Are podcasts the next big ad opportunity for brands?
While it’s easy to think of platforms like Instagram and Facebook as being the prime new media outlets for companies, wellness brands are successfully getting customers’ attention through an advertising outlet that’s been overlooked until recently — podcasts.
Wellness companies such as feminine care brand Lola, oral care brand Quip, vitamin brand Care/of and hair care brand Madison Reed have been finding success advertising on podcasts, according to an article on Glossy. Lola’s co-founder Alex Friedman notes that having the host of a podcast describe the features of a product, how it works and why it’s worth the listener’s consideration is “hugely valuable.”
Advertisements in which a host of a show pauses to explain the benefits of a product to the audience may sound like a throwback to an era when commercials were longer, less frenetic and couldn’t be fast-forwarded through. But the strategy is demonstrating value for wellness brands which, as Glossy reported, benefit from being able to communicate a certain level of personal intimacy. Podcast listeners, for their part, are already an engaged audience because they’ve sought out the podcast and signed up to listen. Listeners may also be more apt to take a podcaster’s word on the quality of a product s/he uses.
Other types of brands have been directing their ad dollars to podcasts, as well. Techworld reports that meal kit brand Blue Apron, website hosting and creation solution Squarespace and mattress brand Casper are all endorsed regularly on popular podcasts. The article speculates that podcasting may be the next big frontier of advertising and cites a 2017 Apple study, which indicated that people listen to 90 percent of their favorite podcast on average and rarely skip advertisements.
According to a study by Edison Research, 24 percent of the U.S. population listened to podcasts on a monthly basis in 2017.
Some retailers and brands, such as Trader Joe’s and Barneys, are looking at podcasting as more than an advertising channel. Both recently launched their own podcasts to tell brand-appropriate stories to their fans and customers.
Discussion Questions
DISCUSSION QUESTIONS: Does podcast advertising have the ability to push conversions more than other media channels, both new and conventional? What brands or types of brands might best benefit from advertising on podcasts?
Poll
BrainTrust
Phil Masiello
Founder and CEO, CrunchGrowth Revenue Acceleration Agency
Kiri Masters
Founder and CEO, Bobsled Marketing
There is value in this, especially when it comes to educating and informing consumers about products in an engaging way. However, content needs to be top-notch to cut through. There are so many podcasts these days and not enough time to listen to them all.
In a way, these are really no better or worse than vloggers who promote stuff on their YouTube channel, it’s just a different medium. Sure, advertising can work if you target it right – anywhere. What would be more interesting to me would be retailers who invest in podcast content, rather than yet another ad.
Podcasts have become a type of on-demand radio. The key is to keep your audience engaged and have a clear strategy to keep the podcast interesting.
There are two different podcasting approaches you are discussing here. First, there are the brands creating their own podcast and second, brands advertising on podcasts.
Brands like Barneys and Trader Joe’s creating a podcast need to think long and hard about what they are trying to achieve. If these podcasts turn into 30- to 60-minute advertisements, they will have a difficult time retaining an audience.
Advertising on existing podcasts can be effective endorsement opportunities for brands, but it comes down to the spot costs. And spot costs needs to relate to the number of active listeners. Many podcasts jumped the gun with their advertising rates. Although many brands began advertising on podcasts, they did not stick with it for a long time because the returns were not there.
For brands to get the required return, they need to find the correct podcast for their audience, pay the right price and have the right message for the expense to be effective.
As a podcaster myself I may be biased, but I definitely believe podcasts are the next great frontier for brand marketing. As mentioned in the article, people subscribe to their favorites podcasts and they rarely skip episodes. Of course when they subscribe, they create hyper-targeted lists of like-minded listeners — the kind of data that is gold to savvy marketers, even if the audience/reach is smaller than other mediums. The key to successful podcast advertising is striking the right tone and preserving authenticity. In general, brands don’t have the greatest track record in either of these categories, so they must proceed thoughtfully and resist the urge to simply drop ads that have been created for other mediums into the podcasting ecosystem.
Well said, Dave. Not every form of outreach is an opportunity for ads. Consumers still get largely turned off by ads unless they are well placed, well said and applicable.
Another podcaster here! It’s my most beloved content medium and I agree that dedicated fans never skip an episode.
But as others have said, this is a medium that brands and retailers need to curate very closely in order to find their tribe. A scattergun media strategy would not work here.
As for podcast series that brands produce themselves, they can work quite well, provided the brand doesn’t feel compelled to make it an hour-long advertorial for their product or service. My podcast, for example (Ecommerce Brain Trust for those playing at home) is a marketing channel for my agency, Bobsled Marketing. We very rarely mention the agency at all. And other brands, Slack for example, produce very engaging shows that don’t “push” the brand — simply serving their audience of knowledge workers and building goodwill amongst this group.
Three cheers for podcasts. I’m truly glad that they are attracting advertising dollars from brands.
Just as retailers are driving curated assortments and experiences, the same principles should apply to podcasts. There are simply too many out there in the market. Yet with the right mix, storytelling via podcasts has its place for luxury, lifestyle, fashion and the beauty segments.
Podcasts may not have such a significant impact on conversions and other KPIs as compared to an in-person interaction with a knowledgeable sales associate. However, the right story and podcast can help to sustain and build a closer connection between the consumer and the brand.
Yes podcast advertising is a smart opportunity for brands who are paying attention to consumer behavior. Many people may be surprised to learn that radio is the most popular media in the U.S. — not digital video, TV, cable, YouTube or Facebook. The important thing when buying any media, including podcasts, is to measure and audit the impressions (audience) you are actually reaching. This will ensure you are not paying too much for buying ad time on a specific channel.
Endorsement-style ads in talk radio have always been incredibly successful for the right product/brand mix. Now that radio has returned to fresh success through digital distribution, there’s little difference between radio and podcast except audience.
And because each media opportunity needs to be considered not as a magic fix but for its strengths and weaknesses, there are weaknesses. The challenge with podcast advertising is audience size. Many podcasts are quite small in audience whereas radio offers somewhat larger audiences (on average).
Podcasts work best for highly unique smaller brands who are just gaining a foothold. Once a brand reaches higher market penetration, then it will need to shift to broader reach advertising to continue to grow.
Depends on the product or service being advertised, too. For a brand manager trying to launch a mass-market product, yes absolutely the advertising reach has to scale. But for more-specialized products, it may be the better bet to continue to invest in methods like podcasting which have a tighter relationship with well defined niche audiences. Finding the right podcasts, YouTube channels, and bloggers that help create intimacy, exclusivity, and nearly one-to-one conversations for such products is key.
Why buy an ad on a show when you can own the entire show? Creating a show that is compelling for a retailer’s community of customers can create engagement and loyalty. Content marketing is powerful when the content is about the customer and not about the retailer pushing product to the customer. It sounds like a simple idea, although creating a show people want to listen to is not easy. But done well, it can be a powerful addition to the marketing and PR of the retailer.
When you buy an ad, you are buying an audience of a certain size. With your own podcast (or any other content), you must build the audience. And that’s not easy.
This has been a huge problem with video as advertising online. It’s easy to create a video and post it online. It’s exceptionally hard to get it watched.
Same with a podcast. You can create your own podcast online. Getting it watched takes considerable effort over a long period of time.
It’s tough not to take a “shotgun” approach with advertising these days to see what sticks among the myriad channels available today. Podcasts definitely reach specific audiences, however you need to identify whom you wish to target with each podcast, and that will most likely differ with each podcast. Podcasts are simply another channel to reach your customer and they should be used in conjunction with other channels. I believe they definitely have potential to drive sales if targeted properly. That’s the key.
Podcasts have become the modern radio and marketers are just finding their way to a new audio advertising in this medium. Listeners are proving to be more engaged with podcasts than even videos have been so it makes sense to see more advertising take shape here. We should expect to see a varied collection of brands appearing in popular podcasts in the near future.
For brands to get returns they need to find the right content tie in that makes for compelling messaging as part of the advertising. The blog owner will not be genuine when the messaging of the brand doesn’t match with the podcast brand or messaging.
Podcasts are not only popular but “intimate” — many people fall asleep to podcasts every night.
Recently a friend and I discussed how emotional we got when married podcasters we’d been listening to for years announced their divorce! Intimacy with listeners can be valuable, as podcasters can add authenticity and get consumers to trust and try a new brand (as many podcast ads seem to be for younger companies), or could potentially turn listeners off if the podcaster becomes popular and starts hawking every product that pays them.