Online Audio Comes Of Age As It Passes 1,000,000 Campaign Milestone

The iconic McDonald’s tagline may refer exclusively to hamburgers.  However, its relevance now applies directly to Triton Digital as well. As it was for Ray Kroc, there is tremendous pride to note that we have now served over 1 million different online advertising campaigns, representing a broad swath of advertiser categories.  This tremendous momentum puts us on track to deliver over 25 billion impressions this year alone!

As proud as we are of this accomplishment, much of this growth can be attributed to the maturing of the industry as a whole. Taking a look back over the last 6 years, online audio advertising has made terrific strides.  Once an after-thought for agencies with radio budgets, online audio is now carving its own niche and becoming an important channel for both digital and mobile budgets.

There are a few factors driving this.

First is the attention of a large and growing audience.  Triton measured 825,583,779 total listening hours in September, which means listening hours per month are up over 20% since the beginning of 2011. This includes both terrestrial radio stations that stream online and pureplay sites like Slacker and Pandora.  As consumers both here and abroad increasingly turn to smartphones for media consumption, access to streaming radio expands. In addition, the technology itself has become easier to use and vehicle integration has made major leaps, making it likely that consumption will continue to increase.

Second, there has been a dramatic shift in ad spend toward digital over the past several years. However, even with this movement, the share of ad spend is still well below the audience time spent online. According to eMarketer, consumers spent 25% of their total daily media time online in 2010 with advertisers spending 17% of their budgets on digital. As this shift continues in the coming years, online audio is poised for significant growth.

Finally, depending on the market and demographic, the online audience can compose 3-10% of overall listening for a radio station. We expect this number to hit an inflection point within the next 12-18 months with a double-digit percentage of demographics under 40 that will fuel more growth for the space. The mobile market in particular is ripe for major expansion, as listening to audio content has become a primary utility for mobile devices.

At Triton, the very first in-stream advertisement we ran was for Napster. In hindsight, this is practically ironic given that the service later became a controversial lightening rod for the digital consumption of audio. We’ve learned a lot since then, and so has the industry.