Internet Audio: Q&A With XAPPmedia's Pat Higbie

Pat Higbie, CEO of XAPPmedia, developed a passion for computers while studying civil engineering. He says, “I always enjoyed the problem-solving aspects of engineering, but I became enamored with the unbounded potential of information technology and the opportunities it affords for blazing new trails. This led to my career as a serial technology entrepreneur.”

His company focuses on voice-activated Internet audio, allowing listeners to engage with audio content by speaking even when the screen is locked and they are multitasking or ultramobile (e.g., driving, exercising, walking, working, viewing other apps, etc.).

Charlene Weisler: Tell me about your involvement in Internet audio.

Pat Higbie: My partner and co-founder, Frank Raines, and I recognized huge growth in Internet audio but saw this nascent market suffering from a misalignment between mobile audio content consumption and touch-based content interaction.
Touch works great for visual apps; however, voice is a more natural interaction paradigm for mobile audio consumers, who only have access to a device’s screen 10% to 15% of the time while listening.



Weisler: How do you apply that thinking to your company?

Higbie: Our customers are typically promoting engagement with content, artists or brands. A recent advertising example is StubHub, which wanted to drive downloads of its mobile app. After a ten-second audio pitch on the merits of StubHub, the consumer was prompted with a call to action that said, “to download the StubHub mobile app, after the tone say ‘download app.’”

If a consumer responded, the listener was automatically navigated to the app store ready to download the app.

Weisler: What data do you collect?

Higbie: We collect data directly on impressions, voice and touch conversions and listening environment: What happens, when it happens, how it happens. We compare this to data related to advertisement attributes such as advertiser, call to action, and ad duration.

Weisler: What metrics do you use in the field of Internet audio?

Higbie: We track impressions along with both voice and touch conversions. In addition, we track action types, ad duration and listening environment – for example headphones, speaker, Bluetooth – and whether the app is visible on the screen when the ad plays.
Going further, we compare performance based on time of day and day of week against other ads during the period. We can also track on which impression each conversion occurs and the ad efficacy based on impression frequency. This can be viewed from an ad perspective or rolled up into a campaign.

Weisler: How do you see the media landscape changing in the next five years, and how might that impact your business?

Higbie: I see double-digit annual growth in digital media audiences dominated by a shift to mobile consumption. After three years of streaming audio subscriptions growing as a percent of industry revenue, advertising will make a strong comeback, from its 54% of revenue share today to approach 60% again by the end of 2017.

In the interim, the Apple Music – Spotify subscription wars will keep subscription revenue high while simultaneously bringing more audience into freemuim, ad-supported listening. By 2020 advertising will likely be back at the 66% level it enjoyed in 2011-12 as reported by IFPI data.

The key drivers of the rise in advertising revenue will be better targeting, an increase in the number of advertisers, and ad formats optimized for the mobile audio content interaction model. This will increase CPM rates for ad-supported listening without increasing ad loads. It also ties into one other prediction.

Ad loads will not increase substantially in streaming audio because of stiff competition for listener growth. XAPPmedia’s voice-activated consumer engagement technology is helping mobile audio publishers adjust to the market shift to high CPM, ad-supported listening.

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