Podcast ad spend is poised to double over the next two years. There are three main factors for this rapid rise.
Published: May 12, 2022
The IAB Podcast Upfront wraps up today, where the big news is that podcast ad spend is expected to double over the next two years to $4.2 billion.
What’s driving this growth?
On a panel during Wednesday’s Podcast Upfront, veteran podcasters and marketers noted three major evolutions in podcast marketing in recent years:
Audience data, measurement have improved
Until recently, marketers had trouble finding psychographic and demographic data at scale in the podcast space, making it difficult to reach audiences effectively through the medium. Today, it’s possible to reach a specific audience across a podcast network in a single campaign.
As Nielsen and others have established ways to track impressions and measure the consideration of purchasing and the recommendation lift from podcast ads, more marketers are renewing campaigns in the space.
“You actually could really see for the first time what the effect that podcasting had in the marketplace, and it was huge. This really moved the brand needle and has been a trigger for more and more spending in the podcast space,” said Ken Lagana, executive vice president of digital sales strategy at Audacy.
There’s data to show that podcast ads work
Given the improvement in measurement tools, podcast creators are now able to demonstrate that the medium does engage audiences and drive sales in more meaningful ways than other mass media options. Lagana said Audacy recently ran a study that used store loyalty cards to directly link a major CPG brand’s campaign on its podcast network with in-store purchases, basket size and shoppers’ decision to forgo a competitor brand in favor of the one advertised.
“Basically, listening to our podcasts drove that action,” he said. “It’s really amazing stuff.”
The medium encourages experimentation
One of the advantages podcasts offer to marketers is a host of ad options. Brands can send over talking points for a 30-second segment or dynamically insert ads, but they also have the option to collaborate with podcasters and creatively embed their product or service within the programming, said Gary Coichy, founder of Pod Digital Media.
“You can really allow the hosts to have the flexibility to do a deeper dive about your brand and really talk about the person-to-person experience. That’s one of the reasons we are seeing the high numbers above the norms for advertisers within the last 12 months,” Coichy said.
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