In 2014 Pandora was the best-known internet radio service in the United States. It was free to listen, paid for by advertising, and it knew a lot about its listeners, which made it one of the most talked-about places to buy audio ads online.
What Pandora is
Pandora is a personalised radio service. A listener starts a station from a favourite artist, song or composer, and Pandora plays similar tracks chosen by its Music Genome Project, a catalogue of songs described by hundreds of musical attributes. Thumbs up and thumbs down teach each station what to play next. The free tier was supported by ads, and that ad inventory is what this post is about.
How Pandora sold advertising
- Audio ads: short spots, usually 15 or 30 seconds, played between songs. Only one ad plays at a time, so it gets the listener's full attention.
- Display ads: banners and skins around the player on the web, plus companion banners on mobile while an audio spot plays.
- Video ads: sponsored video shown while the listener was looking at the app or the web player, a format Pandora later extended with opt-in ads that unlocked a stretch of ad-free listening.
Every listener registered with a birth year, gender and ZIP code, so Pandora could target by age, gender and location without guesswork. It added targeting by music genre, station type and device, and sold most inventory on a cost per thousand impressions basis.
| Pricing model | CPM (cost per thousand impressions) |
|---|---|
| Premium targeting | From around $20 CPM |
| Run of network + geo | Lower than premium packages |
| Targeting | Age, gender, ZIP code, genre, station, device |
| Formats | Audio spots, display banners, video |
| Audience | Mostly in the United States |
These figures came from rate information shared with advertisers at the time and quoted by publishers like us. Large buyers negotiated their own rates, and prices moved with the season, so treat them as a guide rather than a price list.
How big the audience was
Pandora reported close to 50 million monthly active listeners in early 2012, and more than 70 million by 2014, almost all of them in the United States. Research firms at the time agreed that online radio listening was growing fast, and that a large share of Americans already listened to some form of digital audio every month.
Why audio CPM costs more than banner CPM
A banner competes with everything else on the page. An audio spot on Pandora played alone, often while people were working, driving or exercising, and the station kept playing music the listener had chosen. That is why audio CPMs sat well above typical banner CPM costs and closer to online video. If you want to compare audio with other channels, convert every deal to eCPM first.
Who buys streaming audio ads
Pandora's early buyers were car makers, retailers, telecom companies, entertainment brands and many local businesses that used the ZIP code targeting like a digital version of local radio. Later a new group joined them. After US states began to legalise sports betting in 2018, sportsbooks and online casino brands became regular buyers of streaming audio, especially during the football and basketball seasons. Gambling advertisers can only target states where they hold a licence, and the location data that audio platforms collect makes that easy. Our guide to sports betting advertising around big events shows how those campaigns follow the sports calendar, and iGaming CPM and CPC rates by country explains why betting brands pay above-average prices for the right listener.
Pandora today
Sirius XM bought Pandora in 2019, and Pandora's advertising is now sold together with the other SiriusXM audio properties. Much of it is bought programmatically, like display and video. The basics have not changed: one ad at a time, a logged-in audience and strong location targeting.
SiteAdWiki verdict (2014): Pandora was a strong choice for advertisers who wanted audio reach in the United States with real targeting. It was not a channel for small budgets, and publishers could not sell its inventory, but it set the benchmark price for online audio.
