Pretty soon your Ellie Goulding Pandora station will be playing an ad asking you to vote for Newt Gingrich. With social media websites such as Twitter and Facebook dominating the ad business, Pandora is looking to boost revenue via new political ads. The ads will be targeting voters based on the zip codes they entered when users sign up for an account. Since the service already focuses on making a connection between the songs and each person by knowing which song to play next and recognizing which songs users have skipped, there’s no doubt that they won’t be able to do that with demographics and political candidates. Thus, Pandora can target ads to specific areas such as congressional districts in the same way they customize songs depending on their listeners’ preferences. Already passing age, gender, song, artist, and genre preferences to third party businesses to personalize advertisements, Pandora will now be passing along zip codes. Ever wonder why you’ve been hearing ads for business located in Boston? Political campaigns can now target by country, state, metropolitan survey areas (SVA’s) and designated market areas. With the new electoral season right around the corner, political advertisers have become conscious of how powerful a marketing tool personalized, internet radio could be. Pandora’s chief revenue officer, John Trimble, emphasized that “internet radio is a powerful platform to reach a desired set of voters.” It will eliminate money spent on ads that go to waste and don’t really effect voters, such as a multitude of television commercials.
Currently, Pandora is in knee deep competition with rising music providers such as Spotify, it must seek to bump up revenue some where else. The ad business area is a great place for Pandora to finally increase their profits, considering their stock has slid 23% since the company went public in June. According to documents filed with the SEC in September, advertising was 87% of Pandora’s second quarter revenue. On a side note, Pandora however, does promise a clean marketing environment, bringing attention to the fact that only one audio ad is played at each commercial break.