THE STATE OF VOICE + AUDIO REPORT - PAST, PRESENT AND FUTURE OF VOICE AND AUDIO MARKETING - Sparkloft Media
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T H E S TAT E O F V O I C E + AUDIO REPORT PAST, PRESENT AND FUTURE OF VOICE AND AUDIO MARKETING
TA B L E O F CO N T E N T S
03 THE AUDIO
LANDSCAPE 13 PODCASTS
04 H I S TO R Y O F
AUDIO 18 VOICE
08 STREAMING 23 CO N C L U S I O NOther
THE AUDIO 2%
Podcasts
LANDSCAPE 3%
TV Music Channels
EDISON RESEARCH REVIEWS 5,000 ONE-DAY AUDIO DIARIES 5%
FROM CONSUMERS EACH QUARTER
In Q3 2018, AM/FM radio is still the most widely consumed audio in SiriusXM
the U.S. but actively dropped from 50 percent in Q1 2018. [1] 7%
Streaming audio, like Spotify and Pandora, come in second as more
people gravitate to customized experiences, particularly on mobile. AM/FM Radio
Podcasts only capture 3 percent of the total share of ear, but of this 46%
group, podcasts are the No. 1 audio they consume.
YouTube
In terms of device used, smart speakers sneak in with 2 percent [2] 11%
— AM/FM radio receivers are still the No. 1 followed by mobile
devices and computers. The No. 1 reason people purchase a smart
speaker is to listen to music and audio, so we expect within the next
year that preferred listening will gravitate to these devices.
Owned Music
12%
Streaming Audio
14%
1. Edison Research, “Share of Ear: Americans 13+ Share of Time Spent Listening to Audio Sources,” Q3 2018
3
2. Edison Research, “Radio’s hardware problem: How does radio compete if consumers don’t have radios?“ September 2018H I S TO R Y O F A U D I O
4EVOLUTION OF
AUDIO
HOW DID WE GET HERE? WHERE ARE WE HEADED? stage for smart speakers. In fact, most device
Thomas Edison first invented the phonograph For the past 20 years, we’ve had a multitude of owners report that they initially bought a smart
142 years ago. Commercial radio broadcast ways to access audio from radios and owned speaker to listen to audio.
started 99 years ago. And just 40 years later, media to later streaming and smartphone apps. While other brands scramble to join the smart
IBM debuted the first voice assistant at the Then, in 2017 consumers surprisingly passed on speaker rat race, Spotify continues to prioritize
1962 World’s Fair in Seattle. The audio virtual reality headsets — which were expected its audio product first. They recently bought two
evolution has been moving at a breakneck to be the next big tech — and instead went for podcast companies, releasing Pandora-like radio
speed with no signs of slowing down. smart speakers.[3] stations for easy listening and more
There are two themes of our evolution: A handful of brands are vying to be the smart sophisticated ad placements in anticipation of
The emphasis on voice technology and speaker in American households, but Amazon the surge of listening on these devices.
the consolidation of digital media access. Echo and Google Home have the largest share Amazon Music and Apple Music have since taken
of the market. [4] similar steps as the competition for music and
Streaming overtaking owned media in terms of podcast streaming increases by providing
preferred audio consumption further sets the streamlined integration with their products.
3. Slate, "Smart Speakers are the Best-selling Consumer Gadget because People Keep giving them as Gifts," January 2018
5
4. voicebot.ai, “U.S. Smart Speaker Ownership Rises 40% in 2018 to 66.4 Million and Amazon Echo Maintains Market Share Lead Says New Report from Voice Bot,“ March 2019THE MOVEMENT OF
AUDIO
IF THE GOLDEN AGE OF RADIO AND THE 1960S WERE THE START THE 2020S ARE POSITIONED TO BE THE
WAS THE 1930S TO 1940S OF THE DIGITAL REVOLUTION GOLDEN AGE OF INTERACTIVE MEDIA
In the late 19th century, the phonograph was Music cassettes were first released in 1965 With the ubiquity of smartphones and
first invented and people were able to buy and the compact disc came to market in 1982, easily accessible audio apps, we’ve moved
them as well as the first disc recordings. both disrupting the market again. Consumers quickly beyond our owned digital media to
In the 1930s and 40s, radio broadcasts largely abandoned records by 1991. more media than we could consume — the
brought people together for nightly CDs were quickly eclipsed by other means of time between the first CD to the release of
programming, news bulletins and music. digital storage by the late 2000s with the Spotify is just 26 years.
creation of the iPod and subsequent MP3 In the age of information, we’re filtering
player options on the market. through a lot of noise and the smart
speaker revolution is the tool to help.
6TIMELINE OF AUDIO
MUSIC STREAMING APPLE LOOKS TO COMPETE
PLATFORM SPOTIFY COMES IN STREAMING MUSIC WITH
TO MARKET; AVAILABLE IN THE RELEASE OF
THE FIRST PEER-TO-PEER THE US STARTING IN 2011 APPLE MUSIC
FILE SHARING SOFTWARE, APPLE DEBUTS ITS
NAPSTER, DEBUTS PODCAST APP
APPLE BEGINS SHIPPING
IBM’S QUESTION- MICROSOFT ROLLS OUT HOMEPOD AND IBM
IBM RELEASES SHOEBOX, ANSWERING COMPUTER CORTANA, LATER ANNOUNCES THAT WATSON
THE FIRST DIGITAL SPEECH SYSTEM WATSON BEATS RELEASED ON WINDOWS ASSISTANT WILL BE AVAILABLE
RECOGNITION TOOL YOUTUBE AND JEOPARDY! STARS 10 IN 2015 AS A WHITE LABEL SERVICE
PANDORA COME
TO MARKET
2001 2007 2011 2014 2016 2019
1962 1999 2005 2008 2013 2015 2018
APPLE RELEASES ITUNES APPLE’S SMART ASSISTANT GOOGLE DEBUTS GOOGLE
AND EIGHT MONTHS LATER SIRI NOW AVAILABLE ON ASSISTANT AND LATER IN
THE PORTABLE MEDIA DEVICES THE YEAR, GOOGLE
PLAYER, IPOD ASSISTANT COMES TO
AUDIO DISTRIBUTION MARKET
PLATFORM SOUNDCLOUD
DEBUTS
AMAZON ALEXA IS SPOTIFY BUYS
AVAILABLE TO PRIME PODCAST
USERS COMPANIES
ANCHOR +
GIMLET MEDIA
7STREAMING
8EVOLUTION OF
STREAMING AUDIO
REVOLUTION BEFORE REGULATION
Over the last 20 years, streaming and digital
downloads have undergone the largest
transformation as lack of regulation had to catch up
with the internet age:
- From the days of illegal downloading and sharing on
Napster and Limewire [5] to the release of Apple’s “ OVER THE LAST 20 YEARS,
iTunes and later Apple Music. [6] S T R E A M I N G A N D D I G I TA L
- Grooveshark and Spotify’s race to revolutionize
digital music streaming, only for Grooveshark to D O W N LOA D S H AV E U N D E R G O N E
shutter following copyright infringement lawsuits. [7] “
- The continued refinement of a truly personalized T H E L A R G E S T T R A N S F O R M AT I O N …
listening experience, starting with Pandora Internet
Radio, helping users to discover new music through
radio stations — arguably a first in a personalized
music experience. [8]
- Apple Music and Amazon Music join the competition
releasing their own subscription-based services and
recently introduced an ad-supported, free version,
similar to Spotify.
5. NPR, "Napster: The File-Sharing Service That Started It All?" December 2009 7. The Verge, "Why Grooveshark failed: The Wild West days of the web are over," July 2015
9
6. Macworld, "15 years of iTunes: A look at Apple’s media app and its influence on an industry," January 2016 8. Quarts, "Put your lighters up for Pandora, the music service that briefly changed the world," June 2017CO N S U M P T I O N
B E H AV I O R S
DOES MUSIC STILL FEEL THE SAME?
Long gone are the days of file management, portable
music players and individual song and album
purchases as our smartphones act as all-inclusive
248M+
AC T I V E M O N T H LY U S E R S
media centers and the creation of subscription-based WO R L D W I D E F O R S P OT I F Y [ 9 ]
access to unlimited music.
With literally an endless music library in our
hands, has the constant flow media taken away from
the personal connection consumers previously had
to music?
49%
Data shows that 99 percent of all 337 billion music
streams in 2017 came from just 10 percent of the
year’s most-streamed songs — not what you’d
expect from consumers that have more choice than P E R C E N TAG E I N C R E A S E I N
ever before. While being a vessel of discovery, OVERALL MUSIC
CO N S U M P T I O N A F T E R
streaming has widened the gap between popularity A D O P T I N G S P OT I F Y [ 1 0 ]
and obscurity.
9. Statista, "Number of Spotify monthly active users (MAUs) worldwide from 1st quarter 2015 to 3rd quarter 2019 (in millions)," November 2019
10
10. Tilburg University, "Changing Their Tune: How Consumers' Adoption of Online Streaming Affects Music Consumption and Discovery," May 2017WHERE IS IT GOING?
CONNECTIVITY IS KEY EVERYTHING IS MOVING TO VIDEO,
Access to streaming through consumer EVEN MUSIC
products is a central selling point for new Music videos once reserved for MTV are finding
technology. As you’ll read later, the No. 1 reason new life with Generation Z. Not only are users
people purchase smart speakers is to listen to watching music videos, they’re making their
music and audio. Smart speaker integration has own with music-centric apps like Thriller and
the potential to give Amazon Music a leg up in TikTok, the latter of which is reportedly
the competition with its slew of Alexa-enabled launching its own music streaming service. [11]
projects.
Using humor set to short song clips, these apps
THE RACE TO BE THE KING OF AUDIO have delivered countless viral memes and are
Spotify has held a strong lead as the most responsible for “Old Town Road,” the longest
popular audio streaming service, but Apple standing Billboard No. 1 song of all time. [12]
Music and Amazon are catching up. Amazon
and Apple have both released free ad-
supported streaming services to compete with
Spotify. As smart speakers are becoming more
widely adopted, we expect the competition
between these three companies to intensify.
11.One Zero, "TikTok Is Gen Z’s MTV — but Better," October 2019
11
12. Pitchfork, "'Old Town Road' Is Now the Longest Running No. 1 Song in History," July 2019W H AT M A R K E T E R S
N E E D TO K N OW
AD REACH POTENTIAL IS HUGE
Spotify is one of the largest music streaming platforms and
one of few that have a free, ad-supported option. Out of the
giant's 248 million monthly active users, roughly 135 million
of those are reached by Spotify audio advertisements.[13]
And though audio may seem like a medium of the past,
Spotify has reported that audio ads drive 24 percent higher “ T I K TO K I S T H E DA R K H O R S E
recall than display ads. [14] OF THE MUSIC INDUSTRY AND
TIK TOK IS COMING
TikTok is the dark horse of the music industry and won’t be W O N ’ T B E A B L E TO B E I G N O R E D
able to be ignored for much longer. Surpassing 1 billion “
downloads and still growing, the China-based app has been F O R M U C H LO N G E R .
a favorite among teens. [15] It’s capturing the attention of
multinational brands seeking partnerships with the
opportunity to engage a younger generation and achieve
levels of reach and engagement previously reserved for
Facebook.
13.Venture Beat, "Spotify grows users 30% in Q3 2019, premium subscribers reach 113 million," October 2019 15.Business Insider, "TikTok was bigger than Instagram last year after passing the 1 billion download mark," February 2019
12
14. Spotify, "The Power of Audio: Chapter 2"PODCASTS
13EVOLUTION
OF PODCASTS
THE BEGINNINGS PODCAST BOOM
Audioblogging first started in the 1980s, but it Nearly 30 percent of all podcasts listed on the
62M
took a new RSS enclosure that would allow the Apple Podcast app was launched between 2014
transfer of an audio file. Software developer and 2015. Some credit the widespread true
Dave Winer created the necessary enclosure in crime podcast “Serial” from This America Life for
2001 and further demonstrated its use by the boom. [18]
repurposing 25 audio interviews by journalist N U M B E R O F W E E K LY
Today, roughly 540,000 podcasts are growing by P O D C A S T L I S T E N E R S I N U. S . [18]
Christopher Lyndon and gradually releasing
2,000 each week. In constant competition with
them as a new RSS feed. [16]
Apple, Spotify is staking its claim as a leader in
The term got an unexpected facelift in 2004
$1B
audio after supporting audio-first media on
when journalist Ben Hammersley asked what its platform and purchasing podcast company
to call the next boom in audio and combined Gimlet Media and podcast creation
the terms “iPod” — the popular MP3 player at company Anchor. [19]
the time — and “broadcast”: “Audioblogging? PROJECTED PODCAST AD
R E V E N U E B Y 2 0 2 1 [18]
Podcasting? GuerillaMedia?” [17]
16. Your Tech Story, "Dave Winer : American Software Developer & the Fore-father of Blogging," October 2018 18. Variety, "How Conan O’Brien and Other Top Hosts Are Tapping Into the Podcast Revolution," August 2019
14
17. The Guardian, "Audible revolution," February 2004 19. TechCrunch, “Spotify buys Gilmet and Anchor in podcast push, earmarks $500M for more deals,” February 2019CO N S U M P T I O N
B E H AV I O R S [ 2 0 ] MONTHLY PODCAST
CONSUMERS 12+
PODCAST LISTENERS TODAY Streaming services play a key role in the growth Age 18-34
Podcast listeners are loyal, affluent and of podcasts, with 43 percent of monthly podcast 39%
Age 35-54
educated, with 54 percent male and 46 listeners using Spotify and 35 percent Pandora.
35%
percent between the ages of 18 and 34. SHARE OF TIME
The most popular locations for podcast listening Podcast listeners primarily tend to listen more
are: home (90 percent), in a car or truck (64 to podcasts than other audio sources. They
Age 12-17
percent), and while walking (49 percent). spend 28 percent of their time listening to 10% Age 55+
AWARENESS GROWTH podcasts with AM/FM radio and streaming 16%
audio following behind at 24 percent and 15
Podcast awareness in the U.S. has increased
percent, respectively. That number increases
with an estimated 17 million more persons
to 42 percent when listening to podcasts on a White
African American
aware of podcasting since 2018; 20 million 66%
smartphone. 11%
more persons have ever listened to a podcast
than in 2018.
Hispanic
Increased podcast listeners along, with
9%
increased audiobook consumptions indicate a
Asian
trend towards spoken-word audio consumption. 4%
Other
7%
Refused
3%
20. Edison Research, "The Infinite Dial 2019," March 2019 *Sources: The Infinite Dial © 2019 Edison Research and Triton Digital 15WHERE IS IT GOING?
FIGHT FOR THE REMAINING 49 PERCENT PERCENTAGE OF U.S. POPULATION WHO LISTENED TO
While the gap between familiarity and listening has A PODCAST IN THE LAST MONTH [20]
been closing, the future of podcasts will be determined
40
by the remaining 49 percent of the U.S. population that
hasn’t yet heard of podcasts. This will lead to creating
easier consumption experiences for new users through
more accessible distribution channels. We expect this
30
will lead to more creative content, such as shorter
podcasts, to better reach this untapped market on
the platforms they use, such as streaming and smart
speakers. As barriers to entry remain low, we’ll see
20
more creators and content making their way in
and vying for a piece of the market before it gets
overly saturated.
10
0
12-24 25-54 55+
2017 2018 2019
20. Edison Research, "The Infinite Dial 2019," March 2019W H AT M A R K E T E R S
N E E D TO K N OW
ADVERTISING IN PODCASTS
Podcasts listeners generally don’t skip ads.[21] In
fact, podcast listeners are more likely to
“
consider brands advertised on podcasts than to
not. As audio trends, podcasts offer new ad P O D C A S T S L I S T E N E R S G E N E R A L LY
space that captures listeners in screen-less
moments: Cooking, cleaning, exercising. D O N ’ T S K I P A D S . I N FAC T, P O D C A S T
AUDIO MEDIA MARKETING
The most popular location for podcast listening
L I S T E N E R S A R E M O R E L I K E LY TO
happens in homes. American homes have an
average of two smart speakers. With smart
CO N S I D E R B R A N D S A D V E R T I S E D O N “
speaker ownership now up to 23% for American
(an even higher number for podcast listeners), P O D C A S T S T H A N TO N OT.
audio media marketing will be an important
factor in reaching podcast listeners. If you
thought SEO was hard, imagine the world
of audio where people don’t want search
results pages.
21. Wired, " Podcast Listeners Really Are the Holy Grail Advertisers Hoped They'd Be," January 2018
*Sources: The Infinite Dial © 2019 Edison Research and Triton Digital 17
22. The Guardian, "Audible revolution," February 2004VOICE
18EVOLUTION OF
VOICE
SMART SPEAKER ADOPTION
Smart speakers are arguably the fastest
20%
P E R C E N TAG E O F S M A R T
adopted technology across all age groups due S P E A K E R OW N E R S W H O H AV E
E V E R U S E D T H E D E V I C E TO
to its attainable price point, ease of set up and M A K E A P U R C H A S E . [24]
usability. Most devices are set up in communal
spaces like living rooms and kitchens, making
71%
them accessible to everyone in a household.
[23] It's also become an essential device for
people with impairments or disabilities.
Most owners use the device to play audio, ask P E R C E N TAG E O F S M A R T S P E A K E R
about the weather or ask “fun” questions. It’s O W N E R S W H O U S E D E V I C E S AT
L E A S T DA I LY [ 2 4 ]
clear that the consumer requires more
education about everything smart speakers
66M
can do for them as companies continue to
update and add features.
N U M B E R O F U. S .
H O U S E H O L D S A N T I C I PAT E D
TO H AV E S M A R T S P E A K E R S
B Y 2 0 2 2 [25]
23. Variety, " Smart Speakers Most Popular in Living Rooms, Followed by Bedrooms and Kitchens, Survey Says," December 2018 25.New York Times, "The Race to Create the Coolest Smart Home Devices Is Hotter Than Ever," January 2019
19
24. Vox, "Recode Daily: Inside the hype and reality of the voice technology 'revolution,'" November 2018CO N S U M P T I O N
B E H AV I O R S [ 2 4 ]
x
MOST POPULAR USES OF SMART SPEAKERS
Listening to music 70%
Weather 64%
Asking fun questions 53%
Online research 47%
Alarms/Timers 46%
News updates 46%
Making calls 36%
0 0.175 0.35 0.525 0.7
24. Vox, "Recode Daily: Inside the hype and reality of the voice technology 'revolution,'" November 2018 20WHERE IS IT GOING?
AMAZON AND GOOGLE GO HEAD TO HEAD
The two frontrunners have approached their
devices in two different ways, though both with the
“
objective of being a part of a user’s daily routine.
Amazon’s product is focused around Prime
T H E T WO F R O N T R U N N E R S H AV E
purchasing and brand products like Echo Look for
online clothing shopping and the Key Smart Lock
A P P R OAC H E D T H E I R D E V I C E S I N T W O
for package delivery. Google pushes its Home
users to engage with G-suite apps like checking D I F F E R E N T WAY S T H O U G H B OT H W I T H
Gmail, notifications about your next meeting on
Calendar, or giving you traffic updates from Maps. T H E O B J E C T I V E O F B E I N G A PA R T O F A “
In order to populate their voice platform, Amazon
opened this to third-party developers, allowing
U S E R ’ S DA I LY R O U T I N E .
them to upload anything that fits into the platform.
Google has wholly-owned its platform with the
multitude of information the company has access
to, thanks to Google search.
While Amazon leads the pack, we predict it will be
Google that will ultimately own the market.
21W H AT M A R K E T E R S
N E E D TO K N OW
SO YOU WANT TO MAKE AN ALEXA SKILL THE THING ABOUT SMART SPEAKER
Marketers are now able to build voice-enabled CONVERSIONS
branded skills through Alexa to reach For Amazon, Google and the rest of the
consumers through the power of audio. If companies bringing smart speakers to market,
you’re ready to start making your own skill, there is no benefit to them in supporting your
there's a lot to consider before you jump into skill. These devices don't support “discoverability”
your first brainstorm: How will people interact that we’ve become accustomed to through home
with it? What will it sound like? Is it a one-and- screens, landing pages and newsfeeds.
done product, or will it need to be updated Furthermore, if you market your skill on your
with new information? Where do you want website or on social media, there is no way to
people to experience your skill? And track conversation seamlessly, though one
what makes your skill stand out from expert we spoke with predicted conversion to
everyone else’s? be 1 to 1,000.
Though it’s possible to create an Alexa skill on
your own at no cost, we highly recommend
working with a developer and ideally an
experienced agency to execute your final
product to mitigate the risk of a buggy or
crash-prone skill that leaves users frustrated.
22CO N C L U S I O N
NEW OPPORTUNITIES IN AN OLD MEDIUM
If we learned anything from audio in 2019, it’s that we will only see
increased opportunities for advertisers in the new year. Streaming,
podcasts and voice capture audiences in ways that others can't:
Humans can process two visual messages at the same time, but can
only hear one audio message.
In 2020, consider your brand’s demographic to truly stand out: When
your audience reaches for an audio experience, where do they go?
Streaming's continued rise in popularity, as well as increased
inventory makes ad breaks here a sure bet. Knowing that podcasts
have a small, but dedicated groups of consumers, it will likely take
additional research to ensure that you find the right message for
these people. And finally, voice is still finding its footing, but we
expect it to explode in the next year. Consider your opportunities
now instead of waiting for the technology to start catering
specifically to marketers.
23Sparkloft Media is a social-first creative agency driving growth through
engagement for clients such as Macy’s, Alaska Airlines and Warner
Bros. We’ve been solely focused on social media since 2007. Our
entire agency has been built around the unique needs of this area of
marketing and advertising. Social media is changing the world does
business. Sparkloft’s services help organizations around the world
understand these changes and use them to achieve their objectives.
Learn more at sparkloftmedia.com
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