Highlighting the Effectiveness of Podcast Advertisements in 2024
Audio listening has hit an all-time high, with 98M Americans tuning in every week and 135M monthly. Along with audiences expanding, Americans are clocking more listening time. The average time spent listening to digital audio has grown in 2024, with a 26.4% increase in total time spent and general familiarity with podcasts climbing 9% since 2020. The average American now listens to a total of 8.3 podcast episodes weekly. This profound increase in podcast consumption has fueled the growth of the preeminent listening platforms, including Apple Podcasts, Spotify, Pandora, and iHeart Radio.
While North America boasts the most podcast listeners, listenership around the globe is increasing, particularly in Latin America and China, where consumption is set to exceed North America’s numbers by 2025.
Also notable for 2024 is the increase in the number of monthly and weekly podcast listeners across all age groups. While millennials still comprise the largest listener demographic (32%), Gen Z is set to overtake them by 2027 (though in 2024 28.9% of Gen Z is tuning in, their rate of podcast discovery outpaces every other demographic). Listeners aged 55 and above are growing at a staggering rate too, increasing by 22% between 2021 and 2023.
For brands looking to effectively drive consideration, podcasts are far and away the preferred channel by consumers. 64% of consumers pay full attention to podcast ads and 95% of regular listeners take action after hearing one. “If you took even the most engaged paid advertising channels, they don’t get close to podcasting,” Jon Evans, chief customer officer for ad effectiveness company System1 said at Podcast Advertising Summit in January—and the stats clearly back that up.
In 2024, there’s also a new kid on the audio block worth paying attention to. Amplifying the power of traditional podcasting is the rising medium of video podcasts. They offer all the benefits of podcasts, with the engaging experience of added visuals. Video offers a new way to diversify podcast placements and is definitely worth sitting up and paying attention to. In fact, in 2024, for the first time ever, more podcast enthusiasts have watched their podcast in the last 30 days than have listened to them according to Sounds Profitable.
[Download: Podcast Advertising: More Than Meets the Ear]
[Download: Vodcasting 101: What It Is and Why You Need It]
[Read: The Ultimate Guide to Podcast Advertising]
What Is Podcast Advertising and How Does it Work?
Podcast advertising is when brands pay for placement of their advertising within various podcast shows. Podcast ads can be bought directly from networks, podcast show hosts or programmatically via DSPs (demand-side platforms) using an audience-based buying approach. Types of podcast ads include:
- Traditional Ad Units
- Fifteen, thirty, or sixty second ad spots that are delivered pre-roll, mid-roll and/or post-roll. They come in two forms:
- Host Reads (pre-recorded or live)
- Endorsements or non-endorsements
- Voiced-Over Reads (pre-recorded by someone who is not the show’s host)
- Host Reads (pre-recorded or live)
- Fifteen, thirty, or sixty second ad spots that are delivered pre-roll, mid-roll and/or post-roll. They come in two forms:
- Custom Segments
- Ad reads that are not a typical 60 second spot read or endorsement and are a custom brand integration weaved into the show.
- Presenting Sponsorships
- This likely includes a pre-roll mention and both a mid-roll and post-roll ad read and will last for the entirety of a show’s season or a predefined amount of episodes. It can also be negotiated so that the advertiser has 100% share-of-voice in the episodes.
[Read More: Podcast Advertising Types & Examples]
2024 Podcast Advertising Statistics
One of the common misperceptions about advertising on podcasts is that the inventory is limited and it is difficult for brands to achieve meaningful scale. While this may have been true several years ago, the rapid growth of the podcast listener base and overall increase in the number of shows, has made such challenges a thing of the past.
Based upon the most recent research study conducted by Edison Research, The Infinite Dial 2024, there are 135M monthly listeners equating to 47% of the total US population.
Media spending has begun to shift to podcast advertising as a result of this astounding growth and expansive, captive audience. According to IAB, 2024 will see an overall 9.5% increase in global ad spend with podcast advertising expected to snag 2.5B of the budget in the U.S. alone, representing an uptick of 19% year over year.
What are the Benefits of Advertising on Podcasts?
There are many benefits to podcast advertising. In fact, the channel is highly functional across the funnel, allowing brands to do everything from build awareness and consideration to convert listeners.
Build Brand Awareness
Podcast advertising is highly effective for building brand awareness and promoting overall brand lift, with advertising across industries driving an average of 28% improvement in baseline awareness across industries, and 24% improved brand recall.
Since podcasting boasts high engagement among its user base, it is useful for increasing visibility to new audiences. Engaging storytelling, consistent messaging, and targeting can all contribute to enhanced brand awareness.
Reach New Audiences
The ability to target new and niche audiences through precise targeting allows businesses to connect with specific demographics and interest areas, building trust and loyalty along the way. Podcasting is also particularly effective at driving incremental reach for brands, working harmoniously with campaigns to increase reach by as much as 19% for some demographics.
Cost Effectiveness
As podcast advertising has expanded, it has grown to offer a wide variety of pricing options to meet the specific budgetary needs of all brands. In particular, programmatic audio has lowered the bar for entry into podcast advertising without compromising on ROI. In fact, in 2024, 62% of buyers say they will boost investment in programmatic ad buying.
Find out more about the ease and efficacy of programmatic audio here.
Boost Positive Perception
Podcast listeners feel significantly more positive towards the brands that support the medium than they do of radio listeners or TV viewers. There is a halo effect of positive brand association just by advertising on the medium. Across genres, positive association with hosts and shows extended to brands according to research from Audacy.
Improve Cross-Channel Marketing Effectiveness
Adding podcast advertising to your mix improves performance across the board. By incorporating podcast advertising into strategy, many brands have seen reinforced messaging do things like increase website traffic and contribute to overall brand lift, maximizing their investments across other channels. Research has shown that among crucial segments like 25 to 54 year olds extends brands’ reach by 12% for radio listeners and 15% for TV viewers. In a survey by Acast, most marketers indicated that podcast advertising improves overall campaign effectiveness by 21 to 40%.
Increase Sales
Podcasts are an extremely powerful tool for generating leads and driving sales. A well-crafted podcast advertisement can perform as a crucial piece of the sales conversion pipeline. According to the latest research, 61% of key demographics—like Gen Z—visited a company or product’s website after hearing an advertisement on a podcast. Meanwhile, another 61% indicated they explicitly wanted the product or service in question.
Some ARM clients saw as much as a 6% growth in conversion after running podcast campaigns.
Flexibility & Creativity
The flexibility of podcast advertising means that there are more possibilities for the format to align with the needs of brands and their audiences. Listeners expect an intimate flavor of ad creative, allowing brands to connect authentically. Whether integrated or live-read, the channel opens up the possibility for detailed discussions of the product or service while benefiting from the baseline positive perception of podcast ads. In fact,. 46% of listeners say that compared to other formats, podcast ads are “not intrusive at all.”
Targeted Reach
Podcasting offers a wealth of audience segments—and in very niche interest areas. The most common demographics include age groups, gender, location, and language, but the wealth of data available on podcast listeners enables brands to select more refined audiences that are aligned with their brand and likely to be receptive to their messages, such as restaurant visitors, moms or dads, video game players, and more. Research has shown that podcasts reach key demographics across a vast listenership—who are spending more time than ever with the medium.
How Do You Measure the ROI on Podcast Advertising?
With recent advancements and new capabilities offered by third party providers, virtually any business model can structure an effective test-and-learn campaign to begin to establish a baseline ROI for podcast advertising. With a wealth of tools and strategies, podcast ad performance is more measurable than ever.
Promo codes
Custom promo codes on individual podcasts are an effective incentive for purchase as well as method of ROI measurement. Creating a unique promo code for each podcast episode or show is a great avenue to capturing show level data, gauging which produce the most sales. Creating a direct link between a particular campaign and customer measurement, promo codes measure who is actually engaging with your business. In order to leverage this method, advertisers just need to ensure they have the right technical infrastructure to track multiple unique promo codes and sales channels can accept them, providing reporting down the line.
Vanity URLs
A vanity URL is a polished, tried and true direct response measurement tactic that works as well in podcasting as it does in other more traditional channels like DRTV. Vanity URLs are not only a means of attribution that helps teams clearly see which podcast episodes, shows, or specific ad creative are driving the most traffic and conversion, but can also make it easy for listeners to navigate to your website and offer opportunities to reinforce brand identity and improve brand recognition.
Post-Conversion Surveys
Post-conversion, “how did you hear about us?” surveys are an ideal way to get valuable insights into the factors influencing customer decisions while also measuring exposure, recall, and channel effectiveness. Since there is no single certain path to conversion that marketers can anticipate, surveys offer a way to gain concrete information about what users remember on their specific journey. And because listening to a podcast demands the audience’s full attention and advertisers’ messages are typically more memorable in this channel, surveys are a powerful route to quantifying the ROI of podcast advertising.
Pixel-Based Attribution
Pixel-based attribution is one of the newest additions to the podcast measurement world, tracking exposure to ads and subsequent website activity. This allows advertisers to track every action a user takes on their sites, helping them to measure and upgrade marketing efforts. While “offline” listening can prove a challenge for this method, third party measurement partners have rapidly been developing technical solutions by pixeling the RSS that is used to download individual shows and then tracking resulting web traffic.
At Ad Results Media, we believe that the best measurement solutions capture the signals from one or more of the four measurement methods and analyze the results in the context of your business model, technical capabilities, and campaign objectives. We work with all of our clients to create a custom measurement plan and model their brand’s ROI.
Advertise on Podcasts
Define Your Goals & Outcomes
A key first step in planning any campaign is to define goals and intended outcomes. This is essential groundwork to develop a podcast ad strategy that works. Clear and measurable goals allow brands to establish the right strategy, connect with the right shows, define the right delivery methods, allocate budget, and adjust as necessary to deliver a winning campaign
Finding & Vetting Shows
There are a lot of podcasts to choose from. When a brand sets out to find shows that will resonate with their target audiences, the prospects may seem endless. In the same way, finding the perfect influencer partners on social media can seem overwhelming and manual, now imagine doing that without the functionality of the social media platforms and the additional benefit of hashtags.
Once you make a list of potential podcast advertising partners, you need to begin vetting them for campaign fit by downloading and listening to at least two or three of their episodes. This will help you get a feel for the content and tonality of their show and what type of ad creative may resonate best. This is also far more arduous than simply scrolling through an influencer’s Instagram feed to get a sense of brand fit and content style.
When you partner with a specialty agency that has successfully run tens of thousands of campaigns, they have proprietary tools that assist with the selection process as well as historical knowledge and relationships with the top-performing shows by genre to reduce vetting time. At Ad Results Media, we’ve cultivated our audio-first expertise for more than 25 years, testing thousands of podcasts, establishing relationships with a wealth of creators, and comprehensively tracking performance to continually optimize approach and delivery so our partners get the best possible results.
Develop a Podcast Media Buying Strategy
Once the podcast partners have been selected and vetted, it’s time to actually buy the media. There are a number of podcast networks and marketplaces that can simplify this process significantly, but they can’t fix the underlying inconsistencies. Rate cards and metrics may not be uniform or even IAB compliant for that matter. And due to the high degree of creative customization often required to do host-read ads or brand integrations, you run the risk of miscommunications and unmet expectations.
A specialty agency provides its clients with a uniform view of planning KPIs and ad optimization metrics. They leverage their experience and relationships to secure the right placements for the campaign goals, help produce traffic and verify all ad creative.
Build Your Podcast Ad Creatives
Creating the perfect ad creative is both an art and a science. In crafting a message, brands should consider the tone of the podcast they are working with and craft messaging that aligns with that. Using short, conversational sentences with straightforward information and clear CTA is also helpful. Other considerations include length (this will vary based on your campaign goals), background music, and delivery method (i.e., will the ad be pre-recorded or delivered “live”).
Ad Verification
Verifying your ads ran and ran correctly can become a very manual and time-consuming task for brands looking to navigate the space on their own. Some shows will simply send a link to the episode and require you to listen to it in its entirety to verify the ad placements, others will provide actual airchecks or snippets of the show for verification purposes. There are third party tools that exist, but without expertise representing the brand, it’s impossible to know how well the platforms are performing the evaluations. Expect a number of different reporting formats with little standardization if placing your own podcast ads.
At Ad Results Media, we have developed a proprietary ad evaluation process to address the lack of standardization. All spots are evaluated based on specific requirements and endorsements are graded on several components using our proprietary system. Here are two examples of what we evaluate:
- Placement – Where did the spot run? A spot run within the show’s content or first in break receives the highest grade.
- Duration – How long was the spot? Spots receive a passing grade if they are greater than 58 seconds.
Create a Measurement Plan
As with any relatively nascent media channel it comes with some measurement and attribution challenges; namely the same fragmentation that complicates the entire ecosystem compounded by the requirement that it works across all placement types from host read ads to branded series.
At Ad Results Media, we believe that the best measurement solutions capture the signals from one or more of four measurement methods: promo codes, vanity URLs, surveys, and pixels. We work with all of our clients to create a custom measurement plan and model their brand’s ROI. This helps to create an apples-to-apples comparison from which to make future planning and buying decisions.
[Read More: How to Measure Podcast Ad Performance]
[Read More: The Ultimate Guide to Podcast Advertising]
The Bottom Line—Does Podcast Advertising Work?
We believe that podcast advertising is the ultimate driver of brand marketing success, but don’t take our word for it. Our clients have been able to demonstrate impressive and meaningful results.
Check out a selection of our clients’ case studies here.
Interested in creating your own podcast? Check out these great resources:
How to Start a Podcast at Home
