Internet or online radio stations provide an advertising platform with a large potential audience. Approximately 143 million Americans listen to Internet radio, according to Edison Research. Although Internet radio advertising allows businesses to reach a targeted audience and can generate high ad response rates, it lacks the visual appeal associated with television advertising and advertisers have to contend with a highly fragmented audience.

Internet Radio Advertising Advantages

  • Targeted Reach: Through Internet radio advertising, advertisers can reach a target audience of young adults effectively. According to a 2015 survey conducted by Edison Research and Triton Digital, 77 percent of 12 to 24 year-olds listen to Internet radio monthly.
  • Increased Engagement - Since many Internet radio listeners use computers, smartphones and tablets, they are more likely to visit a website or social media page while streaming. This benefits businesses looking to drive traffic to their websites or blogs. A report published by the Interactive Advertising Bureau notes that 48 percent of  internet radio listeners respond to an ad over the period studied.
  • Flexibility - Internet radio advertising affords advertisers the flexibility to effectively integrate other forms of online advertising, such as web banner advertising, into their advertising strategies for greater effectiveness. When tuning in to their favorite stations, Internet listeners can visit the station’s website, which could be displaying the banner.

Internet Radio Advertising Disadvantages

  • Little Visual Appeal – Radio ads are typically delivered by voice. Without a visual component beyond a possible banner ad or a web presence you're asking readers to click to, Internet radio advertisers may find it difficult to create ads that are as engaging and stimulating as those that have both visual and audio elements.  Since consumers cannot see the product being advertised, the best they can do is form a mental image.
  • Fragmented Audiences – There are literally thousands of Internet radio stations, all broadcasting  unique music or shows. This leads to audience fragmentation, meaning advertisers may have to dig deeper into their pockets to secure ad spots in multiple stations in a bid to reach a larger audience.
  • Ineffective Local Reach - Internet radios typically are available to anyone -- regardless of their geographical position -- with Internet access. While this is an attractive prospect for national and global advertisers, Jeffrey M. Berry and Sarah Sobieraj, authors of The Outrage Industry;Political Opinion Media and the New Incivility, note that Internet radio advertising is ineffective for advertisers looking to reach a local audience.