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The potential of podcasts for advertisers

Best Practices

More and more people are listening to podcasts to receive information about current events. A study by Statista on behalf of nextMedia.Hamburg shows that every second person has listened to podcasts before. The age range of the users is wide; especially teenagers and (young) adults stream the content or save it offline for later use. Publishers and editors also like to use podcasts to distribute their advertising content. Documentaries, news and talk shows report on entertainment topics, science and education, as well as on politics, economy and technology.

These audio formats show great potential for advertising revenues, particularly in the USA. The results of a study by the International Advertising Bureau (IAB) and PWC illustrate this growth: Within one year, advertising revenues rose from 169 million US dollars to around 314 million US dollars. The range of advertising options is large and ranges from brand awareness ads and branded content to direct response ads. Remarkable here is the growth of the branded content as well as the brand awareness ads.

The number of podcast users in Germany also grows. According to a Splendid Research survey about podcasts, listening to podcasts simultaneously to other activities is particularly popular at home, followed by active and focused listening at home as well. 25 % of the respondents stated that they listen to podcasts on their way to work.

The opportunities of listening to podcasts also show the main advantages. As well as reaching the right target group, the (usually) active and concentrated listening of the users also increases the attention paid to the advertising message. That is because most users don’t skip the advertisement. The content is either entertaining or matches the own interests. In fact, 41 % of the interviewees were interested in the product and in trying it out after listening to the podcast.

How can advertising be integrated in podcasts?

There are three options for advertisers to place their advertising: at the beginning, during the podcast and at the end of the current episode. It is also possible to sponsor a complete episode. For listeners, advertising at the beginning of the podcast seems the most enjoyable. Financing podcasts through advertising is generally accepted, but only if the listener has free access to the content. Less welcome, however, is financing podcasts through crowdfunding.

In order to earn money with podcasts, the advertising can be spoken by the host itself. Advertisers can monitor this form of native advertising based on the number of downloads of the URLs provided or certain discount campaigns. This form of advertisement is, for example, used in the interview podcast “Hotel Matze”, which tells listeners more about well-known people, their opinions and experiences. The podcast is usually sponsored by Heineken, but also mobile operators or magazines. Within the first minutes of the podcasts, the host, Matze Hielscher, reports about the cooperation before he continues with the podcast sequence.

The most successful German podcast “Fest & Flauschig” by Jan Böhmermann and Olli Schulz relies on exclusivity, as it can only be heard via the music streaming service Spotify where the platform first pays the hosts. The podcast sequence is additionally supported by the play-in of an advertisement at the beginning.

It appears that there are many ways to place advertising in podcasts. It remains exciting in any case: What remains interesting is the change in the future. Will advertisers be using podcasts even more intensively in the future?

– For questions and suggestions please contact HBI

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