Spotify and OMG announce second multi-million podcast ad deal

Spotify and Omnicom Media Group have announced a new, Europe-focused podcast advertising deal worth €15m (£12.8m).

The deal, which begins this month, is Spotify’s largest European ad deal to-date, and will begin primarily in France, Germany, Italy, Spain, and the UK with the potential to expand into additional European and EMEA markets.

Under the agreement, OMG and its agencies Hearts and Science, OMD, and PHD, will have first-mover access to new podcast ad formats, select Spotify podcast content across Europe, and early access to Spotify’s recently acquired ad measurement service Podsights.

Omnicom Media Group struck its previous deal with Spotify in the US for $15m in 2020; the new deal signals a continuation and expansion of the companies’ partnership.

“Advertisers are increasingly directing more of their media spend to podcasts as listenership grows and creators of all sizes embrace this uniquely intimate medium,” said Rak Patel, Head of EMEA Ad Sales at Spotify.

“We’re pleased that OMG has entrusted us to help them and their clients to realize the full value of podcast advertising. Our hope is that this deal leads to more innovation and growth in this space across Europe.”

OMG manages $35bn in adspend annually while Spotify surpassed €1bn in annual revenue for the first time in 2021.

In Q1 2022, Spotify’s ad revenue grew 31% year-over-year to €282m.

The agreement is a big get for Spotify, who this week announced it had formed a Safety Advisory Council and has partnered with the IAS to provide brand safety tools for advertisers who have been spooked by recent criticism levied against the streaming service for platforming disinformation and harmful speech.

Spotify also announced this week it would be slowing its hiring growth by 25%, according to a Bloomberg report, despite a signaled interest in expanding the company’s footprint into audiobooks.

The deal provides a boost to an industry that is shedding subscriptions in the wake of an economic downturn caused by rising inflation.