What You Need to Know About Podcast Advertising in 2021
In just a few years, podcast advertising has grown into one of the strongest mediums that advertisers are tapping into to reach the audiences who are most receptive to hearing from them.
As podcasting gradually came of age over the last decade and a half, many brands were initially hesitant to capitalize on the burgeoning medium. However, between the boom of big-budget podcast premieres and acquisitions over the last year, along with forecasts that the industry will soon surpass the $1 billion ad revenue mark, it’s clear that faith in podcasts and their advertising has skyrocketed and shows no signs of plummeting.
Even with these figures, you may be astonished to learn that radio is still the most pervasive audio platform, reaching 91% of Americans per week. However, of the one in three Americans who press play on a podcast every month, a far higher percentage of them are likely to take action based on an ad they heard during a podcast episode than over the radio.
Add to this the rise in podcast hosts shapeshifting into full-fledged celebrities (or vice versa), and the mounds of listener data collected by audio streaming services, and it would be hard to deny that podcast advertising is an important piece of the modern marketing puzzle.
If you’re still reluctant about the future of podcast advertising or how to successfully make your entry into this space, then have no fear. We’ll walk you through the wonderful world of podcasts—including who’s listening, and the right ad formats that will help you reach would-be adherents to your brand.
Here’s what you need to know about podcast advertising in 2021.
What is podcast advertising?
Podcast advertising is a form of audio advertising that serves ads to the listeners of a podcast episode. Since podcasts often cover niche subjects and have devoted, attentive audiences, podcast ads are typically more effective and targeted than ads that appear in forms of mass media, such as radio spots or TV commercials.
Demographics of Podcast Listeners in the U.S.
Being efficient with your ad spend always boils down to investing in brand placement targeted at the right demographic. Podcasts present an unprecedented opportunity for advertisers to find their perfect audience because there are podcasts oriented around every niche topic you can think of.
While it’s true that every podcast has its own range of audience demographics, it turns out that podcasts listeners, on the whole, have a few special characteristics.
Here’s what Edison Research revealed about podcast listeners in the past year:
- 37% (or 104 million) of Americans tune into podcasts monthly, and 24% (or 68 million) of Americans listen weekly
- 155 million Americans have listened to a podcast at least once
- Weekly listeners tune in for over six and a half hours each week
- Listenership is almost equally split between men (51%) and women (49%)
- Almost half (48%) of monthly podcast consumers in the US are aged 12-34
The Benefit of Advertising in Podcasts
According to a study conducted by Comscore, podcast ads are considered to be the least intrusive form of digital advertising, while additional research discovered that podcasts ads are incredibly effective.
Podcasts also have the capacity to forge a heightened sense of intimacy between host and listener, and this intimacy generates trust. Approximately 80% of listeners have acted on host-read ads they heard in a podcast, either by researching a product or service, connecting with a brand on social media, discussing a product with a friend, or actually making a purchase. And on NPR’s sponsorship page, they state that 56% of their listeners “prefer to buy products or services from NPR podcast sponsors.”
Listeners are also more receptive when they are listening to podcasts because podcasts command attention in a way that other media doesn’t. Spotify calls it the “sweet spot of attention.” A good chunk of listeners play podcasts in the background while they multitask, yet they still absorb the information. “60% of our audience say they tune into podcasts to educate themselves,” reports Spotify, “and two out of three podcast listeners give them their full attention.”
All About Podcast Advertising Formats and Styles
Although both mediums are audio-based, podcast advertising is not the same as radio advertising. For instance, podcast ads generally tend to steer away from the booming, announcer-style deliveries of traditional broadcasting.
“Forty-five percent of listeners state they wish brands could better speak to what they are doing when they hear ads,” an investigation into listener preferences in the midst of COVID-19 found. “And as routines shift quickly, it’s critical that brands look at contextual cues over less reliable signals.”
Brands looking to connect with their audiences who are primarily streaming audio content from home would be wise to adjust their messaging from what one might normally hear on FM radio. Smart speakers and voice-activated devices also provide the opportunity for brands to reach their audiences by way of interactive voice ads, an exciting new ad format that requires the listener to take an active stance and actually talk back to the ad.
Types of Podcast Ad Insertions
Podcast ads can be inserted through a show in a variety of spots. The three most common podcast advertising placements are:
The ad appears at the very start of the show. Here’s an example:
“This show is brought to you by our sponsor, [insert Sponsor Name + short pitch].”
At the show’s midpoint, there is an intermission where the hosts introduce advertisements and/or the advertisements begin. Here’s an example:
“Hey everyone, we hope you’re enjoying the show. We’d just like to take a moment to thank our sponsors for making this episode possible. [Insert Sponsor Name + short pitch].”
This ad is presented at the close of the show. Here’s an example:
“Support for [insert Show Name] is brought to you by [insert Sponsor Name + pitch].”
Types of Podcast Ad Formats and Scripts
Podcast advertising can be pretty nuanced depending on the style and content of a program, but there are a couple of core formatting strategies that any savvy brand marketer should have a grasp of before they dive headfirst into the podcast advertising space.
Four of the most popular are:
1. Host-Voiced Podcast Ads
Because these ads are delivered via the host themselves, they possess a heightened sense of trust and credibility. This style of podcast advertisement is comparable to an endorsement. Host-voiced podcast ads can be carefully scripted, ad-libbed in the host’s own words, or even presented as an anecdote based on the host’s own experience with the product.
“For brands, these real first-person accounts provide a remarkably effective way to connect with audiences,” writes Spotify. “When listeners hear these hosts evangelizing products, they don’t feel like they’re being marketed to — the effect is more like hearing about a product or service from a trusted friend.”
Host-voiced podcast ads are typically woven throughout the episode at regular intervals. They are also seldom accompanied by music or other sound effects in order to produce a seamless transition for the listener.
2. Fully-Produced/Hybrid Podcast Ads
Fully-produced podcast ads may call attention to themselves by arriving accompanied by music or other audio cues. They also typically feature a new voice other than the host. This new voice either belongs to a member of the podcast’s production team, the sponsor company, or an audio ad voice actor.
The most effective way to introduce a fully-produced ad is by getting the host to prepare the listener for what they are about to hear. This style of ad should be introduced in a manner that mirrors the production style and overall vibe of the show that it appears in.
Here’s how NPR achieves this using a format they call ‘Brand Soundscape.’ Listen to the host, Guy Raz, as he transitions into the produced ad by Kia. Note how the feeling of the ad’s content is reminiscent of the journalistic/docu-style reporting common to NPR.
Visit NPR’s site to explore a variety of podcast ad examples that they produce.
3. Data-Driven Ad Insertion
The reach of podcast ads was historically measured by the number of times an episode was downloaded via listeners’ RSS feeds. The problem with this metric, however, was that any insights regarding the ad’s success necessarily came to a screeching halt once the podcast episode had been downloaded to a listener’s device. There was no way to gauge whether the podcast ad inspired any action in its audience, let alone any verifiable way to determine whether the listener even pressed play on the episode.
In 2014, the first stride toward targeted podcast advertising was made. A global podcast company by the name of ACAST was the first to offer “customized ads based on the date and the listener’s location.”
Ever since, the dilemma surrounding minimal podcast listener insights has steadily subsided with the shift from episode downloading to streaming, as well as the emergence of Streaming Ad Insertion and other data-driven technologies developed by audio streaming services. Spotify draws on its vast database of information about each individual user in order to strategically insert custom-made, real-time ads into its shows “based on what it knows about its users, like where they’re located, what type of device they use, and their age.” This means that listeners of the same podcast will be served up different ads.
This form of intelligent advertising is bound to usher in a future of hyper-targeted podcast advertising where tailored ads are delivered to every listener in a fashion that is guaranteed to make the highest impression upon them.
Another cutting-edge ad format that learns from its user’s behavior is voice-enabled interactive ads. When a listener is prompted to express their interest or disinterest in an ad’s content, the manner in which they respond can have an impact on the type of ads they receive, or the general approach that brands take to advertise toward them in the future.
4. Branded Podcasts
Advertising on somebody else’s podcasts is only the first step of leveraging the audio space to your brand’s advantage.
Some companies are even opting to move beyond the traditional 15- or 30-second spot by launching their own branded podcasts. This content marketing play is a clever tactic for brands who can pinpoint the optimal topic that intersects what their company offers with what their core customers care about. A branded podcast not only builds trust in your company, but it also allows you to communicate value and position who you are as a company in an intimate way.
Podcast Advertising Rates
Podcast advertising rates vary based on the length of the podcast ad and the size of the podcast’s listenership. However, there are some industry average rates that we can look to in order to gauge how much it will cost to launch a podcast ad.
Podcast advertising rates are generally calculated based on a show’s CPM (cost per mile). Each CPM refers to 1,000 listeners/impressions.
The average rate for a 30-second podcast ad per CPM is roughly $18.
The average rate for a 60-second podcast ad per CPM is roughly $25.
You can refer to AdvertiseCast’s average rate sheet to determine how much your podcast ad will cost in relation to the average number of listeners that a given show draws in. For example, the average rate for a 30-second ad placed in a show that garners over 100,000 listeners is roughly $28.
How to Purchase Podcast Advertising
If you’re interested in disseminating your brand message via the potent medium of podcasting, then you have a few options. You can manually select and contact the shows that you feel would be a good fit. For instance, NPR has a page dedicated to sponsorship information.
Alternatively, you can work with a company that connects advertisers with suitable podcasts. Midroll is one such service provider.
Here are some insights from podcast hosts on the types of sponsorship packages that they offer:
Podcast Sponsorship Offers More Than Traditional Audio Ads
When you start to dig into podcast sponsorship opportunities, you’ll quickly discover that many creators are keen to offer sponsors the best value for their ad dollars.
For instance, becoming a show sponsor can earn you spots not just within the show itself, but also on that show’s supplementary media channels, including their social media, email campaigns, website, and beyond.
Marketing Over Coffee’s John Wall provides an example of how the show is conscientious of offering sponsors the best opportunity for exposure: “We offer quarterly sponsorship packages with the show,” Wall explains. “Vendors can come in and get ten episodes over three months, [but] we limited it to two [sponsors at a time], so there are only two companies per quarter.”
Have You Taken the Podcast Advertising Plunge?
We’re well beyond the era when companies merely had their curiosities piqued by the potential presented by podcast advertising. Especially with the rise of voice-activated devices and evolving routines related to work and audio consumption, it’s safe to say that podcast advertising is one of the most dynamic and intimate ways to speak to your audience.
When you need a voice for your next podcast ad, explore our talent pool of professional advertising and podcast voice actors. Sign up for a Voices account to put out a casting call and find your ad’s pitch-perfect voice with just the click of a button.