Traditional radio might have been relegated to the annals of history, but voices are finding a new outlet due to the advent of streaming services and the rapidly growing podcast market.
The podcast market has seen a dramatic rise over the last decade, achieving significant growth over the course of the pandemic. In 2006, polls showed only 22% of the US adult population were aware of podcasting.
In 2021, the percentage had surged to 78%, equating to an estimated 120 million podcast listeners in the present-day United States. A diverse and open market, podcasters come from all walks of life, covering a whole host of topics. Anyone can start a podcast and this form of creative freedom has found a highly engaged following in its listeners. A level of engagement that makes podcast advertising an intriguing prospect for brands looking for new marketing opportunities.
How is the podcast market changing?
Podcast listeners are diverse and cover a wide range of demographics. As of 2020, there has been a rapid growth in millennial ethnic group listeners with 16% and 11% of US audiences being Hispanic and Black respectively. Minority listeners make up an even larger share of the audience internationally.
North America and Asia make up the largest markets with South Korea being prominent with 58% of adults in the country stating they listen to podcasts every month. In the UK, podcast listening is on the rise with 18% of adults in the UK reporting that they listen to podcasts on a weekly basis.
Whilst podcast audiences cover a wide range of age demographics, the fastest growing age group is 13-18 showing a trend that podcasts will become increasingly influential in the coming years by integrating themselves into the day-to-day lives of young listeners.
Why is it worth advertising via podcasts?
In 2018, iHeartMedia, one of the largest multimedia groups in North America filed for bankruptcy. It emerged the following year with revenue of over 3.68 billion US dollars largely thanks to its extremely successful podcasting subsidiary iHeartRadio.
An example of a successful iHeartRadio show would be Stuff You Should Know (or SYSK), a popular award-winning podcast that educates their listeners on a diverse selection of topics – presenting knowledge in a fun and engaging way. The podcast’s success means that it’s regularly ranked in iTunes top 10 most popular podcasts and is downloaded millions of times each month.
SYSK, like many other successful podcasts, is funded primarily by ad revenue. In other media outlets, such as television or social media, ad-avoidance hinders the effectiveness of marketing through those channels. This however isn’t the case with podcasts. Statistics show that 78% of podcast listeners approve of podcast sponsorships and ads. Why is this the case, when usually direct advertising methods have to overcome initial negative consumer reactions in their efforts to make a connection?
The answer lies in just that – connection. Podcast listeners don’t simply approve of adverts but often report finding them memorable and motivating. They appreciate that advertising funds the content they value and so are more inclined to pay attention. They also feel a heightened level of trust in their show hosts to market to them products that they consider of high value. According to a recent survey conducted by the Interactive Advertising Bureau, a notable 67% of listeners demonstrated the ability to recall products and brands advertised on podcasts, while an impressive 61% made purchases based on products or services they discovered through podcasts.
Each week, more Americans listen to podcasts than own Netflix accounts. In 2020, the multinational firm PricewaterhouseCoopers estimated podcast advertising expenditure at $800 million. Their forecast suggests that the market will grow exponentially, more than doubling by the year 2024.
What brands have had success through podcast advertising?
Companies that have achieved particularly successful results via podcast marketing have been online e-commerce, subscription based or tech-based businesses. Businesses that push products that make your day-to-day life easier; think Canva, HelloFresh or Sonos.
Canva
Since its establishment in 2012, the Australian online publishing tool Canva has experienced rapid expansion, accumulating a user base of over 15 million individuals across 190 countries. They have tailored themselves to users working in SEO, social media, content marketing and online entertainment as a quick, easy-to-use design tool. One that is more accessible to first time designers than more in-depth tools such as the Adobe Creative Suite whilst also being available on the go (provided you have access to the internet).
On location and need a quick image mocked up for a social post or to assist a client? You can access Canva on your phone, use a complex range of in-built creative assets and have something downloaded and ready to use within minutes.
HelloFresh
HelloFresh is now a household name. Delivering fresh products to your door for agreed upon recipes, they’ve simplified home cooking and eating healthy for adults with a fast-paced lifestyle who might have settled for one too many takeaways or fast-food meals in the past. A 2021 study found that Hello Fresh are the most recalled brand that advertises via podcasting.
Sonos
Sonos offers wireless speakers that provide high quality audio streaming. They made the decision to focus their advertising through a relevant podcast. They partnered with Dissect, a show that analyses one song per album per episode. It is respected by its growing and dedicated fanbase for its deep dives into the world of contemporary music, the host’s level of knowledge and their insights on the subject matter. It was a match made in heaven that helped Sonos transfer some of the respectability and reputation of the show in the eyes of listeners over to their own brand.
Many other larger companies have gone the extra mile and even developed their own podcasts from scratch. McDonalds created, ‘The Sauce’ an investigative show that delved into the public relations problem that a particular episode of the TV show Rick & Morty created for their brand and how they went about tackling it.Microsoft’s ‘.future’ explores how the future may unfold based on our lives today and the choices we’re making as individuals and as a society.
What other benefits are there to sponsoring a podcast?
- Podcast listeners are more likely to follow companies and brands on social media
- Podcast listeners are more likely to subscribe to Netflix or Amazon Prime (meaning they are less likely to be exposed to TV advertising)
- Podcast listeners are more likely to own a smart speaker (Amazon Alexa or Google Home) and focus the majority of their spending via e-commerce websites.
- Podcast listeners are more likely to engage with an advert and use marketing tools like promo codes, etc, to place their initial orders with a brand. They are also more likely to complete customer experience surveys on checkout if offered the opportunity to namecheck the podcast that sent them to the website.
In a world dominated by social media, streaming giants and future tech talk applications like the metaverse, it’s easy to overlook something as quaint as the modern take on radio. To leave you with an important takeaway, podcast ads are the most recalled type of ad – with 86% of respondents saying they remember hearing an ad, 72% recalling a brand ad read out directly by a host and ads within the body of a podcast produce an average of 50% increase in purchase and recommendation intent among listeners. These are obviously desirable numbers. So, when pondering how to develop your next marketing campaign, perhaps close your eyes and listen out for your next big opportunity.