More Than Half of Streaming Audio Listeners Use Free Ad-Supported Services

March 13, 2020

This article is included in these additional categories:

Advertising Trends | Creative & Formats | Industries | Media & Entertainment

Nielsen Distribution Streaming Service Use Video vs Audio Mar2020Last year, the number of on-demand audio streams grew by almost one-quarter (23.8%) from the year before to reach 745.7 billion streams. While digital music streaming ad spend is still small, some growth is expected in the next few years. And while a lot of advertisers’ focus is being directed towards streaming video, recent findings from Nielsen show that advertisers are well-advised to examine the opportunity presented by streaming audio.

Put into perspective, of those respondents to Nielsen’s survey of consumer sentiment to streaming platforms, 94% of video streamers subscribe to at least one paid streaming service. On the other hand, fewer than half of music streaming users subscribe to at least one paid music streaming service. Instead, 53% use free, ad-supported streaming audio services, compared to the mere 6% of video streaming users who watch free, ad-supported video services. In other words, in the audio streaming universe the potential penetration for advertisers is much larger (proportionally) than in the video streaming landscape.

Although significantly more US consumers subscribe to video streaming services than music streaming services, that does not diminish the amount of time consumers are spending with audio. Research from Comscore shows that US listeners spend more than 100 billion minutes on ad-supported audio per month on the two largest music streaming mobile apps, Spotify and Pandora Radio, alone.

That same research shows that free service users are avid listeners too. Although paid users tend to edge out free listeners when it comes to minutes spent with the most popular audio streaming mobile apps (Spotify, iHeartRadio and Pandora Radio), the difference is small.

Per Nielsen’s report, the fact that listeners lean towards ad-supported audio isn’t surprising considering the continued support of radio throughout the years. Indeed, Nielsen reports that radio still reaches 92% of US adults listeners per week, which exceeds TV’s 87% reach and smartphones’ 81% reach.

So, what draws listeners to streaming audio? Some 78% of listeners say that ease of use is extremely/very important (top 2 box on a 5-point scale) . Almost three-quarters (72%) say that variety and availability of content is an important attribute. This is not unlike the attributes that appeal to consumers when they are choosing a video streaming service.

While cost is another important attribute for about two-thirds (64%) of respondents, availability across devices (60%) also is key, which is important considering that the aforementioned Comscore report shows that the vast majority (96.6%) of time listeners spend with streaming audio is through mobile apps.

About the Data: Findings are based on a Nielsen survey of customer sentiment to streaming platforms.

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