Why Listeners Respond to Podcast Ads

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Welcome to The Yard, a blog by Backyard Media that explains the podcast industry and podcast advertising.

How effective is podcast advertising when it comes to impacting customer behavior? A 2016 study from Edison Research, in partnership with the Interactive Advertising Bureau (IAB), looked into just that. We've discussed previously how podcast advertising impacts brand lift and brand sentiment among listeners, but this study looked at the effects that podcast ads can have on listeners in much more detail. Specifically, Edison Research asked listeners how they view podcasts as a medium, how they view podcast advertising, and how marketing on podcasts can positively affect buying behavior and other customer actions. Below we summarize the most interesting and relevant data for podcast advertisers from this wide-ranging study.

 

Listeners value podcasts because they offer the content and control they can't get from other digital media.

Edison Research's study surveyed more than 900 American adults that it identified as current podcast listeners and then queried them about their current podcast habits and sentiments. When it came to which aspects of audio technology were most important to them, respondents had very clear reasons why podcasts were their audio technology of choice:

  • 76% of respondents said it was "very important" that they had the ability to listen to audio WHENEVER they wanted.
  • 71% of respondents said it was "very important" that they had the ability to listen to audio WHEREVER they wanted.
  • 70% of respondents said it was very important" that they had the ability to listen to audio instantly, as soon as they found it.
  • 58% of respondents said it was very important" that they had the ability to listen to audio content they couldn't find anywhere else.

What does this tell us? This section of the study confirms that listeners value podcasts for very specific reasons. First, more Americans are gravitating towards podcasts as the listening technology rapidly evolves, such that a majority of American listeners (71%, also from this study) consume their podcasts via easy-to-use smartphone apps.

And as we stated in our very first blog, a podcast is by its nature an on-demand audio file. Compared to a public radio news show, a listener can download a daily news podcast and listen to it whenever - hours, days or even weeks later. By the same token, podcasts are immediately available if listeners want to hear them immediately. Most podcast files are small enough that listeners can download files even by 4G/LTE data on their smartphone, so access is never a concern.

Finally, podcasting has become a creative industry of its own, and listeners appreciate that the medium has become a way to get unique content. Media organizations like NPR, WNYC, WBUR, Slate, the New York Times, and others are creating podcast-native content. As well, many new, private podcast studios are exclusively focused on generating high-quality, podcast-only content. Podcast listeners know and appreciate that much of the content they hear on podcasts won't exist anywhere else. Advertisers should have the same mindset, and know that to reach these listeners and connect their brands with this content, they must employ podcast ads. 

What does this mean for podcast advertisers? Podcasting has a strong foundation because as listeners appreciate the technology and content that make it a unique digital medium. Sponsors should aim to leverage this strength by expanding their marketing to podcasts, both to capture this growing segment of listeners and to connect their brands with this podcast-only content.

Listeners believe hosts make genuine recommendations when they read a podcast ad

Sponsors starting out in the podcast industry often hear the same line over and over: that podcast hosts have a unique relationship with their listeners. It's repeated so often because it is such a differentiator for podcasts among digital media - podcasts feel much more personal compared to online videos or banner ads.

Edison Research confirmed this point when it asked about host-read ads. Recall from a previous blog that the majority of podcast ads - about 60% in 2017 - feature the host reading the ad script or otherwise speaking on behalf of the sponsor. When Edison asked whether listeners thought a podcast host was making a recommendation for a product or service they'd actually used, a full 52% of respondents said they strongly agreed or agreed that the podcast hosts they listened to had in fact used the advertised product or service.

This finding makes sense - listeners see hosts as genuine people that they have a relationship with, and they trust their recommendations as they would a recommendation from a friend. Because of this, they are more likely to believe that that recommendation comes from actual experience.

What does this mean for podcast advertisers? This belief in genuine recommendations helps drive the strong efficacy of podcast ads. Podcast advertisers, however, must follow our advice from our previous blog - give podcast hosts the chance to try the product or service. By doing so, hosts have a solid footing by which to understand the product and give a true recommendation. This has become standard practice in the industry and helps support the vital listener-host relationship.

 

Listeners respond more positively to host-read ads than pre-recorded sponsor ads

The host-listener relationship likely has a part in Edison's next finding. The survey asked respondents about how they felt about the podcast ads they hear, specifically whether they found them useful or otherwise didn't mind hearing them. They found a marked difference depending on who was reading the ad. For "products or services mentioned by the host" (host-read ads), 55% of listeners had a positive or strongly positive view. For "pre-recorded advertisements from a brand, company, or sponsor" (produced ads), 34% of respondents had a similarly positive view.

While this difference of 20% is notable and should be an indication that host-read ads are the most effective type of podcast ad, both levels of support are much higher than those for advertisements on other digital media - for example online video pre-rolls, banner ads, social media ads, which often score in the single digits for positive sentiment.

We've noted that while they are still a minority, produced ads (where someone other than the host is speaking) are on rising in popularity - we outlined in a previous post what makes a produced ad work well.

What does this mean for podcast advertisers? Host-read ads engender a much higher positive sentiment than produced ads (those with a different narrator). Produced ads are rising in popularity, however sponsors new to the podcasting space should first try to leverage the depth of the unique podcast host-listener relationship.

 

Listeners are much more likely to consider, research, purchase and recommend a product after hearing a podcast ad.

The most important metric for any sponsor or marketing team is how their ads translate into conversions and other customer behaviors. At the heart of Edison Research's study was a look into how likely podcast listeners were to take certain actions after hearing an ad on their podcast. Edison Research asked listeners about a number of actions, summarized in the table below:

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What should we take away from this?

  • Podcast ads lead listeners to conduct their own research about brands. When prompted with a brand's podcast ad, 45% say they will then look at the sponsor's website and 42% will consider a new product.
  • A full 28% of listeners report they use promotional codes from a podcast ad - a huge level of direct response (more about direct response ads here)
  • When it came to purchasing a product, 25% of listeners bought a product after hearing it in an ad and 8% say they bought a product for their business. Interestingly, 17% of listeners become evangelists for the products themselves, recommending them to another person, showing that podcast listeners regard ads on a podcast much like they do the content of the show itself.
  • One final note is the 15% of respondents who report attending an event. This shows that advertising on podcast can be effective for sponsors who sell experiences instead of products, like conferences or limited-run events.

Finally, researchers also asked podcast listeners if they lean more toward companies that advertise on podcasts versus those that don't. A full 60% of respondents said that, when price and quality are equal, they prefer to buy from companies they hear about on podcasts.

The bottom line is that podcast advertising is effective, more effective than any other form of digital advertising. That effectiveness is rooted in the host-listener relationship and in listeners' receptiveness to podcast ads as content, not traditional marketing. As Edison Research's Vice President of Strategy Tom Webster said when asked about this study, “Podcast listeners not only don’t reject advertising in the medium, they are actually very receptive to the right message, delivered in the right environment.”

 

Are you ready to harness the power of podcast advertising as a part of your marketing strategy? Contact us here to get started advertising on one of Backyard Media's podcast partners.

Backyard Media is a marketplace for podcast advertising. We connect content creators of all shapes and sizes with awesome sponsors, providing them with the resources they need to do what they do best. Everyone wins.