Spotify has recently extended its advertising capabilities in India by launching the Spotify Ad Exchange (SAX) platform and introducing AI-powered advertising tools. This move, announced on April 14, 2025, comes shortly after a global rollout and a successful pilot program in the U.S. and Canada. The introduction of SAX and AI-driven ad solutions aims to provide Indian advertisers with enhanced access to Spotify's user base and more efficient methods for creating and managing campaigns.
The Spotify Ad Exchange (SAX) is a programmatic advertising platform designed to automate the process of buying and placing ads on Spotify. It operates on a real-time bidding (RTB) model, where advertisers can bid for ad slots in real time through demand-side platforms (DSPs). The highest bidder wins the ad space, and the winning ad is displayed almost instantaneously. This system allows advertisers to target Spotify's logged-in users with greater precision and measure the performance of their ads effectively. Spotify claims that SAX offers full addressability and performance measurement capabilities to advertisers in India for the first time.
In India, Spotify has integrated SAX with leading DSPs, including Google Display & Video 360, Magnite, and The Trade Desk. This integration enables advertisers to access Spotify's suite of audio, video, and display ads through these platforms. The company plans to expand its offerings by soon including podcast ads on the SAX platform.
One of the significant benefits of SAX, according to Spotify, is its ability to maximize unique reach and reduce ad repetition, thereby minimizing the risk of brand fatigue among listeners. An internal analysis of over 350 ad campaigns run across various publishers within Google DV 360 reportedly showed that using SAX led to an average incremental reach of 11.5% without increasing media spending.
Alongside SAX, Spotify is introducing Generative AI Ads within its Ads Manager platform. This tool allows advertisers to generate ad scripts and voiceovers using AI, enabling them to create AI-powered voice ads at no additional cost. Advertisers of all sizes in India can leverage this AI tool to create and deploy scalable audio ads on Spotify. The AI-powered feature significantly reduces ad creation time, potentially cutting it down from days to minutes. Advertisers can also use scripts, voiceovers, and even licensed background music to enhance their ads.
Arjun Kolady, Head of Sales - India at Spotify, emphasized that the goal is to make it easier for clients and agency partners to include Spotify in their programmatic strategies. He noted that over 5,000 advertisers had tested SAX globally and that the introduction of Generative AI Ads would expedite the process for brands to reach their consumers, making the ads more topical and relevant.
The launch of SAX and Generative AI Ads in India is a strategic move by Spotify, as India is one of its top five markets by user base. These new offerings are expected to streamline ad creation, improve ad reach, and reduce costs for advertisers in the region. By providing real-time access to its engaged user base and simplifying the ad creation process with AI, Spotify aims to solidify its position as a key player in India's digital advertising landscape.
