Internet Radio Ad Load Up, Advertisers Increase

RADIO ONLINE | Wednesday, August 5, 2015

Internet radio ad load on mobile climbed in the second quarter, according to the Internet Radio Ad Load Q2 2015 report by XAPPmedia. But, it still trails Q4 2014 levels at the height of the holiday ad season. Whereas Q1 2015 experienced a 16% decline in ad load over the previous quarter to an average of 2 minutes 18 seconds (2:18), Q2 2015 is up 10% sequentially to an average of 2 minutes 32 seconds (2:32). The seasonal fall in ad spending impacted Q1 and seasonality plus a rise in advertisers is likely driving second quarter increases.

Ad load increased markedly even within the quarter with June reaching 2:43, the second highest rate recorded. This trailed only December 2014 when there were 2-3% fewer listeners than today. As a result, XAPPmedia estimates that total ads served in June were on par with December.

The second significant change is an increase in the number of advertisers on the five Internet radio publishers tracked. Advertisers in Q2 totaled 149, a 26% rise over the previous quarter and the largest quarterly total to date. Unique advertisers identified each month ranged from 67 in April to 82 in May. More advertisers moving into Internet radio may encounter current inventory sell-through challenges caused by competition with other ad channels and the steady growth in users and listening hours that yields an ever-increasing number of ad slots to sell.

The number of local advertisers nearly doubled from the previous quarter. In Q2, 21% of advertisers identified were local, up from 15% in Q1. This trend suggests Internet radio publishers are clearly making an effort to broaden the advertising base beyond national advertisers.

Average ad units per hour also rose in the quarter as did the percentage of ads that were 30-seconds in length. Summary findings concluded:

1. Ad Load is averaging about 2.5 minutes per hour (about 22% of the average broadcast radio ad load)
2. More advertisers are using Internet radio and providing more diversity for publishers (257 different advertisers identified since November 2014)
3. 30-second ads are the preferred format accounting for more than 4 in 5 spots