Programmatic Audio Exchange DAX Inks Deal to Offer Voice-Activated Ads

Company hopes the format brings better engagement measurement

Voice-enabled ads are gaining traction in the U.S. Getty Images

European radio giant Global’s digital ad exchange has signed a deal with voice-activated ads company to expand the availability of interactive audio ads in the United States.

The partnership will allow advertisers on Global’s DAX, which claims to be the world’s largest digital audio ad platform, to place ads with verbal prompts in streaming mobile audio apps like TuneIn, Bauer Media’s KissFM and AccuRadio. While the ads won’t be sold programmatically for the time being, DAX hopes to eventually integrate the nascent format into its exchange.

News of the deal, financial terms of which were not disclosed, comes as the digital and programmatic audio space is experiencing growing pains around metrics issues. The Interactive Advertising Bureau estimates that digital audio advertising as a whole grew 31 percent last year to reach $935 million in revenue, but the automated side of the business has stalled due in part to a lack of consistent measurement standards and comprehensive engagement tracking tools, according to eMarketer.

“The reason that we’re launching this partnership now is we are very focused on getting engagement and attribution right in the digital audio space,” said Matt Cutair, CEO of DAX’s U.S. business. “This allows us to provide [brands] with better campaign metrics and reporting as to what happens when they ran an ad.”

Cutair said DAX was encouraged by the engagement Instreamatic clocked in several test campaigns in the U.S. and Russia, where the company has deals with three major radio groups. In a U.S. campaign Instreamatic recently ran for ebook subscription service Bookmate, for instance, the company served a short audio tease that instructed users to respond with “get the app” if they were interested. A response would prompt a download screen, while a negative reply would end the ad.

Instreamatic claimed a response rate of close to 13 percent. Campaigns in Russia for Mastercard and a smartphone manufacturer and mobile payment system that the company said it couldn’t name yielded similar results with engagement numbers ranging from 11-14 percent. The company wouldn’t reveal the total number of times the ad was served in each of the campaigns but did say the Mastercard pilot reached more than half a million people.

Instreamatic CEO and co-founder Stas Tushinskiy said the company was also surprised to find that people tended to continue to use voice commands with the ads even after reaching an on-screen prompt.

“We see from the numbers that people still prefer to talk if they can, and that was really interesting—when we first saw it we were a little bit shocked and surprised,” Tushinskiy said. “Voice is the easiest way to input information into a device and that explains why even if you can tap and swipe, you still prefer to talk because it’s easier.”

Instreamatic claims to use machine learning to hone the scripts and structure of the ads based on performance and AI-based natural language tools to interpret vocal responses.

Tools like these may help the programmatic audio space finally reach a tipping point as its disparate technology becomes more integrated in a way that provides the scale necessary to attract more advertisers, according to Cutair.

“We’re seeing some pretty good uptick in activity,” Cutair said. “I think a lot of that has to do with the tech consolidation that’s happened in the market over the last year or so with Pandora acquiring AdsWizz and launching their programmatic capability, with Spotify being at the forefront of making their inventory available programmatically and with Global acquiring a majority stake of our business here in the U.S.”

Cutair said programmatic audio buying has grown more overseas because digital audio didn’t reach certain markets until automated ad technology was already widespread, meaning there were no legacy operations to replace as there were in the U.S.

“When they launched Dax in the U.K. in 2014, it was the first time that digital audio had been bought and sold in that market and it was launched in the era of programmatic and so it was built at the agency’s behest for programmatic transactions,” Cutair said. “Whereas in the U.S., we’ve been buying and selling digital audio for more than a decade predating the era of programmatic.”

@patrickkulp Patrick Kulp is an emerging tech reporter at Adweek.