With podcast advertising maturing, more mainstream brands want in on growth

This 12 months, podcast advertising is anticipated to account for $2.25 billion of advert spend and develop to $3.53 billion by 2026, in line with Insider Intelligence. Even with financial uncertainty placing advertising and marketing budgets beneath intense scrutiny, podcast advert consumers mentioned in February that they had but to see a slowdown.

At the helm of that advert spend are more and more more mainstream brands like Molson Coors’ Simply Spiked juice line, The Weather Channel and Sleep Number, all of which wish to leverage podcasts’ improved measurement capabilities, higher concentrating on and rising audiences.

Over the final 12 months, Sleep Number’s podcast advertising spend has grown to account for 20% of its audio advertising finances, mentioned Lisa Bailey, the model’s vp of media and content material technique. (She didn’t disclose particular advert spend figures.) Per Bailey, that spend on podcasts has been steadily rising over the past 5 years, particularly as audiences develop round more area of interest matters. 

“It’s one of our highest driving return on investments for us and it’s just growing,” Bailey mentioned, including that podcasts drive gross sales for the corporate. (She didn’t disclose particular sale figures.) Per Bailey, the corporate makes use of media combine modeling to find out podcast advertising ROI. “Because of the impact that has and what we can monitor, we can really see that this particular media form is super engaging and we get huge engagement against it,” she mentioned.

Last summer season, Simply Spiked obtained into podcast advertising with the launch of its Simply Spiked lemonade, however the plan was very small in scope, in line with Josh McDonald, senior advertising and marketing supervisor of FMBs (Flavored Malt Beverages) at Molson Coors Beverage Company. (He didn’t provide particular advert spend particulars.) Before that, in 2020, Molson Coors turned a constitution sponsor of Charlamagne tha God’s Black Effect Podcast Network. And, forward of launching its newest spiked peach drink this month, the corporate mentioned it should lean even additional into podcast advertising. 

“We know podcasting is growing in leaps and bounds year-on-year,” mentioned McDonald. “It’s integrated into our strategy. It’s not a test and learn. We’re leaning into it. It’s a strong piece of our media strategy.”

Meanwhile, The Weather Channel ran a podcast advert marketing campaign on Pandora final summer season, which drove a 6% elevate in general model favorability, in line with Samantha Cohen, head of promoting know-how and media for The Weather Company, an IBM Business. Per Cohen, analysis confirmed that just about half of The Weather Channel’s audience tuned into 4 or more podcasts on a weekly foundation, making it a channel price testing to get in entrance of that viewers.

There are a number of causes brands appear more eager on podcast advertising now than they’ve in the previous, company executives say. They embody higher measurement instruments, elevated listeners and more exhibits (thus more genres and audiences) to select from. For occasion, again in 2020, Spotify rolled out Streaming Ad Insertion (SAI) know-how to assist advertisers with digital planning, reporting and measurement. There’s additionally programmatic podcast advertising, which has sparked some advertiser curiosity regardless that it’s nonetheless in its infancy.

And not like different advertising and marketing channels, podcasts are immersive as a result of they seize a listener’s full consideration at the same time as life returns to regular post-pandemic. (Although it’s price noting that the audio increase has cooled some since its spike throughout pandemic lockdown.)

“While the end of 2022 saw growth in investment from traditional audio/radio slow a little bit [following the pandemic boom], interest from non-traditional audio clients focused on brand advertising continued to increase,” Jimmy Saunders, govt director of audio and occasions at New York Times Advertising, mentioned in an e-mail to Digiday. 

While enhancements in podcast advertising, like higher measurement and concentrating on capabilities, have made it simpler to purchase adverts via programmatic channels, there are additionally new channels, like YouTube including podcasts to its music app. And new video podcast capabilities are being added on platforms akin to YouTube and Spotify.

“A big thing you’re seeing happening on podcasts that was similar to digital 30 years ago is, right now, a lot of brands are looking at audiences at scale,” mentioned Brian Berner, Spotify’s Head of Sales for the Americas. “Podcasts are still growing and audiences are still growing.”

On common, U.S. adults will spend about one hour and 43 minutes per day listening to digital audio, like podcasts, this 12 months, per Insider Intelligence. That determine is anticipated to extend barely subsequent 12 months to an hour and 45 minutes per day. 

With that mentioned, the podcast advertising business is poised for growth amongst model advertisers, particularly as diversification of media spend continues to be a subject of dialog all through the business.

“What was once a go-to element in the marketing mix for strictly DTC brands has begun to mature significantly,” Patrick Schmidt, managing director of Wheelhouse Labs, mentioned in an e-mail to Digiday. “Brands accustomed to taking risks to reach their audiences through evolving platforms are winning big with partnerships in podcasts.”

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