Since the days when families gathered together around the radio, brands have played a vital role in audio entertainment—a tradition that continues with podcasts. While host-read ads or pre-recorded commercials are common, an increasing amount of brands are creating their own podcasts as well.
US podcast advertising revenues are forecasted to skyrocket to more than $220 million this year, according to the Interactive Advertising Bureau—an impressive 85 percent over the $119 million recorded in 2016. Branded content made its revenue-earning debut in 2016, earning two percent of total podcast advertising revenue. While that doesn’t seem like much compared to 73 percent from direct response ads, branded content still accounted for nearly $2.4 million.
Those branded podcasts tended to focus on the spirit of the product or service, such as entrepreneurship (eBay: Open For Business) or money management (Umqua Bank: Open Account).
The Message is an eight-part science-fiction thriller series by General Electric (GE) about cryptographers who try to decipher a message from an alien. GE’s two shows, The Message and LifeAfter, combined, have had their episodes downloaded over six million times. “That’s a big audience that is saying, ‘I elect to listen to 20 minutes of branded entertainment.’ That’s a huge opportunity for a brand,” Alexa Christon, the head of media innovation at GE told Digiday. “This is one of the most direct ways of reaching a consumer.”
Other shows go deeper into a television program like Investigation Discovery: Detective or the just-added TNT’s Will Podcast.
Approximately 46 million Americans ages 12 and over are now listening to podcasts each month, according to a report by Edison Research and Triton Digital. Thanks to voice assistants like Amazon Echo, listening to podcasts is as easy as requesting it aloud. That’s a massive audience that brands are hoping to reach, and traditional advertising won’t go away anytime soon—but podcasts have a way of speaking to millennials in a way that other mediums do not.
According to podcast advertising platform Midroll Media, the best podcast ads are voiced live by hosts in their own words.
“Because podcasts rely on the intimacy of the medium, and the long-cultivated relationship between hosts and their listeners, the ad impact is significant,” Midroll Media’s chief revenue officer Lex Friedman told AListDaily. “We are especially good at reaching the unreachables—millennials who fast-forward through ads on their DVR, run ad blockers, jab at the radio preset buttons in their cars when an ad comes on. When they listen to podcasts, the host-reads feel like a natural extension of the show, so listeners remain attentive.”
This statement is backed by IAB’s study, which revealed that host-read ads accounted for 60 percent of podcast revenue in 2016, compared to pre-produced ads at 40 percent.
In a study from Westwood One in partnership with Advertiser Perceptions, 21 percent of marketers and agencies surveyed reported advertising in podcasts, up from 15 percent in a similar study conducted 9 months earlier. Not far from IAB’s predictions, Bridge Ratings forecasts $207 million in podcast ad revenue for 2017. One thing is for certain—regardless of the subject matter or method of advertising, brands clearly like the sound of podcast marketing.