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August 30, 2011 / jasonpinto

The Business of Mobile Advertising

Headphones

Maybe I should not have been surprised by this.

But the headline “Mobile Ads Now Claim Half of Pandora’s Total Ad Revenue” absolutely caught my attention this week.

Since mobile advertising is reaping positive results for Pandora, I thought it’d be worth exploring why they might be having success in an area that so few companies have dived into.

3 Reasons Why Mobile Advertising Is Working for Pandora

The Captive Audience:

If Pandora has one thing, it’s a passionate and committed audience. Many of its supporters swear by the service even if there might be other music options available on the web with a better selection. Many of these people use Pandora for long periods of time; once they’ve turned it on, it’s on for good. They are not looking to browse for another “channel” if a one song doesn’t suit their taste. Because the listeners are fairly committed to listening to Pandora, mobile advertisements may not necessarily be unwelcome.

If listeners are generally happy with the songs being played and they’re not apt to change where they are getting their music from, the advertisements may fit nicely into the stream.

Personalized Offers & Content:

One of Pandora’s big selling points has always been that they can make radio become a personalized experience. They are able to learn someone’s likes and dislikes. They may be able to discern and/or gather demographic information. With that data in hand, they certainly have the ability to serve up personalized advertisements that may appeal to the listener.

Multiple Touches, Multiple Senses:

From my own personal experience, advertisements on Pandora tend to be repeated on a fairly frequent basis. I’m sure this varies based on spend, demographic information, and other items… but for the most part, I hear the same advertisement multiple times each day. And guess what: even the bad ones tend to stick in my head!

Another thing that works to Pandora’s advantage is that their advertisements can touch people across multiple senses. If you were to look down at your phone, you’ll see the graphics from the advertisement. Meanwhile, you’re hearing the advertisement through your speakers as well. That multiple-touch, multiple-senses approach can certainly help to increase the impact of the advertisements.

Moving Forward

Yes, Pandora is certainly in a very good place to capitalize on the growing mobile advertising space. But maybe they are not the best place for you to try some mobile ads on. But even if that is the case, you may be able to borrow some inspiration on why things are working well for Pandora right now.

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