July 12, 2023
Soundrise partnered with Sounds Profitable, the leading voice for education, research, and insights in the business of podcasting, to sponsor its latest podcast research study, The Podcast Opportunity. Working with with Signal Hill Insights and Digiday, Sounds Profitable set out to study the current perceptions of podcast advertising.
The sample included over 300 buyers from the medium, and respondents were asked a variety of questions centering on past and current podcast buying perceptions, pros, cons and general thoughts of the medium as an advertising vehicle.
Jay Green, Soundrise SVP, Strategy and Operations, weighs in on the study below, outlining the biggest opportunities for both podcast sellers and buyers.
70% of respondents are currently buying podcasts or planning to buy podcasts within the year, but there are 17% who have not purchased podcasts. This represents a fantastic opportunity for outreach and education. We certainly see this as new RFP's come through. An agency not familiar with the medium may try and shoe-horn it into a model designed for streaming, video or display and can make podcast advertising extremely difficult. We are in a great position to help move that 17% under 10%. It becomes our responsibility to understand the asks and fit podcasting into mix.
The big notable here is that direct brands are 9 points higher to start purchasing podcasts this year. This is a great stat putting together the idea that brands will be dictating more dollars for podcasting in the media mix model (MMM, which leads us into more opportunity. Of those currently buying podcasts, only 45% are allocating more than 20% of their plans to podcasting.
With what podcasting can offer, brand suitability and targeting have actually surpassed engagement and attribution as trusted buying points for the medium. When you compare podcasting to other mediums, it does a lot more to keep ad engagement. We don't have a 5-second skip like YouTube, it's becoming much easier to buy, and it certainly is uncluttered when you compare to streaming audio, video and display allowing our clients to stand apart. Finally, the tools used for measurement are growing and evolving. 59% of buyers agree that the measurement tools in podcasting are robust. Measurement is really no longer a question.
When we break out the buying perceptions by agency and advertiser, it's easy to see that the agency side is more educated than the brands, which speaks to our current education needs. Sellers need to educate the direct brands on how podcast advertising works, and where it fits in their media mix.
That said, 72% of brand respondents agree that podcast advertising is more engaging than other forms of advertising. What that tells us is that client outreach is critical to go along with our agency discussions. As we get the direct brands excited, they will take a large part of our responsibility to get their agencies excited.
It's important to understand the insights from buyers. From one insider, "It's difficult for brands to walk in the footsteps of Athletic Greens, Manscaped, BetterHelp, and other brands that have made their names clear in podcast advertising. There is a limited inventory on shows and there are limited shows that work for particular types of brands and products.” That sentiment signals that buyers are feeling pushed out, but we can show them where they can be. With greater qualitative, we can help them understand why there's a fit.
From another insider, "The biggest thing we're running into right now is its inventory volatility, because of the aggregation of companies, and because of that, when I RFP something, get it back, put together a plan, get the client to approve it, the inventory might not be there anymore.” This is a challenge that the industry is tackling. At Soundrise, our expanded portfolio means that the inventory opportunity is at their disposal. Our team can help them to get creative to meet brand goals.
With brand agencies spending more we are seeing an increase in announcer reads at 58%. However, with 59% of buyers leveraging ad creatives from other platforms (e.g. streaming, AM/FM), there is an opportunity to educate on best practices. The creativity and engagement of podcasting as a medium lends itself to host-reads as a better listener experience, not relying on tired audio creative or even creative that was ripped from their video. While it may seem like "more work" for advertisers to spend time on podcast-only creative, they will see better results if they deliver what works best for the audience.
51% of buyers say that brand awareness is the driving factor to buy podcast ads, and 32% say that brand lift is the most important evaluation criteria. Though DR campaigns remain podcasting's bread and butter, more brands are understanding the value that podcasting can offer for branding campaigns. With branding campaigns, reaching an engaged audience is essential. This is where Soundrise shines -- our portfolio, made up of mission-driven podcast networks like PRX, Radiotopia and the TED Audio Collective, connects with an audience more likely to be educated, affluent and influential. These are the listeners that can move the needle for brands seeking top funnel metrics.
There is a lot to be taken away from this study. Podcasting needs to build out its transparency and sharing of information with brands and agencies. Without that available, it's going to be tougher to maintain growth. The industry needs to know they can properly evaluate our programming to solidify podcasting's role in the MMM. We need to continue to educate buyers and brands about how easy it really is to purchase podcasting, and what measurement options are available. Agencies should not be looking to fit podcasting into their video and display buying methodology. They should be looking to understand how they can use podcasting to compliment what they're already doing and expand their reach.
Interested in more insights? Download the full study or reach out to our team to schedule a presentation.
