Digital Gabe
Cutting Edge Commentary On All Things Media

iHeart Is Building A Self-Serve Ad Platform

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During last week’s Q3 earnings call iHeart CEO Bob Pittman debuted a new initiative called AdBuilder.  It’s an automated self-serve platform which creates and runs audio ads for advertisers.  According to Pittman, once the advertiser listens to their ad, approves it, and decides on a budget and start date, AdBuilder’s automated process creates a media plan and traffics the campaign.

This is iHeart’s attempt to claw back local media budgets which have been devoured by Google and Facebook, who invented the self-serve ad buy game.  In theory AdBuilder could help give iHeart an offering to compete with the Duopoly.  But keep in mind there’s a reason why Facebook and especially Google are miles ahead of the digital media industry when it comes to ad sales.  Their billion plus user scale, walled garden of data, and retargeting capabilities are hard for the average digital pub to compete with.  (If you want a good side read on how utterly dominant Google is in the ad sales space check out this WSJ analysis.)  Needless to say iHeart, with its non-registered broadcast audience, will have quite a mountain to climb to compete with these guys.

The other problem with AdBuilder is the fundamental difference in how an audio ad works compared to a display or search ad.  Just one digital ad can lead to a click and then a conversion.  In contrast audio campaigns typically require frequency, which means larger ad budgets and a more sophisticated media plan.  So a small business buying a couple hundred dollars in over-the-air-audio ads probably isn’t going to move the needle much.

To me this feels like something that looks good on paper but won’t actually work.

 

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