The podcast format continues to grow rapidly and to attract listeners and advertisers. James Foti has some useful advice for the latter.
Podcasts in their current form have been around for nearly 20 years, helping us stay connected, engaged and entertained wherever we are. In recent years the format has grown exponentially: before lockdown, listenership had risen 31% in just nine months1 and early indications are that working from home has had little impact on that trajectory – 64% of listeners2 say they’re tuning in to the same amount of podcasts while staying at home and a quarter are listening more.
Providers and streaming services are starting to take note; 12% of new Spotify subscribers state that podcasts are an important part of the platform’s offer, which is significant given its heritage as a music streaming service. As a result, we expect the business and its competitors to prioritise the format over the next few years and drive continued growth.
In this context, it’s not surprising that brands are clamouring for a bite of the advertising cherry. A word of caution, however: in the timeline of traditional media, and compared with the likes of print and television, podcasts are still relatively new and largely untested in terms of return on investment.
But this could be a lucrative audience. Podcast listeners spend £474 a year on entertainment alone – 30% more than the average shopper3. Demographically, 65% of listeners are from the more affluent social class of ABC1 and a quarter earn more than £60,000.
But how can brands tap into this spending power effectively? The answer lies beyond surface-level demographics, in confirmed purchasing behaviour.
Consider opportunities to buy
It’s one thing to identify followers of a parenting podcast as target customers for a household brand, but what if they never visit stores where a product is stocked? Mother’s Meeting listeners, for example, are more likely to do their weekly shop at Tesco, while those that tune into Fearne Cotton’s Happy Place visit Marks & Spencer and the Co-op. Consumers who already have the opportunity to buy a product are much more valuable and brands should prioritise partnering with those podcasts that reach them.
Volume and value are different things and it’s not enough to just target large audiences. How much do they spend each month on groceries, entertainment, fashion or meals out? To maximise ROI, brands must consider the purchasing power of listeners.
Look for deeper insights
Let’s say you’re placing adverts on behalf of a multinational confectionery business. You start by thinking about what your customers might be listening to – perhaps parents are tuning in to Happy Place and retirees are more likely to be fans of the BBC’s Newscast. You can make a pretty good case for where to direct your budget based on the fact that 700,000 households listened to Happy Place in March and 1.1 million households listened to Newscast. But what if you could underpin it further? It’s Newscast listeners who have a sweet tooth – the audience spends £9.4 million4 on sugary treats each month, compared with the £6.1 million spent by Fearne Cotton fans.
By harnessing this type of insight, brands can truly target and justify their marketing spend, ensuring valuable budgets aren’t wasted.
Think about different formats
These principles also extend to content creators. From international media outlets to SMEs and individuals, everyone is starting to get in on the action, viewing podcasts as a way to build brand awareness, to communicate direct to customers and as an outlet for their own creativity.
Much of the appeal lies in the perceived low production costs and scope for editorial freedom. But every choice, from episode length and frequency, to conversation style, guests and music, must be based on evidence to lead to success. The podcast market is building a strong following among certain demographics, but there are significant opportunities within those that aren’t being catered for. Four in ten (38%) men and women5 say they would listen to podcasts if there was something that interested them and a third of people report a lack of free time as their main obstacle to listening more. Shorter, bitesize podcasts could help reach these untapped audiences.
What else do target listeners download? What makes them tune in for another episode, and another? Where do they shop and what are their favourite brands? Having clear answers will help shape the development of the podcast and also ensure that advertisements can be chosen that don’t turn an audience off.
As the podcast market becomes more established, quantifying audience value meaningfully will be vital to commercial success. Whether it’s identifying the best partnerships for brands, securing advertising investment or launching a podcast, subscriber numbers alone won’t cut it.1 Kantar | Entertainment Panel | 4 w/e 28 July 2019 vs 4 w/e 8 March 2020
2 Kantar | Entertainment Panel | 4 w/e 5 April 2020
3 Kantar | Entertainment Panel | 52 w/e 8 March 2020
4 Kantar | Worldpanel Plus Survey – 55877 respondents | purchase data from 10 w/e 10 March 2020
5 Kantar | Worldpanel Plus mobile survey – 51249 total respondents | w/e 2 September 2019