Pandora offering one hour ad-free music – if you engage with ads

Pandora’s 3 million+ Australian and New Zealand users will soon be offered a new deal from Pandora – an hour of uninterrupted listening if they engage with one 15 second ad.

It’s an extension of the Sponsored Listening ad service it unveiled on beta last September for 20 select brands. A click on a brand ad would lead to a short video (anything from 15 seconds to 2 ½ minutes) which provides a greater interactive profile of a product including 360-degree views and a slide show. Accessing the video unlocks an hour of ad-free listening paid for by the brand. In America, the ad-free option, Pandora One, would cost $4.99 per month.

Jane Huxley,Managing Director, Australia and New Zealand at Pandora told TMN:"Brand advertisers are an integral element of free streaming services. The number one need of Brands today is to reach consumers in a targeted way but at scale. The free tier provides the volume required.In addition it also feeds the digital ecosystem we’ve created between Bands, Brands and Fans, bringing together all of the key stakeholder groups for Pandora".

According to Pandora USA, the strategy has received a positive response, with increased purchase intent up by 30% and brand awareness by 12%. Now it is available to all advertisers and its 81.5 million active listeners (listener hours for the fourth quarter of 2014 were 5.20 billion. 80% on mobile). It rolled out in the United States this week and will be available in Australia “within months”.

It’s a smart way by Pandora to increase its ad revenue without spoiling the user experience. Pandora, already under pressure from Apple’s Beats 1 and Google Play Music, reported ad revenue growth slowed to 35.9% in the fourth quarter of 2014 ending December 31, from 39.5% a year earlier.

Lizzie Widhelm, Pandora’s SVP of advertising product strategy and sales said in a statement:“As the competition for consumer attention continues to intensify, brands are looking for advertising products that can help them create a lasting impression and resonate with their target audiences.“Sponsored Listening enhances our suite of engagement-based advertising solutions by building on products such asBrand Stations, and is another manifestation of our philosophy that what’s good for the listener is good for the advertiser.”