Heidi Browning, SVP of strategic solutions at Pandora Internet Radio, discusses the company’s success in advertising where, according to eMarketer, the company ranks third in mobile ad revenue, behind only Google and Facebook. She points out that mobile audiences more than terrestrial audiences are where Pandora is most effective in terms of driving awareness and deciphering purchase intent.
Pandora remains immensely popular. Last October, listeners tuned in for a combined 1.47 billion hours, an increase of 18% from the same time last year—and all this despite the September launch of Apple’s iTunes Radio service.
Please provide an overview of Pandora’s targeting capabilities.
We have over 100 ways to target on Pandora. Our first-party data is the foundation. We have a 100% registered user base, and one of the largest logged-in user bases on mobile. We’re right behind Facebook. We build on there to add more targeting segments besides age, geography, and gender. We layer on your engagement with Pandora, your listening behavior, whether you’re skipping songs, or sharing new stations. Those are all opportunities for us to target.
Do you incorporate third-party data?
We layer on top the ability to bring in third-party data around lifestyle or life stage; so, pet owners or parents, a Latin or Hispanic audience, high income holders.
When it comes to segmentation, who’s creating the segments? Pandora or your enterprise clients?
Right now it’s Pandora creating the segments. We have proprietary segments, third-party augmented segments. We have the ability to do custom segments for clients based on a data-based match. That’s the next generation of targeting for us, but it’s not self-serve yet.
What sort of custom segments do you provide?
Take our proprietary audience segment; it gets really interesting when you start to look at the musical behaviors and interaction. We can look at political affiliation, regional differences, what types of devices [end-users are] listening on, etc.
We continually fine-tune and build out our proprietary segments. We work closely with our data scientist team to come through the billions and billions of data points we have on our audience to understand where they fall into these segments, their device usage, the kind of music they listen to, and how that maps to their offline purchases and intentions. That’s our big focus.
Is your advertising mostly digital or audio? I imagine most people listening to Pandora on mobile aren’t visually interacting with the app.
We do all of the above—targeting cuts across every one of our ad products so we know we’re delivering just the audience the client wants. We do [both] audio and video. We’ve got two different types of ad opportunities. Audio is the killer ad for the reasons you talked about. We deliver audio messages throughout your experience. You might see a visual ad when you first start up and that’s the welcome experience and that’s the first impression you see. You hear audio throughout unless you engage with the station. Display ads happen upon engagement with mobile device, so only if you’re looking at the screen, like changing the artist.
What are your audience targeting strategies?
It starts with the target audience and the [client] objective. Say a venue wants to sell tickets, say you want to laser target on the right day to the right audience. Who do you want to reach? We look into our suite of products to add to that to drive against their goals. We start with basic targeting across everything. Rather than going mass, let’s say you want to target teens 13 to 17; we’ll start there. If you want to target teens 13 to17 in Chicago, we take it down another layer. Then you look at what are the most effective ads for teens based on their behavior on mobile, so we might home in on mobile. Then we do a combination of audio and display ads, or a branded radio station, to make sure we’re engaging the user through their session.
How do you determine the success of a campaign?
There are lots of ways to track success and it goes back to the marketers’ objective. For those trying to track brand metrics whether they’re upper or lower funnel, we layer on brand impact studies, so we can show those who’ve been engaged with the advertising and how that moves [client] metrics.
We also look at the actual engagement rate with each ad and have the advertiser come back and tell us how we did—whether it’s traffic through a website or lower-level traffic in a store. We look at their external metrics. We are moving to a world where we’re working with the MMA (Mobile Marketing Association) and other providers to map that offline purchase to exposure to mobile advertising on Pandora. That’s the next frontier: Mapping exposure data to offline data to see if we actually move the needle.
Has Pandora had these targeting capabilities since its inception?
We’ve been doing advertising [since 2005]. (Ed: Pandora Radio launched in July 2005).
Advertising is our oxygen—what’s been wonderful is that the product team values advertising as much as the advertising team values the product.
We’ve had targeting since the beginning. We embarked on our mission to fundamentally change the way people listen to music and to disrupt the radio category. We wanted to make Pandora as free and ubiquitous as radio.
