Wanna reach a millennial? Buy a podcast ad.
A carry-on suitcase with built-in iPhone charger. A custom-tailored suit. A dental health subscription service my mother describes as a “toothbrush cult.” What do these disparate products have in common? I heard about each of them from a podcast ad, and then I bought them.
I’m 26, which makes me a millennial consumer in all the ways you might expect. I can’t tell you the last time a TV commercial or banner ad sent me running to make a purchase. When I encounter a YouTube pre-roll I can’t skip, I instinctively pick up my phone. Why waste 15 seconds watching an ad when I could scroll Instagram instead? But that doesn’t mean I’m advertising averse. On the contrary, have the guys from Pod Save America spend 30 seconds – maybe even an entire minute – pitching me a product, and I’ll buy anything from meal subscription boxes to custom picture frames. So, what’s the difference?
Podcast advertising is on the rise, and its ability to reach millennial and Gen Z consumers is helping drive its growth. In 2019, companies raked in $402 million in revenue from podcast ads alone, a number which is projected to hit $659 million in 2020.1 Those profits come from the 73 million Americans who regularly listen to podcasts, many of them younger.2 According to Statista, 40% of Americans ages 12 to 24 have listened to a podcast within the last month,3 and one third of millennials – people ages 19 to 35 – report listening to at least five podcast episodes every week.4
Podcasts’ ubiquity has brands rushing to cash in, and the ones who have are seeing real results. According to the Interactive Advertising Bureau’s annual report, 67% of listeners could remember products and brands they heard about through podcast ads, and 63% ultimately made a purchase.5 The podcast space has become so lucrative that even Spotify is making a play. The music streaming behemoth has increased its podcast library by more than 265,000 shows just since February of 2019, and plans to invest millions to develop exclusive podcasts in the coming years.6
Numbers like these are undoubtedly impressive, but why do podcast ads work – and why should brands who need to reach young consumers look at them seriously? First, and perhaps most importantly, podcast ads hardly feel like ads at all.
There are three types of podcast ads: pre-roll, mid-roll and post-roll. Mid-roll ads, the longest spot at between 60 and 90 seconds, are also the most effective.7 This fact is somewhat staggering, given that the typical millennial consumer will tune out of a video ad after roughly twelve seconds.8 Twelve seconds! But when surveyed, 78% of podcast listeners say they actually approve of advertising during their favorite shows, and even that they find those ads valuable.9 This is because podcast ads are not annoying distractions from the feature presentation, but an authentic and seamless subsegment of the main content.
A majority of podcast hosts live-read their ad copy. This provides an opportunity for them to improvise, to relate the ad content to the content of the episode, and to generally make advertising less dry and salesy. This may make the copywriter in me cringe, but as a consumer it’s the sort of thing that’ll make me remember a host’s promo code. This approach allows the host to make an authentic, often personal case for a product or brand – a trait younger consumers more often respond to. In this scenario, the host becomes something of an influencer, connecting with listeners on a more human level. So instead of reaching for that second screen when the commercial break (or pre-roll) comes on, the podcast format actually compels the listener to stay tuned in; while adlibbing hosts make doing so worth both listeners’ and brands’ while.
Second, podcast ads are harder to skip or ignore. Podcasts are the media of multitaskers. Take your favorite show on a run, your commute, or out to cut the lawn, and the ads go with you. Even though you could scrub through a podcast ad, the situations in which we’re listening often makes it difficult to do so. And besides, because those ads are core to the podcast experience, consumers generally don’t even want to.10 This combination of context and content value keeps listeners, well, listening – even in situations where other ad formats may allow their grip on the audience to loosen.
So, what can result from podcasts’ efforts to earn an audience’s attention? When it comes down to it, especially for younger consumers, podcasts can be the spark of a relationship between host and listener – one that extends naturally to the products and brands a host chooses to promote. It’s an authentic circle that invites consumers in and makes it worthwhile for them to stay.
Now, if you'll excuse me, I have to get back to my favorite ads.