Despite a global pandemic, 2020 was a monumental year for podcasts. Monthly podcast listeners grew by 16% with over 100 million monthly listeners in the US alone. With more people listening to podcasts, there’s also been more podcast creation and investment across the industry. Big companies like Spotify are doubling-down on the podcast business through different acquisitions and high-profile licensing deals. This recent industry spike has brands interested— this year, podcast advertising spend is projected to surpass $1 billion. As this medium continues to grow in popularity and scale, it is important to recognize the value that podcasts can bring to marketers and advertisers.
When it comes to marketing, the main focus is content. “Content is king”— a commonly used phrase across the industry that still holds true. With podcast consumption steadily rising, this medium has become a powerful content marketing tool. Brands can use podcasts to put out high-quality, relevant content without a written blog post or article. Unlike written or visual content, podcasts allow the audience more room for multitasking. Being the only form of content that doesn’t require a visual investment, podcasts give listeners the flexibility to engage with content in a convenient and more meaningful way.
Much like social media, podcasting can help establish a brand’s identity and build a stronger relationship with its target audience. At its core, podcasting is about telling stories and providing listeners with something valuable or entertaining. With podcasting, the format makes it easy to provoke thought and encourage involvement from listeners, helping to build that consumer-brand bond. Once this bond is well-established, it becomes easier to create brand affinity that can be expanded across other marketing channels.
The “opt-in” nature of podcasts helps foster a culture of anticipation for listeners, which leads to strong receptiveness. Podcasts that earn loyal followings are able to position themselves as authorities or thought leaders within their niche. Developing informative, value-driven content is a strategy commonly found among podcasts with enviable reputations and influence. Becoming a thought leader in this space can help a brand stay top-of-mind and be a go-to source for relevant information pertaining to a specific niche.
Creating an original podcast may not be the best fit for every brand. However, advertising on existing podcasts is another great way to take advantage of this medium. Not only is the podcast audience large and growing, it is also attractive to advertisers. Many podcast listeners tend to be young, affluent, educated, and generally more open to advertisements in podcasts compared to other mediums. This is especially valuable for brands trying to reach younger audiences that are increasingly resistant to typical forms of advertising. In fact, many listeners actually approve of podcast sponsorships and even find ads to be memorable or impactful. This is primarily because listeners make a connection that the advertising plays a part in funding the content they enjoy listening to.
Traditionally, it’s been somewhat difficult to measure the return on investment in podcast advertising. Up until recently, almost all podcast ads were static— meaning that once a podcast is recorded and published, it exists in the same form forever. Podcast hosts typically would read ads during the episode or in a pre-recorded segment, and many still do this. Fortunately, streaming has opened the door for many advancements in data-driven podcast advertising helping the industry boom. For the first time, advertisers can track attribution, measure lift, and retarget users to maximize campaign impact.
This past year, Spotify introduced its “Streaming Ad Insertion” tool. The SAI tool dynamically inserts ads into podcast streams, allowing for more targeting and measurement for advertisers. Initially, SAI only was available to Spotify original or exclusive podcasts, but now it’s opening up to all podcasts through the recent acquisition of ad tech company Megaphone. With Megaphone’s technology, Spotify’s SAI tool will be available to all podcast publishers and advertisers seeking targeted ad slots. This gives advertisers more scale and control when it comes to who they can reach, all while enabling publishers to make more money from their shows.
The expansion of these types of tools gives publishers, both big and small, greater opportunities to monetize their podcasts. Investment in data-driven tools and the shift from un-trackable baked-in ads to dynamically inserted ads is paving the way for more programmatic ad buys. Meanwhile, more and more brands are moving into this space to compliment their overall content strategies, helping solidify this medium as the new norm. In such ways, this widespread proliferation will help stimulate the overall growth of the podcasting industry. And with podcast listening becoming a bigger part of people’s daily lives, it’s safe to say that the audio-only format has made a massive comeback decades after “Video Killed The Radio Star.”
The marketing and advertising industry is constantly evolving and can be difficult to keep up with— and that can get overwhelming.
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