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How to maximise the potential of audio advertising with smart speakers

Blog
Dan Pike, Chief Product Officer, Covatic

The advertising industry is constantly looking for ways to reach new audiences. In such a competitive market, it’s always worthwhile to investigate new and underexplored targeting opportunities. One such way of reaching untapped audiences is through smart speakers.

Smart speakers are already making (air)waves because of their potential when it comes to audio advertising. Nearly half (44%) of UK adults aged 16-64 owned a smart speaker in 2022, and the number is rising. This creates a highly engaged, addressable audience for brands to tap into.

To harness the potential of advertising via smart speakers, it’s important to understand what makes audio so unique, and what opportunities it offers.

The power of audio

Smart speakers have been in the market for less than a decade. However, the global smart speaker market is projected to reach $100 billion by 2032, at an annual compound growth rate of over 25%. Their rapid growth should place them firmly on every marketer's radar.

Although not always as high-profile as its visual counterparts, audio advertising – particularly on radio – has long been part of media plans, with RAJAR reporting commercial radio’s highest-ever audience figure (38.7m) in 2023. Smart speakers provide an opportunity for marketers to explore this audio space and monetise in new and innovative ways.

When it comes to content, short and punchy calls to action, core messaging, and engaging content are more memorable than long ads brimming with information. Lacking visual cues, creative execution is key. But smart speakers are more than just a listening device, with ample opportunity for marketers to flex their creative muscles.

More than a listening device

Smart speakers have evolved beyond voice-activated assistants, to become ‘companions’ for users. Beyond the obvious listening to music, podcasts, or radio, they can be useful tools for shopping, household organisation, or even step-by-step recipes when cooking. Understanding these nuances equips marketers with the knowledge to better target their audiences.

And, of course, users also speak to their smart speakers. This can be turned into an advantage for marketers, as, according to Neuro-Insight, conversational smart speaker ads generate 30% more brain engagement if a user utters the brand’s name after an ad.

Not only does the speech technology of smart speakers deepen the connection between brands and audiences, but it also enables ‘actionable’ audio campaigns. For example, users can request a link to be emailed to them or sent to their phone after listening to an ad. The interactive nature of these ads fosters engagement along the way. Whether it’s to sign into a new app, purchase a product, or request a service, this engagement is key to delivering results.

Make the most of popular formats

The varied and high-quality content on offer via smart speakers is also a plus for marketers. Live radio shows, for example, create unique bonds between the host and regular listeners. When radio becomes part of a consumer’s routine, it creates a sense of community and trust, which is then reflected in the ads or other brand messaging that feature alongside programming. By leveraging the programme’s unique data and audience knowledge, marketers can also identify prime targeting opportunities and tailor their strategies accordingly.

Podcasts are another incredibly popular opportunity for advertisers, accounting for nearly 60% of all digital audio spend in Europe. Fitness, relationship advice, movie reviews, business & entrepreneurship, and true crime are just some of the most popular genres. Brands have a golden opportunity to target what are often very specialised podcast audiences and drive revenue.

Incorporate ads into the flow of entertainment

To provide the best possible listening experience, while still delivering highly relevant ads, brands must take the time to understand their users’ listening habits. Incorporating ads into the flow of content effectively and seamlessly helps brands deliver their messages in an organic way. The same principles apply to audio as they do to TV and video: don’t have too many ads, keep content interruptions to a minimum, and avoid repetitive ads.

One popular way to deliver audio brand messaging is through host-read ads. Studies have shown consumers are more likely to buy a product that has been endorsed by a celebrity or personality they admire, and nearly three-quarters of consumers are more responsive to personalised ads. Audiences of a particular show already have an affinity with the host, whether it be a radio show or a podcast presenter. When personally read by them, in their characteristic tone and delivery, the advert resonates more with audiences, boosting engagement for brands.

Privacy-first, no matter the medium

Privacy is a growing concern for the advertising industry, so identifying audiences without the use of personal information is a growing priority for marketers, which requires its own set of technologies and solutions.

To truly succeed in the smart speaker advertising ecosystem, one must first select solutions that not only deliver outstanding results and significant ROI but also address growing addressability, effectiveness, and privacy challenges. Covatic’s unique approach enables brands to target audiences effectively and at scale across premium audio environments. Its privacy-centric technology enables brands to understand their audiences by categorising them and their behaviours without the use of any personal data.

Covatic’s solution works by employing a mix of first party data and probabilistic methodologies to understand users’ habits and preferences, according to select categories, enabling brands to ‘segment’ audiences for effective targeting. In doing so, Covatic enables brands to understand the behaviours of smart speaker users, without knowing who they are, targeting them by context rather than identity. Not only is this privacy-compliant, but it’s also highly effective and scalable.

Here are five top tips for getting started with audio advertising:

- Set out your campaign goals and identify your target audience – understanding who you want to deliver your messaging to is essential for a successful audio campaign.

- Identify the right formats for you and your audience – choosing between in-programme sponsorship or pre-roll advertising, for example, will play a large role in how the message is received.

- Align your advertising with the environment and consider the listening experience.

- Be clear and concise with your messaging and call-to-action. Keep your ad short.

- Ensure your creative is attention-grabbing – your audience may be involved in another activity while listening and you need to pull their attention in your direction.

- Have fun! Perhaps a sonic logo is in your brand's future.