Spotify is getting serious about its programmatic offering by opening up its audio ad inventory and inking deals with the Rubicon Project, AppNexus and the Trade Desk to automate the highly-coveted audio slots.
Spotify has made no secret of its desire to be the dominant seller of automated audio inventory, having already outlined its intent to make all its media available this way within the next five years. Previously, only display and video inventory was able to be bought this way, with the new partnerships marking the first time programmatic has been brought to Spotify’s digital in-app audio through private marketplaces (PMPs).
Spotify previously sold audio ads through an audio-only ad exchange at a fixed price, and all transactions were completed via manual insertion orders.
The streaming giant is investing in ad tech to ensure that it’s popular Spotify free service remains open for users, and to ensure it doesn’t lose its grip on the market in light of competition for subscribers from Apple Music and Tidal.
AppNexus' programmable demand-side platform (DSP) will allow advertisers in Spotify’s 59 markets to automatically tailor ads for its 70 million ‘free’ listeners in real-time, giving marketers the ability to reach mobile consumers in scenarios that do not allow for visual advertising engagement ie when they are driving, walking, exercising, or working. Nielsen estimates that 79 per cent of audio consumption takes place while people are engaged in such activities.
Brands will be able target listeners with 15-and 30-second audio advertising spots based on age, gender, music genre and even specific playlists.
"AppNexus is thrilled to be a key partner to Spotify as it extends into programmatic audio," said Michael Rubenstein, the president of AppNexus, while Rubicon Project’s chief revenue officer Harry Patz said it was “thrilled” to partner with Spotify on the industry-first.
“With consumers increasingly turning to their mobile devices to consume content, streaming audio providers like Spotify are primed to tap into the enormous benefits of advertising automation as buyers seek access to audiences exactly where and when they are most receptive,” he added.
Spotify first rolled out its wider PMP programmatic ad offering in November 2015 after some experimentation, claiming that its ads offered vastly increased levels of transparency to brands because campaigns couldn't appear "below the fold".