Pandora says that listening on smart speakers like Amazon Echo and Google Home has grown by 282% since last year. Our friends at Business Insider did some math and concluded that equates to 1.6 million Pandora listeners using smart speakers. If true, that may represent 10% of all smart speaker owners in the U.S.
Smart Speaker Owners Like Audio Content and Streaming Music in Particular
Pandora commissioned a recent study with Edison Research to learn more about smart speaker usage habits. What it found should be illuminating to the entire industry growing up around voice assistants. Sixty-nine percent of smart speaker owners use the devices to listen to audio content generally while 58% listen to music that does not include radio. That should be Pandora’s sweet spot. The listening figures came well ahead of checking the weather (46%), asking general questions (40%) or setting a timer (27%).
The broader finding from this data is that three of the top four results involve using smart speakers for entertainment content and potentially a sliver of usage for learning. The utility functions such as timers, smart home control, calendar updates and general questions were the focus of early promotion in the category by Amazon and Google. All of those features have their value for different consumers. However, we are seeing the common usage is employing these devices for their easy access to audio content, including music.
Smart Speakers Important to Pandora’s Strategy
For Pandora, this growth of smart speaker listening has been a bright spot in a challenging environment for streaming services. While Spotify, Apple and Amazon have solidified clear leads as global streaming music subscription services, other services have had more tepid growth. Pandora has grown its premium subscription business by a small amount but total active users for its ad-supported business declined 2% in the second quarter. The BI article reported this comment from Pandora’s analyst call last month:
In the back half of the year, we will deepen our existing relationships with partners like Amazon, Google and Sonos, and add new partnerships to expand our suite of over 2,000 connected devices.
It wasn’t so long ago that many people thought of Amazon Echo as a novelty. Today, Echo and other smart speakers with AI-back voice assistants are seen as platforms to build future growth plans around. Things do change quickly.