Five Reasons to Consider Podcast Advertising

Share the goodness!

I am a B2B marketer, a CMO, and I host Rockstar CMO, a podcast for the Marketing Podcast Network, and I am often asked about the effectiveness of podcasting for businesses to reach an audience, whether to create a podcast, be a guest, or to sponsor or advertise.

Now I have plenty of experience with the first two, but in this article, I wanted to explore the latter, whether you should advertise or sponsor, and share with you some research that suggests it’s time to add podcast advertising to your media mix.

Podcasts are Mainstream

There is plenty of research that supports the notion that podcasts are now a mainstream channel for the consumption of what we call “content” and listeners call entertainment, education, or a way to be distracted while they exercise, take a long drive, or do the washing up.

For example, Edison Research in their The Podcast Consumer 2024 report not only shares that 67% of the US population has listened to a podcast, but it is the young, urban, affluent – a cohort coveted by advertisers – who are doing it the most. 43% of 12-34 year olds are tuning in weekly, 56% of monthly podcast listeners have an annual household income of more than $75k, and half of all podcast listeners are college educated.

The Brand Marketing Challenge

The challenge for many marketers, especially in B2B (and I am a B2B marketer myself) is not making the case that this audience is tuning in, the problem is that it’s fiendishly difficult to pin attribution to this advertising spend and see it show up on our marketing dashboards, in an era when we are all treating data like a drunk uses a lamp post, for support, not just illumination.

I have a personal example of this, I listen to a lot of marketing podcasts, and a marketing dashboard product I use every day, I learned about from a podcast. And I am willing to bet that the marketers of the dashboard probably have that win misattributed to Google, as I listened to the podcast and googled their name.

Because of this attribution trickiness, and with the words of John Wannamaker painfully tattooed onto the arm of every marketer, “half of the money I spend on advertising is wasted” – brand marketing, predominantly what any media advertising is, has become a bold move, almost a dirty word.

Yet, everything in marketing just goes better when you have a strong brand.

But investing in brand is seemingly afforded only by the big dogs in any category, the guys that can hang an enormous poster over the luggage carousel at Heathrow or JFK, and not for the rest of us. But I think this is where the opportunity lies for podcast advertising, especially, unlike the posters at Heathrow, you can be very targeted, as the podcasts themselves need to be niche to attract their audience, and it’s relatively inexpensive compared to other media.

Five Reasons

So, I thought I’d dig into the data, which might help your business case when the boss looks up from the spreadsheets, and I came up with five reasons why podcast advertising is effective (and if you listen to my podcast, I always share 5 f’in’ things!).

1. They are listening, not just hearing

It’s not just Edison sharing the good news about the power of podcasts in a brand marketing media mix.

According to a Nielsen study in 2023, consumers are not just hearing ads; they are listening, as podcast ads yield great results regarding brand recall.

The Nielsen 2023 study shares a brand recall rate of 71% for podcast ads. To put this into perspective, similar research from Thinkbox on TV advertising yielded an average ad recall of 32.5%. I suspect this is due to the intimate nature of audio podcasts.

Back to Edison, who, in research with Acast in 2024, found that nearly 60% of listeners to podcast ads thought more favorably about the brand, and 44% made a purchase.

2. It builds trust

My mantra when it comes to the goal of B2B marketing is to create ART – Awareness, Revenue, and Trust.

Clearly, podcast advertising delivers on awareness, but back to Nielsen, in their Podcasting Today 2023 report they found that podcast listeners are twice as likely to trust a product recommended by a podcast host over one promoted by a social media influencer, the supposedly cool kids of what Nielsen describes as “emerging media”.

If you dig into this research, the key here seems to be host-read ads, which, as a podcaster I like to do, and so do many of my chums on the Marketing Podcast Network. The research refers to these ads as “like getting a recommendation from a friend” and so it seems not all ads are created equal, and if you are considering podcast advertising, try to secure host-read ads.

3. The ads do convert

Despite framing this as a brand marketing play at the beginning of this post, as I dig into the data, I found that podcast campaigns are not just about brand awareness; they do convert.

According to Podsight (now Spotify Ad Analytics) and their Q4 2023 Benchmark Report, the average podcast ad conversion rate is 1.3%, substantially higher than banner ads at around 0.35%, (sorry I don’t have the data for giant posters above luggage carousels) and of those that are exposed to an ad during a podcast and then visit the advertiser’s websites, 1 in 5 of them convert.

4. It works in the mix

As brand marketers know, you need to be where your consumers are, and these programs are typically multi-channel.

And podcasts are far from a siloed medium, as this 2024 article from Inside Audio Marketing reports, they play well with others. Media buyers are increasingly layering podcasts alongside TV, digital audio, and social, using them as a “connective tissue” that reinforces messages across platforms.

The article also shares, quoting Nielsen, that coordinated messaging across podcasts, social media, and TV drove a 3.5-times lift in brand awareness. And brands like State Farm cite podcast ads as effective in boosting engagement and message retention across other media, as the podcast ads help amplify the ROI of other channels, thanks to their trust-based, low-clutter environment.

5. Less clutter

I referred to a “low-clutter environment” there, as a study last year by Acast found that there is much lower ad fatigue among podcast listeners, as 76% of podcast listeners perceive fewer ads on podcasts compared to other media channels.

The keyword there is “perceive” as this study is supported by research from Sounds Profitable’s 2024 “Ad Nauseam” study, which revealed that nearly 50% of podcast listeners enjoy or don’t mind the ads, and 80% listen to all or most ads in a podcast episode.

So, not only is there less competition for ad attention, but it seems that podcast listeners give their attention to ads and are alright with that.

Give it a go?

There are ways to mitigate the measurement challenge, with calls to action, promo codes, using specific links, measuring product uplift, and if you have the resources, brand studies, surveys, and even something as simple as adding to your inbound forms a field that says “where did you hear about us”.

And it’s clear from this deep dive into this research that podcast advertising isn’t niche anymore. It’s a highly credible, performance-proven channel that builds trust and drives conversions, especially if you hook into a broader media plan.

So, if you’re looking for a way to cut through the digital noise, it’s time to speak directly into your customer’s ear, as the Sounds Profitable research described it, like a recommendation from a friend.

The Numbers

The TLDR (Too Long, Didn’t Read) is the numbers, and here are some highlights:

67% of the US population has listened to a podcast.
43% of 12-34 year olds are tuning in weekly.
56% of monthly podcast listeners have an annual household income of over $75k, and half of all podcast listeners are college educated.
A brand recall rate of 71% for podcast ads, and 60% of listeners to podcast ads thought more favorably about the brand.
The average podcast ad conversion rate is 1.3%, substantially higher than that of other forms of digital advertising, like banner ads.

Sources:

Editor’s Note: Ian Truscott is the host of Rockstar CMO FM on the Marketing Podcast Network and is a four-time CMO in the B2B and technology sectors.