How Can Advertisers Navigate The Recent Changes In The Podcast Landscape?
Over the last few years, podcasts have become a popular alternative to build an audience, being a decentralized medium—the technology on which podcasts run (RSS) is not corporate owned, unlike Twitter or YouTube. As I write this, the Apple Podcasts directory alone carries over 2 million podcasts. And that's not an exhaustive list, with a number of podcasts outside the directory. The Podcast Index for example, reports nearly 4 million podcasts, but that’s for another day.
Earlier this year, both Apple and Spotify announced that podcasters could charge subscriptions directly from listeners on their platforms.
The membership model itself isn’t new at all. Independent podcasters have offered it for years, while publications have been exploring the model in various ways over the years. In our part of the world for example, Arabian Business and Gulf News now charge their readers directly for the work they publish. There are obvious advantages to building a direct and monetary relationship in a medium like podcasts that has traditionally run on anonymous downloads. Subscriptions open up an opportunity to connect with listeners through perks such as ad-free, bonus or exclusive content and building out an online community.
The offer of ad-free episodes however, is a member perk that might have unintended consequences. Membership programs have often offered up a 'premium' feed, and Apple’s own suggestion is to offer ad-free content as a commitment to members. Let’s think about what that actually means though: an advertiser’s message does not reach the loyal (and paying) bracket of a podcaster's audience!
This is one of the dilemmas I've been pondering over the last few weeks as we've been working on our own community offering and exploring Apple's offering within it (Spotify's is US-only for now). Why are we encouraging creators to treat content with ads as less-than-premium, especially when as podcasters, we try so hard to get products we love to work with us, and craft engaging audio messages that we hope resonates with our listeners? What's worse, we're now starting out with the assumption that advertising is a net-worse experience rather than a potentially better one.
In fact, podcast advertising has traditionally been native, host-read, privacy-friendly, and for products and services that the podcasters themselves use or are happy to support. Listeners are far less likely to find a podcast-heard ad suddenly littered all over the websites they visit to the point of annoyance. This is the reason why podcast advertising consistently outperforms traditional media.
A 2019 study by StoryWorks, the BBC’s branded content division, found that individuals who identified as ad-avoiders were 22% more likely to remember brands in podcasts compared to TV, have 14% higher purchase intent, and 89% higher brand awareness due to a brand mention on podcasts. Our 2020 State of the Industry report found that 66% of local listeners don’t skip ads on podcasts. Podcasts have a long tail, and episodes are often heard a year or two later sometimes, especially when the content is evergreen.
So the onus is on us in the industry—both podcasters and advertisers—to work closely to build ads and campaigns that are relevant to our audience, and help build genuine interest for our partners’ products and services and create those great fits.
The other thing to consider is how we could leverage the branded content opportunity with podcasts beyond just sponsorships—ie, a show that carries the brand title as part of the show. Again from our 2020 Report, 92% said they'd listen to a branded show. This is because podcasts natively tend to provide more long-form, in-depth content which can provide value in some form, whether education or entertainment. There are numerous examples to learn from both internationally and locally as well, such as Volkswagen Middle East's campaign, The Journey, which we worked on last year.
Communicate Staff
The podcast advertising market is estimated to touch US$2 billion in the US alone by 2023, according to a study by the Interative Advertising Bureau. While subscriptions are a valuable opportunity for creators, there is no reason for advertisers to sit out. I'd even go as far as suggesting that advertisers should ask if it is possible to be included or mentioned in members-only feeds. And why not explore partnerships with podcasters who have built sustaining memberships, whether its through seminars, events or other collaborations. They're the podcaster's most loyal audience and will value the message if created right.
Advertising doesn't need to, and shouldn’t, be disruptive. They can provide a natural break in an intense documentary, or give listeners that breather when they’re doubled up in laughter. And while they’re at it, they get to learn about your product or service that might actually be useful to them. Let’s build that together.
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