The addition of “Promoted Stations” allows brands to promote their own stations on the popular streaming music service. Diageo plc (ADR) (NYSE:DEO) (LON:DGE)’s Crown Royal, Skechers USA Inc (NYSE:SKX), Sonos, and Taco Bell are just a few names among the ten brands that have been selected to be included in the beta test that will see 10% of its 75 million users exposed to the experiment.

Pandora

“This is the first time we will be testing an ad product within the station list,” Pandora Media Inc (NYSE:P)’s VP-digital Lizzie Widhelm.

The “Promoted Stations” ads will be offered at the top of the “Stations You Might Like” section of station lists. It’s not terrifically dissimilar to a branded YouTube channel.

Pandora: The importance of advertising

With roughly 80% of its revenues coming from advertising the experiment is important to Pandora Media Inc (NYSE:P) as content acquisition costs continue to rise. The company’s first quarter saw advertising revenue rise by 45% to 140.6 million. Targeted ads cost more money and Pandora has yet to decide whether it will charge per impression or per action.

At the same time that a number of Pandora Media Inc (NYSE:P) users were being exposed to the “Promoted Stations,” the company revealed its user metrics for April.

Pandora’s listening hours for April rose 30% compared to April last year. The company also saw a rise in active users at the end of April to 76 million, up 8%.

This is the penultimate month for Pandora’s metric reporting with June set to be last announcement for May’s numbers. The company believes that third parties are plenty well-equipped to provide advertisers with the data and tools they need to compare music streaming sites.

Pandora now claims 9.28% of U.S radio listening up from 7.33% during the year ago period. That is up from 9.11% in March and 8.91% in February.

Why the selloff?

Despite these solid metrics, Pandora experienced a sell off today that has the stock trading at $22.52 at 4PM EDT. This is down $2.24 per share or a decline of 8.94%. TheStreet’s rating team has Pandora Media Inc (NYSE:P) as a “sell” with a grade of “D”

TheStreet said the following, “We rate Pandora Media Inc (NYSE:P) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been generally deteriorating net income.”