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(By Dave Hanley) We’ve reached an inflection point in podcasting with its surging popularity and listenership growth that’s now reaching a more diverse and younger audience. And advertisers are taking notice and flocking to the intimate, engaging, and highly captive storytelling medium.
In fact, 62% of the U.S. population over the age of 12, or an estimated 177 million people have listened to a podcast, and 80 million people of the same demographic are now weekly podcast listeners, according to The Infinite Dial, Edison’s 2022 Report. As marketers follow their audiences, podcast ad spending is projected to exceed surpass $2 billion in 2023 and the top ten podcast advertisers spent nearly $300 million combined on the channel last year, according to eMarketer. Moreover, podcast advertising is proving to deliver a strong brand recall punch — with host-read ads driving a brand recall rate of 71%, which translates to high levels of consumer interest and purchase and recommendation intent, according to Nielsen.
The engagement and trust combined with new innovations are creating richer opportunities for podcast advertisers as the medium is becoming more dynamic and measurable than ever before. Beyond audio, creators are experimenting with multimedia formats by streaming their shows on YouTube and incorporating graphics and visuals into their content. Furthermore, new audience innovations, such as transcription technologies for contextual targeting, dynamic content insertion, and programmatic buying are generating new revenue opportunities for podcasters and increasing scale across a larger number of shows.
Tapping into the Magic of Podcast Advertising Beyond the Top Shows Amidst the growing opportunities, podcast advertising is still an emerging and highly fragmented medium with a few large networks and literally thousands of independent creators, which often leads many brands and agencies to gravitate toward the top 1,000 or 2,000 shows. But, when advertisers just focus on the top end of the market with these highly visible, large podcasts, they often miss out on the magic that made podcast advertising compelling in the first place. Sometimes with larger, highly visible podcasts, the ads become less organic, the ad loads are higher, and costs have risen due to advertiser demand — and the unintended consequence is that campaigns can become less effective as listeners start to tune out or hit the skip button.
Today’s podcast ecosystem is vast — with hundreds of thousands of active shows. In fact, more than two thirds of podcast downloads can be attributed to shows outside of the top 2,000. This is where we see an untapped opportunity for advertisers. Brands that partner with small and mid-sized podcasts often receive greater value, a larger share of voice, and they get to engage directly with creators to help craft a powerful message for their intended audience. It’s almost a throwback to the early days of the medium.
As more brands embrace podcast advertising, it’s imperative to consider the inventory quality, targeting, and measurement approaches available across the growing landscape. With that in mind, here are three myths surrounding podcast advertising and how marketers can navigate them to achieve their desired objectives.
Myth 1: All Ads Are Created Equal As a podcast advertiser, you need to know the questions to ask when speaking to sellers, as not all podcast ad products can be compared apples to apples. As a marketer, you may see a 60-second ad placement on a media plan, but this is just part of the story. Podcast ads come in a variety of formats, and you need to know whether you are buying a host-read, producer-read or pre-produced creative and what delivery method will be used. Ads can be dynamically inserted, baked-in or “faked-in” (yes, that’s an actual industry term!) and to make things more complicated, dynamically inserted ads can be run on an episodic basis or across the full catalog of episodes. Campaigns can also be capped by impressions or by flights dates.
A host-read message from a trusted voice typically resonates with listeners as it’s the most authentic and cuts through the noise. A pre-produced spot can be a viable option, especially when buying ad spots programmatically across many shows and for specific geographic, behavioral, and demographic targeting options that may not be readily available using the more traditional host-read format. Typically, the most sought-after ad placement is a baked-in, host-read, mid-roll as this gives advertisers the killer combination to maximize reach and engagement. The bottom line is, to ensure the efficacy of podcast ad spending, marketers should work with trusted advertising partners that place a priority on transparency in pricing, ad placement, and ad inventory quality.
Myth 2: Smaller, Independent Shows are a Risky Investment Given the explosive growth in podcast genres and the fact that content topics vary widely from episode to episode across shows, brand safety is a top consideration for advertisers entering the podcasting realm. However, there’s a misconception that if a show does not have a huge audience, the content is not high quality. In fact, advertisers often find some of the most engaged podcast audiences on shows well outside of the top 2,000, and from a brand safety perspective, there are potential risks across shows of every size and genre.
New AI-based transcription tools with human intervention are now available that offer advertisers increased control over where their ads run, the listeners they reach, as well as brand safety capabilities to isolate specific shows, topics, and placements. These tools are now helping to bring more brands off the sidelines and into the podcast ecosystem by alleviating the brand safety concerns.
Myth 3: Podcast Advertising is Just for Direct Response Advertisers Historically, direct response advertisers have been the mainstay of podcasting advertising and the use of promo codes has long been synonymous with the medium. That said, there’s a misconception that podcast campaigns are just for direct response brands. For many larger brands entering the fray with broader campaign objectives, there are new capabilities that are leveling the playing field between podcasting and other digital media.
For instance, marketers can now target by geographic locations, time of day, listener demographics, and listener behavioral segments. With the availability of attribution capabilities, advertisers can connect the dots on campaign spending with performance outcomes or even customized brand lift studies. The capabilities have not just served to knock down barriers for advertisers, they have also validated what companies like AdvertiseCast have been saying for years: Podcast advertising works!
Podcast advertising is primed for accelerated growth as both a brand awareness and direct response channel with new ad tech tools and insights for driving and measuring brand outcomes. To overcome the myths surrounding inventory quality, brand safety, targeting, and measurement, advertisers should partner with trusted partners that are committed to innovation and transparency to empower advertisers to find the magic and unlock the power of podcasting.
Dave Hanley is Chief Revenue Officer at Libsyn’s AdvertiseCast Marketplace. He is responsible for sales and business development at AdvertiseCast Marketplace, the podcast advertising division of Libsyn. You can contact him at: 920.550.8082