Is Spotify Advertising Worth It for Small Businesses? The Complete Beginner’s Guide
In today’s digital world, finding affordable yet effective advertising channels can feel overwhelming for small to medium business owners – especially in New Zealand. While advertising on social media, Google, and traditional radio, print or TV may be familiar options, there’s another powerful platform that deserves your attention: Spotify.
With over 675 million users worldwide and growing popularity in New Zealand (over 1 million Kiwis have an account), Spotify offers unique advertising opportunities that won’t break the bank. But how exactly does it work, and is it right for your business? Let’s dive in.
What is Spotify Advertising?
Simply put, Spotify advertising allows businesses to place audio ads between songs for listeners who use Spotify’s free service. These ads typically run for 15-30 seconds, similar to radio ads but with some significant advantages.
Unlike traditional radio, where ads are broadcast to everyone tuning in regardless of who they are, Spotify can deliver your message to very specific groups of people based on their age, location, interests, and even music preferences.
How Does Spotify Advertising Work?
Spotify’s advertising system is surprisingly straightforward:
- You create an audio ad – This is a short audio message that plays between songs
- Choose your target audience – Select who you want to reach based on various factors
- Set your budget – Decide how much you want to spend
- Launch your campaign – Your ads start playing to your chosen audience
- Track results – See exactly how many people heard your ad and clicked through for more information
One of the most appealing aspects of Spotify advertising is its accessibility. You don’t need a massive marketing department or years of experience to get started.
Why Should Small New Zealand Businesses Care About Spotify Advertising?
Affordable Entry Point
Got a small advertising budget? No worries.
You can start advertising on Spotify with as little as $250 per month. This is significantly lower than traditional radio campaigns, which often require commitments of thousands of dollars.
Professional Production Without the Price Tag
One common concern we hear from our clients is: “Do I need to record my own audio ad, or does Spotify help?”
The great news is that Spotify can produce your ads for you within that $250 minimum spend. You’ll get to select from local voice talent and choose backing tracks that match your brand’s vibe. No need for expensive recording studios, production teams or having to do it yourself!
Quick Turnaround
In our experience working with NZ businesses (regardless of being a start-up or enterprise), Spotify’s production process is remarkably efficient. From submitting your brief to receiving your finished creative, the turnaround is usually less than 24 hours on a working day. This means you can respond quickly to market opportunities and even viral trends without lengthy delays.
Precision Targeting That Traditional Radio Can’t Match
If you’re thinking yeah this sounds good… but how does Spotify target ads? This is where the platform truly shines compared to traditional advertising channels.
Spotify allows you to target your audience based on:
- Age and gender – Reach specific demographic groups
- Location – Target listeners in particular regions, cities or even neighbourhoods in New Zealand
- Interests – Connect with people who have specific hobbies or passions
- Devices – Target users on mobile, desktop, or smart speakers
- Music preferences – Reach listeners of specific genres that align with your brand
- Listening habits – Target casual listeners or power users
This precision means your advertising dollars work harder because you’re reaching exactly who you want to talk to.
Measurable Results
Another question we’re often asked is “Do businesses see good results from advertising on Spotify?”.
Unlike traditional radio where results are estimated (through surveys conducted by a third party in NZ), Spotify provides actual measurable data. You’ll see exactly how many people heard your ad, what percentage listened to the entire message, and how many clicked through to learn more.
In our experience managing campaigns for New Zealand businesses, we’ve seen ads with properly targeted audiences achieve over 90% completion rates—higher than Spotify’s own benchmarks. This means people are actually listening to your messages rather than tuning them out.
What Types of Ads Can I Run on Spotify?
Spotify offers several ad formats:
- Audio Ads – The standard 15-30 second spots that play between songs
- Video Ads – Short video content that appears when the app is in focus
- Display Ads – Visual ads that appear in the Spotify interface
- Sponsored Playlists – Branded playlists that can feature your business
For most small businesses just starting out, audio ads with static companion images are the most cost-effective option. These allow you to deliver your audio message while also showing a simple visual when users look at their screen.
Can I Target Podcast Listeners Specifically?
Yes! This is another powerful feature of Spotify advertising. With the growing popularity of podcasts, you can specifically target listeners of certain podcast categories that align with your business. This allows you to reach highly engaged audiences with interests relevant to your products or services.
How Much Does It Cost to Advertise on Spotify?
As mentioned earlier, campaigns start at around $250 per month, including production costs. The actual cost will depend on:
- How many people you want to reach
- How specific your targeting is
- How competitive your chosen audience is
What’s particularly notable is that our clients have achieved brand uplift results comparable to radio campaigns costing several times more. Think about Spotify as you would with Google Search Ads, the targeted nature of the platform means you’re not paying to reach people who will never be interested in your business.
Real Results for New Zealand Businesses
Is Spotify advertising worth it for small businesses? Based on our experience managing campaigns for local companies, the answer is a resounding yes—when done correctly.
We’ve seen businesses across various industries—from retail to professional services to finance companies —achieve impressive results with modest budgets. The key is creating the right message for the right audience that instantly grabs attention.
The most successful campaigns typically:
- Speak directly to a specific need or desire of the target audience
- Include a clear, simple call to action
- Maintain a conversational, authentic tone
- Take advantage of Spotify’s targeting capabilities to reach niche audiences
Getting Started with Spotify Advertising
If you’re considering Spotify as part of your marketing mix, here are some practical steps:
- Define your objective – Are you looking to build brand awareness, promote a specific offer, or drive traffic to your website?
- Identify your ideal audience – Who are you trying to reach? The more specific, the better.
- Craft a message that resonates – Keep it conversational and focused on how you solve a problem for your listeners.
- Set a realistic budget – Start small if you’re unsure, and scale up as you see results.
- Monitor and adjust – Use the analytics Spotify provides to refine your approach over time.
In an increasingly fragmented media landscape, Spotify represents a unique opportunity for small and medium New Zealand businesses to reach targeted audiences efficiently and affordably. With low entry costs, professional (and quick!) production support, precise targeting options, and measurable results, it’s a platform worth exploring as part of your marketing strategy.
Whether you’re completely new to digital advertising or looking to diversify beyond your current channels, Spotify offers an accessible way to get your message to the right ears at the right time.
Ready to explore how Spotify advertising could work for your business? We’d be happy to chat about how our team has helped businesses like yours succeed on the platform. Get in touch by calling us on 0800 2666 245 or by completing our contact form and we will be in touch with you soon.