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Inside the maturing podcast advertising market

February 4, 2020 | By Kate Ginsburg, VP Product Marketing & Innovation – Kantar @Kantar

If you open a podcast app, like Castbox, Spotify or Apple Podcasts, the content available is immensely vast. Hundreds of thousands of podcasts in every thinkable category, available with the tap of a finger and a slip of an earbud.

Want to learn something about unconscious patterns that drive human behavior? Try NPR’s Hidden Brain. Can’t get enough true crime stories? Try season one of Serial, which might be credited to starting the whole podcast craze. Perhaps the newest, burgeoning fiction podcast category might be more your speed. Short 20-minute audio experiences tell a story over a handful of episodes. Featuring the voice talent of actors like Rami Malek and Josh Gad and complete with sound effects and music, they create a new kind of digital audio content that hasn’t existed before.

Podcasts have become an easy way for people to learn and relax. And with the ability to listen across devices, and with a multitude of available app choices, you can start a podcast on a phone to make a lengthy work commute go faster. When you get home, pick up where you left off by casting to a Google Home device and make mundane chores like washing loads of dishes seem not so boring. These new listening scenarios have created new opportunities for brands to engage with potential customers in places and times that previously were more difficult to tap into.

Follow the money

Plenty of people are consuming podcast content, but are the ads that go with them resonating with listeners and delivering an impact back to the brand? Kantar conducted an analysis of 12 podcast ad campaigns which were inclusive of automotive, CPG, finance, technology and other brand categories. Findings indicated that ads in podcasts contributed to increased brand awareness at a near identical rate to other channels, including in comparison to traditional radio and display. However, when looking at lower-funnel metrics, like Brand Favorability and Purchase Intent, podcasts emerged with lifts 37% higher than other media channels in aggregate. Results like these suggest that listeners are connecting well with the ads that run within podcasts and this resonance is translating to strong brand growth.

Source: Kantar MarketNorms®

As consumers are spending more time behind personal devices, podcasts aren’t just a shiny new way to spend coveted ad dollars. As discovered in Kantar’s Getting Media Right study in 2019, marketers are recognizing the impact and potential of podcasts, and plan to funnel more of their budgets to podcast advertising in 2020. This intent to increase spend puts the medium just behind planned dollars devoted to online video and social, but ahead of traditional channels like radio and online display.

Source: Kantar Getting Media Right 2019

The IAB reported in 2019 that podcast ad spend was estimated at nearly $679M and with the presence of podcasts on media plans expected to soar in the next year, it could easily surpass more commonly used media channels as a relatively uncluttered way to engage with both niche and broad audiences. 

Fun with formats

A variety of ad types have emerged, from companion banners in-app and dynamically inserted pre-recorded ads to baked-in voice-overs read by the host in the middle of the podcast, and the ever present “this podcast is brought to you by…” opening message. So, there are plenty of opportunities for advertisers to fully leverage the podcast platform and engage listeners from multiple angles.

Increased advertising in podcasts will help define the effectiveness of different podcast ad formats and how they create varied content experience for consumers. However, with the superior ad effectiveness seen so far for podcasts and high brand interest, the medium should be a fast-growing channel with loads of potential for media companies to deliver unique advertising opportunities to in a “quieter” media environment.

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