Spotify announced a major event in January: they are now going to launch their own proprietary podcast advertising technology. Named “Streaming Ad Insertion”, it will be applied predominantly to Spotify’s original programming and shows that are exclusive to this platform. Since they have already established a connection to millions of podcast listeners, they do possess a prime position for dominating in digital advertising.
Spotify Podcast Ads are powered by Streaming Ad Insertion, which delivers Spotify’s entire digital suite of measurement, reporting, and projecting. What is being offered is a product that has the quality of traditional podcast ads with the ability to hone in and precisely tweak and monitor the most crucial elements. Spotify Podcast Ads can measure real impressions the second they transpire, reporting on age, gender, and behavioral traits of the audience.
Joel Withrow, senior product manager of podcast monetization at Spotify, adamantly claimed that this is the only place where podcasts are getting reach at a scale that’s supported by concrete advertising, and Puma was the first customer to try out the offering. After they chose to do so, a blog post noted that the campaign drove ad recall lift for the brand of 18 points.
There was a TechCrunch report from a year ago that reported Spotify had been selling ads on its podcasts for the previous year, and was gravely interested in approaching their ad tech. In June, it was officially announced that brands could now target ads with them to the platform’s free-tier listeners based on what podcasts strike their interest. This is a massive sign of profitability potential within the podcast realm, and a way to surpass wildest expectations in regards to direct targeting.
Some of the very key core execution details are still being ironed out, like the standards of the ad unit format and how the waters of creative production will be navigated. Ads that are read by the host aloud are expected to be the dominating format, but production teams may go deeper and get imaginative to create copy that “feels like it comes from the world of the show”.
As it stands now, the level of podcast creation and consumption continue to outpace actual monetization, and this could change drastically with this introduction of SAI into the picture. There are risks in this territory as well: becoming such a dominant provider of all podcasting dollars can create complications for any entity that has an entire share of a market.
There is even a partnership slated for next year with Higher Ground, Barack and Michelle Obama’s production company, as well as familiar favorites such as Parcast. Parcast is a leading podcast studio that features crime and mystery shows like Unsolved Murders, Cults, Serial Killers, and Conspiracy Theories. Since joining Spotify, they have also launched two daily podcasts: Today in True Crime, and Horoscope Today.
Research completed last December shows that 51% of the US population has listened to a podcast, and that podcast listeners are loyal, affluent, and educated. 90 million people listened to a podcast during the last month, and 62 million people listen to podcasts weekly. 45% of monthly podcast listeners have a household income over $75K – vs 35% for the total population.
27% of US podcast listeners have a 4-year college degree, and podcast listeners subscribe to an average of 6 shows. This is NOT the medium to be thought of as akin to “sitting by an old-fashioned fire with the droning of a sleepy baseball game” decades ago. Podcast listeners are absolutely people with disposable income and a knack for repeat business, and since they have already made the choice to turn into a certain medium, will not experience frustration at products being pitched to them that have been selected through careful research.
Just like what Spotify is doing here within the realm of podcasting, Facebook currently provides data that can be layered over the geographic target area to very closely hone in on what users are interested in. Here at Farfetched Studios, we have an enhanced solution that provides us access to 1st party data as well as 3rd party audience targeting that will “add the thunder” in a major way to any marketing campaign! We are no doubt living in exciting times, and are excited to “provide the drawbridge” for your company to reap the rewards of revenue through precisely targeted digital means.
