Why Your 2025 Ad Strategy Needs Targeted Advertising

Let’s cut to the chase: Digital audio reaches 76% of Americans ages 12 and up. That’s a lot of people—and a lot of different people, in fact. Are your target consumers comedy-loving teens or pop-listening, pet-owning DINKs? No matter who they are, you can find them listening to their favorite audio throughout the day, wherever they are and whatever they’re doing. 

To modernize your ad campaigns and strategy, toss the one-size-fits-all approach out the window. This is where targeted advertising comes into play. Below, dive into targeted ads, their benefits, and how the various targeting options can take your marketing campaign to the next level. 

What Is Targeted Advertising? 

Imagine a billboard you pass daily advertising dog food. The sign is there for everyone: Dog owners, dog haters (if such people exist), and those with a terrible dog allergy. This is one of the many examples of a non-targeted approach, where an ad is displayed to many people at once rather than tailored to the behaviors and preferences of a particular group. The ROI is probably what you expect; many end up passing the billboard without a second thought—and taking no consumer action. 

The opposite (and better) approach is targeted advertising, a strategy where brands deliver a customized ad to a specific audience based on their demographics and interests. This approach uses data collected from user activities to deliver an ad experience that will be relevant and resonate with the consumer. Targeting advertising beats non-targeted advertising any day, with results like improved campaign performance and high return on ad spend (ROAS). 

There are a number of targeted advertising solutions and strategies. With SiriusXM Media, brands can choose from our menus of targeting capabilities, including audience, contextual, inventory, and advanced. Whether you want to reach parents, rock enthusiasts, or West Coast-based consumers, our diverse pool of 160M US monthly listeners has the audience profile(s) you’re looking for.

What Are the Benefits of Targeted Advertising? 

Targeted advertising offers a variety of indisputable perks for both advertisers and consumers. Here’s why today is the second best time to invest in the power of targeting for your ad campaign. 

Improved Campaign Performance

Consumers value authenticity and personalization in a world full of almost endless consumer choice and brands fighting for their attention. And this is exactly what targeted ads can deliver—a message that seems like it was recorded just for that individual. This approach results in higher satisfaction, better user engagement, and better brand perception. After all, you’re not just throwing spaghetti at the wall to see what sticks; you’re actually delivering relevant, personalized content. By focusing on listeners who are more likely to notice and appreciate your product, you’re boosting the likelihood of brand consideration. 

In a past campaign, a large health insurer partnered with us to better inform their target audience of their offerings before the start of open enrollment. The client used a mix of precision geo and audience targeting capabilities to reach their ideal consumers. And this approach paid off; the campaign saw a 40% ad click-through rate to the brand’s site and 230K total brand site engagements across page visits, button clicks, and form submissions combined. 

High ROAS

Considerable ROAS is another significant benefit of using targeted advertising in your marketing strategy. There are a few reasons why targeted audio ads make marketing budgets work smarter, not harder, and bring impressive results. 

For one, you can focus resources on an audience that is actually interested in hearing your ad and is more likely to take action. Additionally, targeted ads allow for real-time optimization and campaign fine-tuning, which enables more efficient budget allocation.

To put this to the test, we worked with a major CPG food brand to run a digital audio campaign with Pandora streaming. The campaign reached both a general audience and targeted parents, striking a balance to reach new and existing buyers, delivering a $3.84 ROAS, 68M impressions, and a 3.4% sales lift.

Better Data Insights

Improved campaign performance and high ROAS are always welcome, but don’t forget about the added awareness targeted ads bring. Targeted advertising benefits your brand on a deeper level and helps you better understand your customers. Thanks to the large amount of collected data and the opportunity for comprehensive analysis, targeting opens a window of valuable insights into your audience's behavior and preferences. Looking over this data, in turn, helps inform future marketing decisions, optimizes your campaigns better, and delivers better experiences in the future. If that’s not a win-win, we don’t know what is. 

What Are the Main Types of Ad Targeting? 

Targeted advertising comes in many different forms, so it’s up to advertisers to decide which one is best to increase their campaign’s efficiency and returns. Below are the various types we offer to help your business reach the right crowd, at the right time, and in the right place. 

Audience 

Audience targeting is the reliable, battle-tested method for delivering your message to the right listener. You can start with the basics and reach your audience based on demographic or geographic variables—target by age, gender, state, or DMA. Or take it even further by using predictive audience targeting, which is based on 300+ predictive behaviors including TV-viewing patterns, life stage, and purchase intent. 

Contextual 

Contextual targeting shifts the focus from who your perfect audience is to what they listen to, using data like listening device, location, and music preferences. Take, for example, a kitchenware brand advertising during a popular food podcast around dinnertime. In an age where digital privacy is of ever-increasing importance, contextual targeting is built upon user-shared feedback and wins the hearts of your listeners without being too intrusive. 

Contextual targeting comes in many forms, including mood, activity, brand suitability, transcription, and more. When you lean into the right one, you deliver an ad that never feels out of place. In the past, we saw a 73%+ validation rate for our activity and mood targeting.

Inventory

Inventory targeting is specific to podcasts only and could be your secret weapon in maximizing ROAS and making your audience go, “Hey, this brand really gets me!” With this in your arsenal, you can reach audiences tuned in to specific publishers or exclude shows that don’t align well with your brand. For starters, you get to choose a specific show or network where your ad appears, also known as inventory source targeting. For example, advertise on the Pitaya network to reach Hispanic listeners with your new Spanish-language campaign. Or leverage show anti-targeting to decide where your ads may run. 

This targeting type becomes a powerful tool with which you can choose not only where your ad appears, but also when your audience will hear it. Want to include a mention of your business pre-roll to increase your brand recognition? Or take advantage of higher user engagement with mid-roll ads? Done and done.

Advanced 

Think the above targeting options were already advanced? There’s still more to see. Advanced targeting is like enlisting a bloodhound to help you sniff out your ideal customer. This solution utilizes the latest technology to find patterns that take your targeting game to the next level. 

For example, you can re-engage users who have previously shown interest in your product with retargeting. Or leverage lookalike modeling, which helps you reach new customers based on similar existing audiences. 

Which Targeting Solution Is Right for Me and My Campaign? 

Choosing the right targeting approach depends on your campaign goals, the existing data you have to work with, and whether you’re advertising on streaming or podcasts (or both). But don’t fret—if you’re new to targeted audio ads, all you need to get started is the right partner by your side.

As you can see, the sky’s the limit when you combine a ready-to-experiment attitude, the latest targeting capabilities, and, ahem, yours truly. Want to see how targeting can take your ads to the next level? Let’s talk.

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