A reflection on the reasons for digital audio advertising’s non-appearance in the recent IAB ad revenue report – it’s high time advertisers tapped into this hidden gem.
The most recent IAB South Africa Advertising Revenue Report for the year 2022, conducted by PwC and released in August 2023, revealed a total Internet Advertising revenue of R14.5 billion, showing a 10% year-on-year growth.
This growth is notably lower compared to the substantial 43% increase seen in 2021.
However, it is important to contextualise this variance by considering the profound impact of the Covid-19 pandemic when, initially, advertisers hesitated to invest in advertising – but as the shift towards digital accelerated due to increased remote work, there was a significant uptick in spend.
In terms of spend allocation, search advertising continues to dominate, accounting for 78% of the total revenue. Meanwhile, ad spend on paid social decreased, and there was a notable increase in display: non-programmatic, which surged to 5%.
Same, but oh so different
Most disappointing about the report is the absence of audio advertising. In the 2021 report audio came in at an underwhelming 1%, but least comfort was taken from the fact that it featured, and the medium was on the map.
Unfortunately, in this report, it was ultimately grouped under the ‘other’ category, thereby placing it below the 1% benchmark.
The lack of growth highlighted in the report is not aligned with the significant growth currently being experienced across the Mediamark Digital Audio offerings.
To better understand what we mean by digital audio and its advertising components, Mediamark makes a distinction between digital audio advertising, and podcasting advertising.
Digital audio advertising refers to audio advertisements delivered in the respective broadcast or internet stations’ live stream and present as either pre-rolls delivered at the beginning of the stream, or as mid-rolls, during the standard advertising breaks within the broadcast stations.
Typically, these ads are accompanied by display companion advertisements that appear on the station’s player.
Podcasts Advertising within podcasts can be dynamically delivered as pre-rolls, mid-rolls, or post-rolls, or it can be integrated into the content itself, where the host discusses the product or personally delivers the advertisement.
Getting to grips with potential
Year on year growth has been good, and demand is steadily increasing, particularly in the podcast space where clients are keen to get on board, but are grappling with the challenge of navigating it effectively.
This challenge seems to be a common theme when it comes to the world of digital audio advertising, and can only be put down to education, and a hesitation to experiment with the medium in order to come to grips it.
Another consideration is that, possibly, the percentage revenue reflected in the PwC report has fallen victim to another challenge that we see on a regular basis. In this scenario, digital audio appears to be in a somewhat ambiguous position, not quite fitting neatly within the domains of digital and radio planners.
The medium has not yet defined its distinct role within this landscape, and there remains a lack of consensus between radio and digital planners regarding its placement, and the respective responsibilities in harnessing the significant potential that digital audio offers. This includes recognising the complementary aspects of digital audio and broadcast radio.
A clear takeaway from the report is the substantial and relatively unexplored potential of digital audio advertising. There is no doubt that advertisers will inevitably embrace this hidden gem, and, as is often the case with promising opportunities, those who venture in early will enjoy substantial benefits, while those who follow will need to play catch-up.
Mark Botha is head of digital at Mediamark.
