A Blog by Jonathan Low

 

Jun 15, 2018

Advertisers Are Tuning In To Podcasts

Podcasting's diversity of subjects, personalities and formats allows adherents to do what is increasingly popular with audiences: personalize. 

Advertisers see the opportunity and are following the customers to their mobile devices and smart speakers. JL

Benjamin Mullin reports in the Wall Street Journal:

Advertisers spent an estimated $313.9 million on podcast ads in 2017, an increase of 86% from about $169.1 million a year earlier. The growth in podcast advertising can be attributed to growing familiarity with the medium and smart speakers like Amazon Echo and Google Home have helped expand the podcast audience, making audio advertising more valuable. Marketers are also getting used to purchasing podcast ads in advance, with 38% of podcast ad spending coming from annual upfront buys.
Marketers are starting to tune in to the growing appetite for podcasting.
While podcasting remains a relatively small market, audio firms have made progress in tapping ad budgets for brand advertising, according to a new report from the Interactive Advertising Bureau and accounting firm PricewaterhouseCoopers LLP.
The report said advertisers spent an estimated $313.9 million on podcast ads in 2017, an increase of 86% from about $169.1 million a year earlier.
That is still modest compared with other advertising channels. Marketers will spend about $69.87 billion on TV advertising in the U.S. in 2018, according to estimates from eMarketer. It projects the total U.S. market for digital advertising in 2018 will be about $107.3 billion, with Google and Facebook reeling in an estimated $60.92 billion.
Much of the growth for podcasting came from brand-awareness ads and branded content, which comprised 35.7% of ad spending in 2017, compared with 26.9% in 2016, according to the report.
That is significant, in part, because the lack of independently gathered listening data has hampered podcasters’ ability to persuade marketers to run high-dollar brand-advertising campaigns. Instead, marketers have largely opted to buy direct-response advertising, or advertising that compels listeners to take a measurable action in response to the ad—entering a coupon code, for example.
The growth in podcast advertising can be attributed to several different factors, said Anna Bager, executive vice president of industry initiatives at IAB. Marketers are growing increasingly familiar with the medium, she said, and smart speakers like Amazon Echo and Google Home have helped expand the podcast audience, making audio advertising more valuable. Marketers are also getting used to purchasing podcast ads in advance, with 38% of podcast ad spending coming from annual upfront buys, she said.
“Advertisers are making long-term commitments based on the effectiveness of the campaigns,” Ms. Bager said.
The report projects further growth. By 2020, it predicts marketers will more than double their spending on podcasts from 2017 to $659 million. Meanwhile, spending on some other, more-established channels, such as TV, is decreasing. TV-ad spending will fall by about 0.5% in 2018, according to estimates from eMarketer.

0 comments:

Post a Comment