5 Things Companies Need to Know Before Getting Into Podcast Sponsorship


You're reading a post from Backyard Media's Podcasting 101, a series of guides meant to explain podcasting and podcast advertising to companies new to podcast sponsorship. To see our other guides, click here

Are you a company that's considering adding podcasts to your marketing campaigns? Podcasts are the most valuable form of digital advertising out there today. But they are also unlike any other kind of digital media. So we've put together a list of must-know items for new sponsors or companies looking into podcast sponsorship. Here are five things that companies need to know before they get into podcast advertising: two decisions they should make about their campaigns, and three points to understand about podcasts as a medium.


1. Have an idea of what you want your campaign to accomplish

Podcast campaigns can do a number of different things. The most well-known type of campaign is the "direct response" ad campaign, where the sponsor provides a discount code or special web URL for listeners to use on the sponsor's site. Those are all well and good, but podcast advertising can be much more than that. Sponsors can use podcasts to improve awareness of their brand, reach new types of customers, or even advertise industry-specific jobs and events in a highly-targeted, time-sensitive campaign.

This decision about what your campaign's goal should be is very important, and if it's your first podcast campaign, the agency you're working with can provide helpful pointers as to which one you might want to choose. Once you've decided that, there are other decisions to make, like your podcast ads' placement and the theme of your campaign.

Maybe your company wants to improve brand awareness, so you choose to go with pre-roll ads, which are shorter and run before a podcast episode's content starts. Or maybe you want to reach out to new listeners and offer them a special discount, so you go with a mid-roll, which comes in the middle of the podcast. Whatever you decide, the bottom line is that, like other marketing campaigns, sponsors should put a good amount of thought into how they want to conduct their campaign and what success would look like for that campaign.


2. Decide if you want to target a specific podcast audience

Podcast listeners are valuable and diverse, so it's worth thinking about what kinds of listeners you want to target. For many sponsors, a general podcast audience (white-collar, wealthier, well-educated, and intellectually curious) is the perfect group to hear their ad campaign. For other sponsors, it might be worth focusing on professionals in particular industries.

What sorts of industries? Well, podcasts cover a vast range of topics. Some particularly important topic areas in podcasting are technology, business, marketing, national security and defense, and the legal profession. We call these podcast content verticals - different areas of the podcast ecosystem where podcasts group around similar topics. And we have evidence that listeners who work in these different fields, like software engineers or lawyers, often gravitate toward podcasts relating to their profession. They might listen to learn about the latest industry-specific news, hear from thought leaders in their field, or to improve their craft.

But maybe your company wants to to target listeners in a particular age range, or listeners with a particular set of buying interests. Luckily, many podcasts have this kind of information about their listeners. By having this target audience in mind, deciding on which podcast creator to work with for your campaign becomes much easier.


3. The value of podcast listeners comes from their demographics and level of engagement

Podcast creators are getting better at understanding their audiences, and this is great news for podcast sponsors. The most common way for creators to collect this information is by running annual or semi-annual listener surveys. By asking listeners to complete a survey, creators can make sure that the ads that run on their podcasts are effective and well-received by their audience.

Common questions on these surveys include age range, gender, income level, profession, location, interests, other podcasts they listen to, brands they want to hear from, and why they listen to the show. Creators will then present this information to companies with whom they're discussing potential podcast sponsorship deals.

Many of Backyard Media's podcast partners have done such studies, and they've found their listeners are highly engaged with their podcast, have disposable income, and are well-educated. This lines up with many studies we've seen that show that podcast listeners are more likely than the average consumer to:

  • be employed full time (54% of podcast listeners vs 45% of the general population),
  • have a four-year degree (27% vs 21%),
  • have an advanced degree (34% vs 23%),
  • and make over $75,000 (51% vs. 38%).

In fact, 15% of podcast listeners made over $150,000 in 2017. Podcast listeners are the ideal audience for sponsors offering all types of products, but especially luxury goods and services.

What's more, our podcast partners have also seen that their listeners are engaged media consumers. They consume above-average amounts of news content. They're intellectually curious and they don't mind longform audio. Perhaps most importantly for companies looking to sponsor podcasts, listeners report that they don't mind hearing podcast ads, saying that ads they hear on podcasts feel like part of the content of the show, and involve products or services they want to hear about.


4. Sponsors need to work with podcast creators to have a successful campaign

This point is where podcasts begin to feel different from other types of digital media. Unlike a YouTube or Facebook ad campaign, sponsors who work closely with podcast creators achieve the greatest ROI for their campaigns. That's because the unique value of podcast advertising lies in the host-listener relationship. Great podcasts have unique brands, and those brands are often closely related to the podcast host(s). Listeners value the podcasts they consume regularly, and they value the hosts that they hear on a regular basis. Listeners even report they feel they have a personal connection with the podcast hosts.

To make the most of this relationship, sponsors should try to give creators an opportunity to try out the product or service in question. This gives creators the chance to develop personal anecdotes for the ad: what did they like most about the product? What feature do they appreciate or think is the most innovative? These points make the podcast ad unique, and listeners feel that they're getting a personal recommendation from the host.

Furthermore, podcast sponsors should provide creators with an ad script, which can range from the exact wording they want hosts to read to list a number of "must-mention" product points. Doing the latter and giving the host more flexibility with the ad allows sponsors to lean on the host's expertise and understanding of their audience. When the host makes an ad sound like the rest of the show, listeners remain engaged and receptive to the sponsor's message. This is the "secret sauce" of podcast advertising: the combination of listener engagement, the host's credibility, and the sound of the ad itself.


5. Putting it all together: understanding the value of podcast sponsorship

There are a number of reasons why podcast advertising is the most valuable form of digital marketing in 2018. In part, it's the audience listening to podcast: a highly engaged group of white-collar professionals with disposable income and a wide range of interests. It's also due to the host-listener relationship, which provides an "intimacy effect" for listeners. Audiences feel like they know the hosts they're listening to, and so advertisements they hear become akin to personal recommendations from a friend or family member.

That's why podcasts offer an incredible value for sponsors. They're a great way for companies who want to find new digital media consumers, raise brand awareness, or build their sales funnel in a new way. 

We always like to relay conversations we've had with marketers who run podcast ad campaigns for their companies. One marketing director recently relayed the following to us:

“Of all [our company]’s marketing efforts, advertising on podcasts has had the highest ROI, by far.”

— Director of Marketing at a technology firm

The data bears this out. Studies have shown that podcast advertising improves listeners' likelihood to purchase by 75% and can improve unaided awareness of a brand name by more than 55%.

It makes sense, then, that industry-wide podcast advertising revenue increased 86% in the past year, totaling $313.9 million in FY2017. We expect this explosive growth to continue as more companies understand the value that podcasts can bring to their brand.



So that's what companies need to know before they start with podcast sponsorship. If you're a company wanting to start advertising on some of the best podcasts out there, consider partnering with Backyard Media. We connect sponsors with independent podcast creators that have valuable and engaged audiences. To get started, get in touch with us by clicking here.


Want to read more guides written specifically for new podcast sponsors? Click here to see our other guides.