Home Digital Audio and Radio Pandora’s Q1 Ad Revenue Up 45%, But Pressures To Engage Users Are Rising

Pandora’s Q1 Ad Revenue Up 45%, But Pressures To Engage Users Are Rising


PandoraInternet radio service Pandora reported Thursday a 69% year-over-year increase in Q1 revenue to $194.3 million. Advertising revenue rose 45% year over year to $140.6 million. Subscriptions and other revenue were up 94% at $39.5 million compared to the prior year.

Mobile advertising RPMs (ad revenue per 1000 ad-supported listener hours) reached $29.46 in Q1 this year in a 44% increase from the same quarter last year.

Despite this uptick in mobile, CEO Brian McAndrews said Pandora doesn’t have immediate plans to integrate programmatic mobile capabilities into its offerings, adding he “sees an opportunity in programmatic display” but the space is still “in its early days.”

Pandora instead appears to be focusing on growing its sales team (it has 100 sales people across 37 local US markets) and on driving further engagement.

Engagement is especially important: Pandora saw a 12% increase to 4.8 billion listener hours for Q1, this isn’t as much of a jump as Q4 2013, when it reported a 16% increase.

While this gap could be attributed to seasonal influences, growing listening hours, improving monetization and managing content are company priorities, McAndrews said during the earnings call.

The service also faces a number of challenges. As competitors like Apple, Google and Spotify nip at its heels, Pandora may be running out of new users.

Pandora, which has 250 million registered users over the age of 13, is acutely aware of the importance of driving new users.

“There are about 270 million people over the age of 13 in the US,” said Pandora CMO Simon Fleming-Wood at Forrester’s Forum for Marketing Leaders earlier this month. “So the marketing challenge for Pandora is how do we grow our share of people listening (to music)? How do we get them more engaged, more often?”

In an effort to drive further engagement, Pandora is increasingly focused on cross-device listening features and automotive advertising.

In January, Pandora launched an automotive ad solution that is designed to let advertisers reach car-bound audiences through 15- and 30-second audio spots that run across vehicle models that integrate into Pandora. Consumers are more accustomed to a higher ad load in cars than they are to ads on mobile devices, McAndrews said, which gives Pandora “a lot of opportunities through targeting, paid listening and subscriptions.”

McAndrews did not discuss Pandora’s strategy for enhancing its offerings for hand-held devices or connected TVs, except to note that the company is consistently trying to further improve its playlist technology across devices.

Must Read

Nope, We Haven’t Hit Peak Retail Media Yet

The move from in-store to digital shopper marketing continues, as United Airlines, Costco, PayPal, Chase and Expedia make new retail media plays. Plus: what the DSP Madhive saw in advertising sales software company Frequence.

Comic: Ad-ception

The New York Times And Instacart Integrate For Shoppable Recipes

The New York Times and Instacart are partnering for shoppable recipe videos.

Experian Enters The Third-Party Data Onboarding Business

Experian entered the third-party data onboarder market on Tuesday with a new product based on its Tapad acquisition.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters

Albertsons Takes Its First Steps Into Non-Endemic Advertising, Retail Media’s Next Frontier

Albertsons is taking that first step into non-endemic advertising next week via a partnership with Rokt to serve ads to people who have already purchased groceries.

Marketecture Buys AdTechGod (No, Really)

Marketecture has acquired AdTechGod – an anonymous ad tech Twitter poster turned one-man content studio – and the AdTech Forum, an information resource hosted by AdTechGod and Jeremy Bloom.

Why The False Advertising Lawsuit Against Poppi Is Bad News For RMNs

This week’s dispatch explores the new trend of false advertising class-action suits in the food and CPG industry and how the evolution of online, data-driven retail media could exacerbate the problem.