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Even though it’s a relatively new marketing strategy, podcast advertising is an extremely lucrative option for businesses.
In fact, podcast spending has increased at an annual rate of 19 percent in the U.S. (or six percentage points faster than other digital ad spending growth rates)—and an astonishing 60 percent in Europe.
Obviously, podcast advertisements are also a great area of potential growth for podcast hosts who are interested in monetizing their podcasts. That’s why in this post, we’ll explain everything you need to know about podcast ads and how to get started using them (whether you’re a brand or a podcast host).
What Are Podcast Ads?
Podcast ads are the promotional breaks in podcast content where the host reads an advertisement for a brand—or, in some cases, the ad is a pre-recorded message inserted into the audio. The brand being advertised pays the podcaster to promote their product or service on the show.
A podcast ad usually contains information about the product or service, along with any personal experiences the host has had with the product. The ad may also contain promo codes or discounts that the listener can use to get a deal when they try the product or service.
What Are the Different Formats of Podcast Ads?
Podcast advertising generally takes one of two forms: host-voiced and fully-produced.
Host-Voiced Podcast Ads
These ads are read aloud by the podcast host. They’re the most common in podcasts, which is understandable; podcast consumers prefer host-read ads because they see them as more authentic than a generic ad read by a stranger’s voice.
Fully-Produced Podcast Ads
These advertisements are more like the traditional ads you’d hear on the radio—they’re recorded by professionals rather than the podcast host. Then, the professionally produced advertisement is inserted into the podcast audio during post-production.
Types of Podcast Ad Insertions
There are three main types of podcast ads:
- Pre-roll ads,
- Mid-roll ads, and
- Post-roll ads.
We’ll take a closer look at each one below.
Pre-Roll
Pre-roll ads are inserted into the beginning of the show, usually either before or after the intro. They typically run 15-30 seconds long.
Mid-Roll
Mid-roll ads, as you might expect from their name, take place in the middle of a podcast episode. These ads are the longest, running between 30 and 90 seconds on average. They’re also the least skippable ads, since they fall directly in the middle of the podcast content.
Thus, mid-roll ads tend to be worth the most money to a sponsor.
Post-Roll
Post-roll ads are played at the end of an episode, usually right before or right after the outro. Like pre-roll ads, they typically run between 15 and 30 seconds.
Is Podcast Advertising Effective?
In a word, yes!
In fact, podcast advertising has statistically shown to generate more than 4 times better brand recall in consumers than display ads. In a Nielsen survey, 70% of respondents reported that a podcast ad increased their awareness of a new product or service.
Less Skipping Means Better Storytelling
Part of the reason podcast advertisements can be so effective is the nature of podcasts. As the host, your voice is literally in the listener’s ear. If your listeners are subscribing to your podcast, that means they like you and your style—which means that on some level, they trust you.
Also, while listeners can technically skip through the ad, it’s not likely. According to an Edison Research and NPR study, 65% of podcast listeners report not skipping through the commercial. This means that as the host, you have more opportunities to create a memorable ad experience and trust that your audience will actually hear it.
Who Can Benefit from Podcast Advertising?
Podcast ads can have a mutual advantage, for both the brands ordering them and the podcast hosts reading them. We’ll take a look at both sides below.
Podcast Ads for Brands
For companies looking to promote their product or service, they could do much worse than podcasts. Companies can choose to sponsor podcasts in a category that aligns with their brand and direct their ads towards specific demographics. This specificity means that the companies’ ROI is likely to be much higher with podcast advertising than with a more generalized TV or radio ad campaign that reaches general audiences.
And because podcast listeners tend to stay more engaged, podcast ads can generate higher brand awareness than almost all forms of advertising, only surpassed by TV, digital video, and paid social.
Podcast Ads for Podcasters
Podcast creators see benefits from landing sponsorships as well. Paid ads can turn a podcasting hobby into a job, paying a podcaster to do what they love, potentially full-time.
Some of the most successful podcasts can earn tens of thousands in advertising revenue per month!
Of course, these wild success stories are in the minority; a more reasonable expectation for a mid-sized, sponsored podcast with 5,000-10,000 downloads per episode is somewhere in the range of $1,000 to $6,000 in ad revenue per month. But the more downloads your podcast gets, the more well-paid you’ll be!
How to Purchase Podcast Ad Space (for Companies and Brands)
If you’re a brand looking to expand into the podcast advertising space, there are a few ways to connect with podcasters. Let’s look at the three most common ways below.
Reach Out to Individual Podcasts
One way to buy ad space is to contact the podcasts you want to advertise on directly. This method can be more labor-intensive on your part, since you’ll be running the entire campaign yourself.
However, choosing an individual podcaster can give you more control over the process. You can work directly with the podcaster to negotiate pricing and manage the content of your ad spots.
Since individual podcasters likely won’t be using dynamic ad insertion or targeted ad placement, going this route means your only option is likely to be host-read ads. Of course, since host-read ads go over better with listeners, this situation isn’t necessarily a bad one.
Work with a Podcast Ad Network
If you’re a larger brand or have a big ad campaign in mind, it might be better to work with a podcast ad network. These networks may cost an added fee, but they do the legwork of searching out and locating the right podcast(s) for your needs.
They can also utilize dynamic ad insertion, which lets brands have direct control over their ads. You can create an ad to fit your needs and update or tweak it as needed.
Some of the most popular podcast ad networks include:
- Archer Avenue
- AdvertiseCast
- Authentic Shows (formerly Podtrac ad services)
- Midroll
- PodcastOne
- PodGrid
Start a Campaign with Platforms Like Podcorn
Much like ad networks, Podcorn connects podcasters to brands. However, Podcorn is a marketplace, not a traditional ad network, which comes with a couple of distinct differences.
Podcorn has no upfront fees, for one thing. The platform also only deals in native advertising and host-read ads—in other words, dynamic ad insertion and fully-produced ads are not an option.
Tips for Running a Successful Ad Campaign
To get the most out of your advertising campaign, you’ll need to do a few things right from the start. Know how much money you’re willing to invest, create a clear and targeted message, and work closely with the host to deliver an authentic and compelling endorsement. Then, find ways to analyze your ad’s performance over time.
Set Investment Amount
Before deciding on a budget, it’s probably helpful to know how much podcast ads typically cost.
Most podcasters and podcast networks use the same formula to calculate the price for an ad. Usually, the cost of sponsoring one episode is calculated at a “cost per mille” (CPM) rate, or in other words, the cost per 1,000 listeners.
According to AdvertiseCast, standard podcast advertising rates range from $18-$25 CPM, depending on the length of the ad and the popularity of the podcast.
So for example, if a podcast that charges $20 CPM normally has 10,000 listeners per episode, the cost of sponsoring one ad would be $200.
So knowing the average rates of sponsoring an ad, what’s your budget range? Run that number through a CPM calculator like the one at AdvertiseCast to determine and evaluate your campaign’s ROI.
Build a Clear Message Targeted to Your Demographic
The most successful ads clearly demonstrate the value your product or service provides to your customers.
To do that, you should first have a deep understanding of your target audience. Make sure you’ve built an audience persona that you can reference when deciding which podcast niche to target.
Once you have your audience demographics in mind, craft a compelling message focused on showing how your product or service solves a specific problem (or fills a particular need) that they have.
Let Hosts Demo Your Product before Publishing the Ad
If you’re using host-read ads, it’s crucial to let them get first-hand experience of your product or service.
One of the most powerful things about podcast ads is that the host gives a personal recommendation to their listener, who has built up trust in the podcast host. So if the host has personal experience with your product, they’ll be able to tell an authentic story about it—which will lead to better results.
Test Ad Performance Over Time—Rate of Conversion
Tracking the effectiveness of a podcast ad is critical, since it helps you determine what’s working and what isn’t.
Perhaps the simplest method of tracking individual ad performance is to send listeners to a unique landing page reserved only for podcast leads, then track the traffic to that page.
Or, if you want more granular metrics, you could give each podcast their own promo code or discount code. By using a podcast-specific code, you’ll be able to see which podcast ad resulted in a conversion.
Another option is to use a question like “How did you hear about us?” at some point in the purchase process or registration form. Whichever you choose, these methods will help you determine which podcast ads are generating sales—and which aren’t.
How to Sell Ad Space (for Podcasters)
For podcasters looking to land a podcast sponsorship deal, the name of the game is audience size. If you have a large enough subscriber count, you’ll be more attractive to brands—which makes sense, since they won’t be willing to invest money in your show unless enough people will hear their ads to make the brand’s investment worthwhile.
Once you’ve built up a decent following, the best way to sell ad space is either to work directly with brands, or to sign up with a podcast network. We’ll cover each method below.
1. Sign Up with a Podcast Network
For newer podcasters, the idea of approaching and negotiating with brands directly can be intimidating and overwhelming. If that sounds like you, you may want to join a podcast network.
Podcast networks, such as Midroll, AdvertiseCast, and PodcastOne, are the middlemen that help brands find podcasters to advertise with.
By joining a network, you’ll be exposed to more companies and it will be easier to be approached with sponsorship opportunities. Of course, this advantage comes with a cost; most networks charge fees upwards of 30% of your earnings.
2. Work Directly with Brands
Another option is to pitch companies directly. To find the right brands to pitch, do a little digging. You can:
- Check other podcasts in your niche: What brands are already advertising on these shows?
- Consider your audience: What kinds of products or services are they likely interested in?
Make a list of likely brands that may seem like a good fit based on these criteria. Pitch these brands using a sponsorship proposal highlighting the value your show could bring to the company.
If you need a good example to get you started with your email proposal, check out our free pitch template in our post: How to Get Podcast Sponsorships.
3 Things to Know Before You Get Podcast Sponsors for Your Podcast
Before searching out sponsors, it’s probably a good idea to have a solid understanding of your show and its data. Be sure you know the answers to the following three questions:
What are Your Audience's Demographics?
First, what kind of people listen to your show? Try to find similarities in your audience makeup, whether that’s age, gender, occupation, hobby, or something else! You can usually learn a lot about your show’s demographics by checking your podcast host’s user analytics.
What’s Your Advertising Rate?
Next, determine which rate you’ll charge brands to advertise on your show. Factors like your follower count and how well-established you are will probably determine how much you can realistically ask companies to pay.
How Many Ads (and What Type) Will You Offer?
You’ll also need to decide how many ads you’re willing to include in each episode. Ads can be pre-roll, mid-roll, and post-roll—and some podcasters run two or three ads back-to-back in each of these time slots.
But beware of cramming in too many ads per show; listeners may be turned off if your podcast feels too salesy, so weigh engagement rates against potential podcast ad revenue. We recommend that you don’t let advertising content go above 5% of your show’s runtime.
Podcast Advertising FAQ
How Long Are Podcast Ads?
Depending on whether they’re pre-roll, mid-roll, or post-roll, podcast ads generally run between 15 and 60 seconds each.
What’s the Right Cadence / Frequency for Podcast Advertising?
According to Ilyas Frenkel, the former manager of Growth at Squarespace, the best frequency for testing advertising success with a podcast is about once a week per show.
You’ll be able to tell which shows saw the greatest results in a timeframe of 8-12 weeks, and then narrow your focus to the best-performing podcasts after that.
What Are the Demographics of Podcast Listeners in the U.S.?
The average podcast listener in the United States is a middle-class white man with a college degree. According to Podcast Insights, statistics show that for Americans:
- 51% of podcast listeners are male
- 45% of monthly podcast listeners have a household income over $75K
- 27% of U.S. podcast listeners have a 4-year college degree
- 63% of podcast listeners are white
Who Advertises on Podcasts?
While podcast advertising has the potential to benefit a diverse array of companies, some industries are currently the leaders in podcast ad investment.
According to MediaRadar, Media & Entertainment, Financial, and Tech companies make up more than half of the total podcast advertising spend. Next on the list are Retail, Professional Service, and Apparel companies.
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Succeeding with Podcast Ads in 2023
Podcast advertising is a relatively new marketing channel, but it has the potential to be extremely lucrative.
Due to the nature of the medium, podcasters develop a real and authentic bond of trust with their listeners—meaning those listeners are that much more likely to trust their brand endorsements. And by selling podcast ads, podcast creators can get paid to do what they love: create high-quality audio and video content!
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