries.

The post Brain Scans Predict Pop Music Hits appeared first on BIA/Kelsey - Local Media Watch.

At ILM:10, Pandora’s Cheryl Lucanegro (senior VP of ad sales) and Brian Mikalis (VP of performance sales) made it very clear where the popular Internet radio service is headed next — to your car dashboard.

The company is leveraging two fundamental insights in driving (pardon the pun) its migration into the vehicle: More than 50 percent of all radio listening occurs in the car, and more than half of Pandora’s traffic is mobile (with more than 100,000 mobile activations each day) … a natural transition for on-the-go users.

Currently, Pandora’s auto strategy is nothing more than basic Bluetooth phone connectivity, but that will change in 2011 with manufacturing deals having been announced with Ford, GM and Mercedes.

Auto represents just the latest turf traditionally reserved for over-the-air broadcasting that Pandora is now loudly treading on. Now, the Oakland, California, service is targeting local businesses, many of which have longstanding relationships with legacy stations.

Mikalis runs an inside sales team that mainly prospects national and mid-market clients but has also begun local outreach. He emphasized that Pandora is also “aggressively talking to companies with feet on street to allow them to include Pandora as part of their network to find distribution for their advertisers.”

Pandora users personalize streaming stations around their favorite music genres and bands. This behavioral information, combined with gender, age and ZIP code, gives its sales force the ability to do multi-layer targeting for local business advertisers. Lucanegro said it distinguishes Pandora’s value propositon from traditional radio by allowing clients to “reach the right person with the right message at the right time,” and then measure how well they’re doing this.

Advertising can assume several formats (Web, mobile, audio, video, banner) and create multiple consumer experiences (branding, direct response, engagement, multi-screen). For instance, businesses can direct audio commercials to consumers, coupled with companion banners that allow them to simultaneously act on it (including unlocking local offers). The net effect, Lucanegro said, is pushing a message in front of consumer “more dramatically,” and at a price point that is competitive with its traditional broadcast rivals.

The post ILM:10: Pandora … Coming to a Car Near You appeared first on BIA/Kelsey - Local Media Watch.

With more than half of its 65 million users listening from portable devices, Internet streaming leader Pandora sees massive opportunity in mobile. In its latest move to tap that potential, the company is partnering with AdReady to introduce geo- and demo-targeted audio and display ad opportunities for local businesses.

VP of Sales Brian Mikalis told BIA/Kelsey that Pandora receives frequent outreach from local and regional merchants that are active users of its customized streaming services on their own mobile devices and wonder “how do I get my ad there?” AdReady’s tools will be used to “more efficiently get campaigns running,” primarily through building out display banners.

Local buyers can purchase audio, display, or bundle them. Mikalis underscored the value of having these dual formats complement and cross promote each other. As an example, an audio spot can encourage users to “tap on the banner ad” to engage in certain activities or enjoy exclusive rewards. Also, the ads couple registration-based geotargeting with basic demographic targeting (age, gender).

Mikalis said that Pandora is working on new solutions for geotargeting based on the real-time location of the phone rather than the registration ZIP code.

Advertiser demand for Pandora’s online and mobile platforms has mushroomed to the point that the company has doubled its SMB inside sales team, which is based in its Oakland, California, headquarters. Early adopters among local advertising categories include universities and cultural/entertainment centers (Mikalis cited a local aquarium and a performing arts center as relevant examples).

Pandora has made recent efforts to extend its service beyond the PC. Beyond mobile, it is pursuing several auto installation deals and is offering its advertising network across connected TVs and Blu-ray players through set-top box and middleware providers such as Roku and Google TV.

Mikalis and Cheryl Lucanegro (Senior VP of Advertising Sales), will cover this and other developments during a keynote address at BIA/Kelsey’s ILM ’10 conference Dec. 7-9 in Santa Clara, CA.

The post Pandora Tunes Local Businesses Into Geotargeted Mobile Ads appeared first on BIA/Kelsey - Local Media Watch.

At the recent NAB Radio Show in Washington, D.C., broadcasters, developers and vendors alike harped on the mobile mind-set change that must occur for effective strategic practices to take hold. The fundamental message: “Having an online stream and building a mobile app do not a digital strategy make.”

AirKast, a Cupertino, California-based mobile app developer and content provisioner for more than 900 radio broadcasters, as well as selected content providers (ESPN, DirecTV), designs applications to transcend the shoveling of on-air feeds from terrestrial airwaves to mobile devices. Shawn Sires, AirKast’s VP of media services and a featured panelist at NAB, told BIA/Kelsey that his company’s richer goal for broadcasters is to produce “interactive mobile user experiences.”

This suite of experiences begins with mobile tuning, but then allows listeners to actively engage the station’s full brand as they are consuming its product. Users can view associated video, call up full lyrics and view album art — all as a song streams. AirKast also customizes station playlists sorted by category (most played, artist, etc.) to enable users to sample the station, then buy songs directly. It uses metadata appended to radio streams to “trigger the interactive events.”

TuneKast is AirKast’s mobile application template that aggregates a station’s content together in a centralized place for distribution across all major operating systems (iPhone and BlackBerry, with Android under construction). Rich media ads — both from the local customer and third-party networks — can be served up within the apps in a variety of formats. Geolocation services are also layered on top. These tools give advertisers the ability to target in multiple ways and change campaigns in real time. 

Granted, terrestrial broadcasters still trail pure-play online streaming leaders like Pandora in the race to capture mobile music mind share, namely because Pandora allows its users to personalize their own stations and time shift content. However, AirKast’s customized user experiences and rich ad targeting add robustness to local mobile radio to at least position terrestrial broadcasters as a viable option.

AirKast’s current emphasis on mobile is as much a byproduct of marketplace movement as anything else. However, Sires sees greenfield beyond mobile, stressing that the company envisions content relationships springing up on a number of new devices and fashions itself as a “content provider for these content producers so the content can live appropriately on these devices.” Next up may well be IP-connected TVs, where Pandora has already made significant inroads into the living room.

The post AirKast Goes Beyond Streaming to Enrich the Mobile Radio Experience appeared first on BIA/Kelsey - Local Media Watch.

In July, BIA/Kelsey projected that OTT homes — or those services providing linear and nonlinear video services over third-party bandwidth to the TV — will exceed cable homes by 2013. A February IMS Research report on “Internet Video to the TV” pegged 78 percent global growth in OTT devices, with 25 percent of American households able to display Internet video on TVs.

After a flurry of new releases and partnership agreements, device makers, middleware companies and content providers are catching up to — and justifying — these forecasts.

Read the rest of this post.

The post OTT Breakthroughs — Google, Pandora and Hulu (Oh My!) appeared first on BIA/Kelsey - Local Media Watch.