‘I’m Just Looking for That Personal Connection’: Podcasts and the Audio Ad Market

By Nick Fisher

With monthly podcast listenership increasing by 75% over the past 4 years, it’s unsurprising that people are starting to pay serious attention to this audio upstart. This is particularly true in the USA, where monthly podcast penetration has now reached 24% (the same amount of online Americans who use Twitter).

As consumers have started to interact more with podcasts, this has brought increased commercial activity in the space: tech giants (like Stitcher and, more recently, Spotify) are now jockeying to challenge Apple’s podcast heritage. Furthermore, major household brands (like Virgin or Oprah) have begun to carve out their own slices of this lucrative podcast pie. And lucrative it is: the growth in the US podcast market has brought with it a flood of advertiser funding, which is predicted to reach an estimated $220 million in 2017. There’s just something about podcast advertisements that users are connecting with.

Podcasts listeners (even in the UK) are highly engaged. British users listen to more than two-thirds of downloaded podcasts and 88% of subscribers will listen to all of a show’s episodes. But beyond the podcasts themselves, listeners are showing more engagement with the ads supporting them. Not only do users have high recall and relatability of ads on these channels, but podcast advertising agency Midroll reports that 65% of podcast listeners have bought something after listening to a podcast.

While brands and celebs across the USA are rushing to get a toe-hold in the ear-holes of the American populace, podcasts haven’t had the same degree of success in the UK.  Across UK adults, podcasts only reach 10% of the population (compared with the 90% reach of live radio). However, this number is growing every year. In preparation for the inevitable rise of podcasts in the UK, it is useful to take a look at what is driving the wild success of podcast advertising in the States – and the fascinating commentary about what this might say about the humanisation of ads in the audio market.

The Intimate Podcast Advertising Market

Somewhere in the middle of your favourite advertiser-supported podcast, the hosts may take a break to talk about the products that keep their show on the air.

While the hard sell remains at the heart of these ads, something feels different about them. For the most part, these advertisements are refreshingly frank and loosely scripted, with many hosts adding their own ad-libs throughout. Crooked Media’s Pod Save America, for instance, regularly produces legitimately entertaining ads, weaving together the in-jokes and life experiences of the hosts with the weekly foibles of the American administration. A recent episode produced a highly engaging ad out of the host’s upcoming honeymoon, Trump’s trip to Mar-a-Lago, and a new e-payment app.

The sincerity that listeners look for in their favourite podcasts is reflected in host-read ads such as this one (this format is dominant in the podcast market – about 95% of US podcast ads are now read aloud by the presenter). These moments depend more on rapport between the hosts and their audiences than on the witty wordplay of the ad script, resulting in intimate, personal, and (seemingly) organic ads.

‘Stories and Conversation Instead of a Sales Pitch’

This host-read format is far from novel: in the 1920s, radio presenters exclusively read out advertisements on their programmes, providing personal assurances of the brands and products showcased on-air. However, as listeners grew more cynical of the hosts sincerity, broadcasters flipped the model, developing flashier, discrete radio spots that (they hoped) stood out in listeners’ minds as much as they did from the rest of the broadcast. These strictly scripted, oft-repeated ads remain a firm part of the audio landscape.

That almost one hundred years down the line we are returning to this model speaks to the trust that has returned to the presenters in this small corner of the audio market – and perhaps indicates that listeners are looking for a change.

For many listeners, these ads don’t feel like entities constructed by face-less brands, but as authentic endorsements from real, trusted personalities. As one of our participants recently told us:

‘It’s easy for me to skip, but most of the time I don’t… even though they’re ads, they’re funny and I like listening to them’.

 This change has been noticed in professional circles: As the marketing director for MailChimp wrote in an interview a few years back – referring to MailChimp ads on Gimlet Media’s podcast Startup – this ad-style offers listeners “stories and conversation instead of a sales pitch”.

As the podcast market continues to grow in the UK, there is an equilibrium that will need to occur between intimacy and corporate identity. Brands are eager to get on board with a medium that has shown high returns overseas (co-branding podcasts are starting to become more and more prevalent) – but how strictly branded can podcasts become before they drift away from their intimate, personal roots?

Part of this change may involve rethinking the stiff-collar approach that brands bring to their ads – part of the charm around podcasts like Pod Save America is the playful jabs the ex-speechwriter hosts take at the copy; the connection we build with the Startup ads is the (seemingly) unrehearsed conversations with real employees. These cracks in the corporate façade let the podcast’s intimacy enter into the brand itself – making its ads feel like an organic part of the podcast and, in the process, making the brand feel just a little more human.

By Nick Fisher, Co-Founder at Hook Research

Hook Research is a media research and content development agency. We are proud to provide consumer insights and brand strategy to some of the biggest organisations across media, youth and entertainment all over the world. Want to have a chat about how we can help your business? Get in touch at enquiries@hookresearch.co.uk

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