Audio as an entertainment choice for audiences, and a media channel for advertisers, has gone from niche to mainstream in a matter of years. This has been driven significantly by the increase and popularity of podcasts and due to the number of people that are now listening in the US, it’s not hard to see why.
According to Insider Intelligence, in 2021 the number of monthly US podcast listeners is expected to increase by 10.1% YoY to a massive 117.8 million. Further, podcasting as a channel is only going to grow as an opportunity for brands to reach audiences. By the end of 2025, it’s projected that there will be over 144 million monthly podcast listeners in the USA.
The pandemic drove podcast growth, with many listeners turning to audio to stay ahead of the news. Now the podcast listening habit seems to have stuck, with over 90% of weekly podcast listeners saying they spend about the same or more time listening to podcasts.in 2021. The growth of audio has been further fueled by many people working from home, and the increased access to at-home smart speakers. By end of 2021, Smart Speakers are expected to see a 21% growth globally. For advertisers, there is now a whole new channel to explore, with the development of programmatic audio helping many brands move into the audio space when previously they would have stayed away.
Given the growth of the podcast industry, ad spend is swiftly catching up, with US podcast ad spend predicted to rise by 38.7% YoY in 2021. In just two years US podcast ad spending will have nearly doubled, from $701m in 2019 to $1.33 billion in 2021. With audio being included in more and more media plans, it’s presenting an exciting opportunity for brands to reach audiences they are literally tuned into. Here are some considerations as to why audio can be a useful channel.
Audiences
Podcast listeners in the USA have an even gender split of 52% male and 48% female. Listeners tend to skew affluent, with 42% high income. In addition, 37% have a university degree, and 57% work full time, and significantly, 56% say they are not bothered by audio ads (Source: GWI). American podcast listeners tune into an average of 8 podcasts per week, averaging 5.1 different shows per week. However, competition is fierce, as of February 2021 there are over 1,750,000 podcasts and 43 million episodes available to choose from. This is where the growth of programmatic in this space will help brands reach their audience through specific shows that previously they might not have considered previously. Currently, mid-roll ads account for 76% of revenue, and announcer-read ads increasing from 27% to 35% in 2020.
Behaviour
Like all media channels understanding your target audience and their behavior/habits before matching this to the media, usage is essential. For example, 59% of podcast listeners tune in while doing their daily chores, 52% listen while driving, 51% while cooking and 44% while exercising. Picking genres that your audiences are interested in and the time of day they are likely to listen to requires careful planning.
According to Neilsen in their Podcasting Today report, the news is a preferred genre on weekdays between 6-10 am and 3-7 pm, whereas comedy is preferred in the middle of the day mid-week. Women prefer content centered on family, children, health/fitness, true crime, and education whereas men prefer sports, technology, and politics. Direct-to-Consumer brands make up the bulk of advertiser market share at 19%, Pharmaceuticals have doubled their share YoY by 9%, showing that bigger brands are moving into the space.
Measurement
Even with the growth of audio, there are still common questions from brands, particularly concerning measuring campaign results and the metrics used to determine the impact of ads.
For example; which data can be obtained from the current technology regarding the audience of digital audio? Or; how can we know the impact of a specific advertising action in the business? Though still being asked are starting to have answers available. Let’s dig into some of these.
Tracking
Digital audio content can be accessed in two different ways: the web browser or an application installed on the device (computer, smartphone, tablet, etc.). In both cases, user behavior can be tracked using platform-specific systems; third-party tracking codes, which send signals when predefined targets are reached; or by analyzing the session information stored in the cookies.
The measurement tools used will differ depending on the type of data one wishes to obtain. For example, podcast producers will be interested in knowing their listeners’ demographic profile, location, and listening patterns, while an advertiser will focus on counting the number of reproductions of their spot and determining the effects it has had on their target.
Google provides a specific analytical tool for podcast creators (Podcast Manager), which enables the minute-by-minute study of listener behavior. This establishes average listening time and monitors how engagement evolves. Spotify provides brands with insights on impressions (plays) ads are getting, along with reach and frequency of listening metrics, and additional
Benchmarking
The IAB suggests a series of digital audio metrics to quantify reach and effectiveness. The most basic would be those related to ad playback and would be used to determine the number of times the ad has been heard as well as the Listen Through Rate (LTR), meaning, the number of times the advertisement was played until the end.
In addition, it is also possible to evaluate the user’s response after exposure to the campaign. When advertisements are launched with a visible banner on screen, the traditional digital analytics options become available, in other words, to track the number of impressions, clicks, and the Click Through Rate (CTR), as well as analyzing subsequent web browsing behavior or lead generation.
Ultimately, the results of digital audio can be calculated by implementing post-listen surveys to measure brand recall and purchase intent.
What’s next for audio
The big players in this space such as iHeartMedia, SiriusXM, and Spotify are focused on growing their creator bases. This may suggest that supply isn’t keeping up with advertiser demand and that they might have to make more expensive exclusive content acquisitions. These digital audio players will face three big content challenges:
- Live audio – how to make this medium compelling?
- Scaling Partnerships – for example, sports partnerships are a big opportunity to drive scale.
- Premium content subscriptions – will listeners pay more for premium content?
In summary
Since This American Life created Serial in 2014 the podcasting landscape in the USA has transformed. Podcasts are a useful addition to media plans because they offer brands the opportunity to get into the world of the listener in a one-on-one, intimate fashion. As an advertiser, you have the ear of the consumer at your fingertips. However, herein lies the issue, getting the message delivery correct and tailored to that individual is important to gain cut-through. With the millions of podcasts available for brands to choose from, the options can be overwhelming, so strategic media planning is important, and measurement is key.
Josh Brooks was recently a guest on the Remerge Apptivate podcast where he spoke about, you guessed it, podcasts!
