Does Podcast Advertising Work?
Why, Where, and How to Advertise on Podcasts
Joe Rogan’s recent blockbuster deal with Spotify has the potential to make marketers everywhere fully realize the incredible advertising power of podcasts. He signed a deal to have his wildly popular The Joe Rogan Experience exclusively stream on Spotify this coming September 2020. The deal is worth more than $100 million, one of the largest deals ever for a single podcast. And yet, this is just Spotify’s latest splash into the podcast world.
What does this mean for advertising? High-level: podcasts are a viable and fruitful advertising platform to reach relevant audiences. Let’s dig deeper into why, where, and how advertising works well on podcasts.
Why Podcast Advertising Works
The volume of listeners.
Perhaps the biggest proponent of advertising on podcasts is the staggering number of listeners. Research shows that 165 million Americans have listened to a podcast, equating to 51% of the US population. Furthermore, nearly 103 million Americans listen to podcasts weekly. A deeper dive into who these listeners are reveals a real opportunity for advertisers to tap into a devout and diverse group, with an average income above the rest of the country.
Podcast listener fast facts:
45% of monthly podcast listeners have an annual household income over $75,000, verses only 35% for the total population
Podcast listeners listen to an average of 7 different shows per week
Listener age groups: 18 – 24: 18% | 25- 34: 28% | 35-44: 21% | 45-54: 16% | 55-64: 11% | 65+: 6%
The average weekly podcast listener spends about 6 hours and 37 minutes per week listening to podcasts.
They also spend less time watching cable TV, preferring to stream online video platforms like Netflix and Amazon instead. This gives advertisers a chance to go after an audience that otherwise may not see their ads on cable or broadcast television.
Marketers are continuing to see the power in podcasts with advertising spend expected to grow 31.1% in 2022 and to reach $2 billion in 2023.
I pick, therefore I listen.
Podcast listeners generally must actively seek out the shows they want to listen to, signifying that they are far more likely to be more engaged with the content. In fact, 80% of listeners listen to almost the entire podcast, making it one of the best engagement rates across any medium.
In addition, a study of 1,400 monthly adult podcast listeners showed that only 20% say they actively skip, block or tune out podcast ads. This means that podcast listeners skip or avoid ads less than other advertising channels like online pop-ups (44%), email (33%) and TV (23%).
Combine all this with the fact that many podcast ads are personally read by the host who natively insert the brands into their show, and it’s no surprise that a whopping 67% of podcasts listeners could name an actual product feature or specific promotion mentioned in the show.
All of this leads to the most impressive number of them all: According to the IAB Podcast Playbook, 61% of podcast listeners said they bought a product or service that they learned about from a podcast. This puts podcasts on par with Facebook video content that reports 64% of consumers make a purchase after watching a marketing video.
Where Podcast Advertising Works
Know your audience.
With literally a million different podcasts out there, it’s important to leverage the podcasts who already engage with your target audience. Joe Rogan has a massive reach but his numbers skew male, 17-32 years old. If your target demo is grandmas 65 and older, Rogan is a no go.
There’s more than one way to deliver your message.
Native ads, read by the podcast host(s) live during the show, are an effective option for advertising ads. Having the host(s) deliver your message within their actual show leads to a more receptive audience that are actively engaging with what the trusted host is saying. But these baked-in ads are not the only option you have.
You can also advertise directly with the platform streaming the podcast, such as Spotify or even YouTube. Although advertising through the platform, rather than the actual podcast, doesn’t give your brand’s message the benefit of naturally fitting into the show. Instead, the show will come to a break while your ad plays.
The benefit to these dynamically inserted ads is that that they can be inserted quickly, on-demand at a cheaper cost than native ads. They also allow for more precise targeting and detailed tracking. Plus you’ll have more creative control which will allow for more consistent messaging.
One very important thing to remember is that dynamically inserted ads can still be delivered by the show’s host with pre-recorded ads. How you choose to deliver your message will depend on your budget, desire for creative control, and ad availability.
Podcasters are also Instagrammers.
People who listen to podcasts are much more engaged and active on social media. Keep this in mind as you decide where your advertising dollars should be spent. Paid social media retargeting campaigns are a great opportunity to solidify your brand message to your target audience. A listener who just heard about your brand on their favorite podcast may be more inclined to follow your social media pages and engage with your sponsored posts.
How Podcast Advertising Works
Most podcasts have three slots for ads
1. Pre-roll – $$ – Usually the first thing a listener will hear when they listen to an episode. Typically, 15-30 seconds. With pre-roll ads, the audience will be listening though possibly not as actively engaged since the podcast hasn’t started yet. These ads are generally cheaper than mid-roll ads.
2. Mid-roll – $$$ – The most favorable slot that lasts about 60-90 seconds and plays halfway through the episode. Mid-roll ads grab the listener when they are most engaged. The longer ad time is great for business first introducing their new product or service. But it all comes with a price, as mid-roll tends to be the most expensive slot of the three
3. Post-roll – $ – Plays just before the closing credits and usually runs for 20-30 seconds. Post-rolls are widely considered the least effective slot. Primarily because the podcast has ended, and listeners are done engaging with the content. However, your message could still be heard for a favorable price.
How to Make Podcast Advertising Work For You
Measure your ROI.
Measure how your ads are performing with the three best practices to keep track of your success:
Promo Code – Share a specific word or phrase on your ad for listeners to enter when they purchase your product online. This will let you know which show generated the sale.
Vanity URLs – Use a custom website link unique to the show that will lead listeners to a dedicated web page. This will allow you to count how many visitors the show produced.
Checkout Surveys – After a user purchases your product, include a quick survey that asks them how they heard about you.
All three practices offer their own set of pros and cons. Wingman’s Managing Director, Scott Berger, explains: “Promo codes and vanity URLs are great because they offer empirical data that lets you see just how many customers a podcast has attracted…having the show host actually read the promo code and vanity URL helps brands take advantage of their social equity; the host is well-known and trusted, making listeners more likely to follow through.”
When it specifically comes to promo codes, Berger advises to be thoughtful with your approach. “We’ve seen instances where after a few days, a client’s promo discount code will appear on sites like retailmenot.com, making it harder to track because customers may have received the code from a site instead of the podcast.”
As for checkout surveys, Scott likes that it’s not a code or website address that your listener has to remember but cautions that people will occasionally give the wrong answer due to the fact they either genuinely forgot or were embarrassed to acknowledge the ad successfully persuaded them. “We’ve seen people tell us they heard about a client’s product from a certain TV channel that we weren’t even airing on.”
Test over time.
Advertising a single ad on one episode won’t give you a big enough sample size to see if it’s effective. Consider advertising on seven to nine consecutive episodes to reinforce your brand messaging and CTA. After your campaign has ended, take a look and review your performance.
Sold on Podcast Advertising? Let’s Talk
When you’re ready to see how podcast advertising could work for your brand, chat with us. Wingman has extensive experience with digital media— including audio streaming– and know how to find the right audience and podcast for your brand.
Our haloAMP™ Audience Management Platform allows us to precisely target your most valuable digital audiences across Social Media, Programmatic Video and Display, Audio Streaming, and OTT devices like Connected TV – for the kind of reach your brand really needs.
We’ll work with you to strategize and execute a podcast advertising campaign that makes sense for your brand, reaches your target audience, maximizes your budget and, most importantly, gets results.