The Audio Advertising Loop
Using audio ads as a way to grow revenue
An Audio Advertising Loop is a type of growth loop that involves using audio ads as a way to attract new users, increase engagement, and generate revenue. In an Audio Advertising Loop, the more users engage with a platform, the more ad impressions the platform generates. This, in turn, generates more revenue, which can be reinvested in growth initiatives like product development, user acquisition, and retention.
Audio Advertising Loops are commonly used by companies that offer audio-based products or services, such as music streaming platforms or podcasts. By playing short audio ads to users, these platforms can generate revenue while also promoting their own products and services, as well as those of their partners.
For example, the music recognition app Shazam has used an Audio Advertising Loop to fuel its growth. Shazam plays short audio ads when users are trying to identify a song. As more users use the app, the number of ad impressions increases, which in turn leads to more revenue for Shazam, allowing it to invest more in growth and product development.
Paired with other growth loops like network effects or referral marketing, an audio advertising growth loop can be a very effective way to grow revenue where there’s minimal competition from others.
Some companies that effectively use an Audio Advertising Loop as part of their growth strategy are:
Spotify: The popular music streaming platform offers both free and premium versions of its service. The free version is ad-supported, and users hear short audio ads in between songs or during breaks in podcasts.
Pandora: Another music streaming platform that offers a free, ad-supported version. Like Spotify, Pandora plays short audio ads in between songs or during breaks in podcasts.
iHeartRadio: This platform offers access to live radio stations, podcasts, and music streaming. Users of the free version hear short audio ads during breaks in content.
TuneIn: A platform that offers access to live sports, music, news, and podcasts. TuneIn offers a free version supported by audio ads.
SoundCloud: A music streaming platform that also allows users to upload and share their own music. SoundCloud offers a free version supported by audio ads that play in between songs.