Ad-Supported Music Streaming is a Growing Opportunity for Advertisers

January 7, 2020

This article is included in these additional categories:

Cross-Media & Traditional | Digital | Industries | Media & Entertainment | Radio

Comscore Music Streaming Minutes Jan2020Although music streaming apps such as Pandora, Spotify and Apple Music can be accessed across a number of different devices and platforms from desktops to the mobile web, recent data from Comscore shows that listening through mobile apps accounts for the overwhelming share (96.9%) of time spent by listeners.

For advertisers looking to reach audiences on the go, this mobile audience will be of particular value, especially because free, ad-supported listening accounts for around three-quarters (77%) of the total number of accounts. Across the two largest music streaming services offering an ad-supported option – those being Pandora Radio and Spotify – the total number of mobile app ad-supported minutes each month comes to more than 100 billion minutes each month, with Spotify (57.7 billion) ahead of Pandora Radio (45.6 billion).

In fact, paid users only listen to slightly more minutes each month on average across each of the platforms anazlyed, although Soundcloud has a more pronounced difference:

  • Spotify: 146.19 minutes per month for paid users, 127.70 minutes for free
  • iHeartRadio: 86.77 mins paid, 76.79 mins free
  • Pandora Radio: 82.26 mins paid, 80.81 free
  • Soundcloud: 58.51 mins paid, 36.68 free

As free users significantly outnumber paid users as a whole on music streaming services, this means that advertisers can still reach a large share of the US population of music streaming listeners, even as more users switch to paid subscriptions on these platforms.

On-Demand Listening Continues to Soar in Popularity

Separate research supports the opportunity for on-demand listening. Earlier figures from Nielsen show that on-demand music streams exceeded 500 billion in the first half of 2019, representing 31.6% year-over-year growth.

For those producing and publishing tunes, music streaming now accounts for the majority of total recorded music revenue industry revenues. Figures from the Record Industry Association of America (RIAA) show that 2018’s revenues from music streaming reached $7.4 billion, a 30% annual growth rate. This means that streaming accounted for 75% of industry revenues.

Online audio more broadly (i.e. listening to AM/FM stations online, as well as internet audio such as music and podcasts) is also demonstrating strong growth. Data from Infinite Dial reveals that two-thirds (67%) of Americans aged 12 and older now listen to online audio on at least a monthly basis, with 60% of the total tuning in weekly.

Advertisers should also note that wealthier Americans over-index for internet radio. As detailed in the 2019 US Media Audience Demographics Report [available for purchase], online adults residing in households with greater than $100k in annual income are 12% more likely than the average to tune in to internet radio each month.

About the Data: Based on Comscore Plan Metrix Mobile, mobile app only in the US for June 2019.

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