Blog

Podcast Advertising: The What, Why & How of Podcast Ads

Content

Podcast Advertising: The What, Why & How of Podcast Ads

Podcasts are more popular than ever before. Every month, 116 million Americans listen to podcasts. No wonder, then, that advertisers (big and small) want a piece of the podcast advertising action. If harnessed properly, podcasting can give advertisers access to a wide-ranging yet hyper-targeted audience, with a hugely positive ROI. 

That said, if you’re new to the world of podcasting, it can seem impenetrable. In this guide, we guide you through the what, why, and how of podcast ads so you can get started with confidence.

What is podcast advertising?

Podcast advertising is podcasting as a medium to promote a particular product, service, or business. 

This can be through podcast sponsorship, where businesses pay for their product, service, or business to be promoted during a podcast in the form of an advertisement. 

Or, businesses can create their own branded podcast show where the whole premise is to promote their business. Although the overall aim of this kind of show is to sell a product or service, branded podcasts also offer listeners value-rich content that helps to build brand reputation and credibility and raise brand awareness.

How effective is podcast advertising?

Nobody can deny that podcast advertising works. If you doubt the effectiveness of this type of audio advertising, just take a look at the numbers! 

According to the Edison Research Super Listeners 2021 report, podcast ads are the most recalled ad types. This was corroborated by 86% of respondents. This means that an overwhelming number of podcast listeners remember hearing an advertisement included in a podcast. 

Podcast advertising is not only memorable, though. It’s also effective in creating tangible engagement. In the same report, Super Listeners found that 76% of listeners act on podcast ads. 

In addition, distinct from ads on YouTube, 33% of respondents said that they ‘never or rarely’ skip podcast ads. This is excellent news for advertisers because this means maximum exposure and air time to a hyper-engaged audience. 

Why do podcast ads work?

The power of podcast ads comes down to the nature of the medium. Audio content is highly effective at conveying information and messages. In addition to the compelling statistics above, there are three other reasons podcast advertising is so effective: 

Firstly, podcasts have a broad reach. With more people than ever listening to podcasts, businesses can easily access a wide range of audience demographics. There is such a diverse range of shows that marketers are spoilt for choice in terms of the audience and niche they choose to target. 

Secondly, podcaster creators tend to build up a loyal following. This translates to trust. When you combine a highly-engaged audience with a credible host that they believe and respect, this is a winning formula for marketers and advertisers. Businesses can leverage podcast hosts’ influence to their advantage. 

Thirdly, podcasts boast a hyper-targeted, captive audience that has chosen to engage with their content. This makes for a winning marketing formula because businesses can address their ideal customer they know has some interest in their niche. 

How does podcast advertising work?

There are three podcast advertising categories: standard, affiliate, and branded podcasts. Let’s take a quick look at how each of these three works: 

Standard Advertising Agreement 

In this advertising deal, the business or sponsor pays the podcast host, production team, or company for ad space in their audio. The ad itself can be pre-recorded or host-read, and it can be fixed or dynamic (more on these terms later). Both parties will also agree on the ad’s placement within the audio content, which may affect the advertising rate. 

Affiliate Marketing

In an affiliate marketing structure, the podcaster decides to join the affiliate scheme and market the business or service in question. They only get paid when and if their promotion results in sales or conversions. 

Branded Podcast 

Some businesses prefer to invest fully in the podcasting world by creating their very own branded show. As we mentioned earlier, the overall goal of this type of podcast is to create engagement, raise brand awareness and ultimately, drive sales. Beyond this, however, this is also a great way to connect with your customers and community and offer them accurate value-rich content that relates to your brand. 

Ad-placement 

As we mentioned earlier, ad placement can affect the advertising rate. Generally speaking, there are three positions that an ad can be played in: 

Pre-Roll

This is an ad that is played before the main body of podcast content. 

Mid-Roll

Mid-roll ads are played during the episode or in the middle of the podcast. 

Post-Roll

Post-roll ads come after the episode has come to an end.

As you might imagine, the most valuable ad placement is mid-roll. Just like when watching a YouTube video, we’re all far more likely to skip over an ad before the podcast and completely ignore one at the end. For this reason, a mid-roll ad is expected to generate far more engagement (and far fewer skips), and therefore be priced at a higher rate. 

Types of cost models for podcast advertising 

Different podcast advertising rates depend on the cost model that you choose. Let's take a look at the most standard:

CPM 

CPM stands for ‘cost per mile.’ This is how ads that are placed pre, mid, or post-roll are usually priced. CPM refers to the price paid for every one thousand impressions or plays of the episode. The typical 30-second ad CPM is $18 and $25 for 60 seconds on an industry standard. 

This pricing structure is usually more appropriate for larger podcasts that regularly reach thousands of impressions each episode. 

Note that the way ‘impressions’ are quantified can vary, so clarify this when brokering an advertising deal. 

CPA 

CPA stands for ‘cost per acquisition.’ This is how an affiliate marketing model would be priced, for example. Under this cost model, the emphasis is on the number of conversions. Each time a listener converts due to the podcast ad, the business or sponsor pays out a pre-determined fee. 

Note that with this cost model, you will need a way to track conversions. You could use a unique coupon code or vanity URL, for example. 

Flat rate 

Some podcast advertising deals agree on a flat fee for promoting on the podcast. This approach is not that common, however. The contracting parties will negotiate the price and be affected by several factors, such as audience size. 

Types of Podcast Advertising Formats

Fully-Produced/ Hybrid Podcast Ads

Fully-produced podcast ads usually are recorded by the brand itself. This gives the brand complete control over the production quality, narrative, audio, tone, and more. Once they’re happy, they share the ad with the podcast, who then include it in their content in the way you’ve agreed. 

These ads are a more obvious interruption of the podcast’s flow because the voices and audio quality might differ. 

Host-Voiced Podcast Ads

Host-voiced or read podcast ads are where the podcast host takes a brief interlude from their episode to promote your product or service in their own words. As the sponsor, you may give them some critical points or details to mention, or even a script - but the essential and valuable point is that this endorsement is in the host’s own words. This is a great way to harness the reputation that the podcast host might wield and use it to your advantage. 

These kinds of ads are far less interruptive than others because it’s still the host speaking. Plus, these ads harness the credibility of the host giving the promotion added authenticity and believability.

Branded Podcasts

As opposed to self-contained ads within another person’s show, branded podcasts are where the whole show is related to a business, its sector, industry, and expertise. 

Note, this doesn’t mean that the entire podcast is one long sales pitch. Businesses often try and offer value-rich content to their target audience to build brand reputation and credibility. 

Discover examples of the best branded podcasts and what you could learn from them in our guide! 

Different ways podcast ads can be inserted 

Data-Driven or Dynamic Ad Insertion

Dynamic ad insertion (DAI) uses the power of podcast hosting platforms’ ad servers to match listeners to different ads. This is a far more tailored and highly targeted advertising strategy that leads to far better conversions than others. 

The other advantage of DAI is that you can ensure that the ads are up to date without affecting the original audio of the podcast itself. 

However, do bear in mind that these types of ads need to be pre-recorded, so will sound more like an interruption than a host-read ad would. 

Baked-in Ads 

These ads are recorded into the core audio file of the podcast episodes, so they’re an integral part of that recording. This means that every single listener will hear the same ads. 

How to buy ad space (for brands)

If you’re interested in buying some ad space, you may have no idea where to start. Here are some easy ways to get started: 

Through a media or ad agency 

If you’d rather avoid the hassle of negotiating and undertaking the exclusive advertising deal, you can opt to go through a media advertising agency. The agency will do all the hard work for you and help you acquire space within a podcast for your advertisement. 

In addition, if you’re interested in DAI, podcasting ad networks can orchestrate this for you to produce and promote with different ads consistently. This works exceptionally well for time-sensitive or seasonal promotions. 

The potential downfall of this approach is that you have less control over which podcasts you can access. 

Approach potential shows yourself 

If you’ve got more time on your hands, you can take a more direct approach. Although do be aware that this puts the onus on you for finding the perfect podcast to advertise with. Once you’ve done the research and identified a show you’d like to partner with, reach out to the host asking for their media kit and more information. You can then offer a sponsorship deal directly to the podcast host or producer.

Start an affiliate or commission scheme 

If your business is interested in podcast advertising but is risk-averse, starting an affiliate or commission-type model might work best for you. In this type of advertising deal, there’s no need for upfront investment. Instead, you’ll payout on a CPA (cost per action) model, whereby the podcast earns according to how many of their listeners’ follow through from the ad. 

How to sell ad space (for podcasters)

If you’re a podcaster looking to monetize your show, here’s how to sell some ad space: 

Approach brands directly 

If you’ve got your eyes on a specific business or brand with which you’d like to work, why not reach out to them directly. This approach is not always that effective, and you may receive some rejections before hitting the jackpot. The advantage, however, is that you maintain control over who you work with and what you advertise.  

Join a podcast ad network 

If you’re looking to sell ad space, but don’t know where to start, try signing up to a podcast ad network. They’ll help to match you with businesses looking to buy some ad space. 

Note: this approach is best for bigger, more-established podcasts with a big following. 

Join an affiliate scheme

There are plenty of affiliate schemes out there that you can sign up for right away. These are a quick and effective way to use ad space on your podcast, with relatively low pressure on whether your promotions are effective or not. 

Check out Amazon Associates or Audible’s affiliate program for examples. 

Tips for running a successful podcast advertising campaign

If you’re sold on the idea of advertising on podcasts, but you’re not sure how to ensure a successful campaign, follow these three tips: 

Understand podcast advertising 

If you’re going to launch a successful podcast advertising campaign, you first need to understand the medium, the space, and what works. This includes knowledge of the different types of ads, why ad placement is essential, the difference between baked-in and dynamically inserted ads, and the different cost models. 

Once you’re able to wrap your head around the different options, you’ll be able to make decisions appropriate to your campaign. 

Choose the right podcast(s)

If you invest time choosing the right podcast to advertise with, you’ve done half the work. Taking time to research podcasts that align with your brand and that already have your ideal customers’ attention will help maximize the success of your podcast ad campaign. 

Refine your budget 

Like most things, at the end of the day, podcast advertising comes down to money. You’ll need to have a good idea of your advertising budget and which type of cost model will suit you and your business best. 

Podcast advertising examples

Need some inspiration? Take a look at these examples of podcast advertising: 

Host-read ads for Peloton on I Don’t Know About That, True Crime Obsessed, Office Ladies, Court Junkie, and Chatty Broads with Bekah and Jess

Pre-roll host-read ad for Amazon Music and Uncommon Ground on This American Life

Dynamic ads on JaackMaate’s Happy Hour

Podcast Advertising FAQs

How do podcasts make money?

There are lots of different ways for podcasters to monetize their work. Advertising isn’t the only income avenue. You could offer paid podcast subscriptions, sell merchandise, and more. Check out our guide for a complete overview of your options! 

What are the biggest podcast networks?

There are a lot of podcast networks out there, but some of the biggest are Gimlet Media, Wondery, Radiotopia, Podcastone, and National Public Radio

Which advertisers are buying podcast ads?

Businesses are waking up to the marketing power of podcasts so that most big brands will be running a podcast advertising campaign. Some examples include Amazon Music, HSBC, Peloton, Door Dash, and Skillshare. 

How to start podcast advertising?

If you’re a brand looking to get into audio ads, follow one of our tips above - either approach a podcast directly, go through a podcast network or start an affiliate scheme. 

If you’re a creator looking to monetize, try reaching out to a brand directly, signing up for a podcast network, or joining an affiliate scheme! 

How much does podcast advertising cost?

Wondering how much it is to advertise on podcasts? Unfortunately, there’s no one-size-fits-all formula. However, you may be able to find some industry-standard rates for reference. The rate you pay will depend on your cost model, as well as what you manage to negotiate. If you go through a podcast network, you may have to pay a small proportion to them. 

How do you measure podcast advertising success?

Luckily, with podcast advertising, you have quantifiable metrics and insights by which you can measure the success of your campaign. By tracking the conversions and sales that arise from your ad, you can directly correlate success (or lack thereof) to your podcast ad. 

It’s easy to track direct sales from a specific ad by including a unique coupon code or URL. Indirect sales remain difficult to attribute.

Subscribe to our newsletter

Highly curated content, case studies, Riverside updates, and more.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Related articles

7

min read

Vodcast: Everything There Is To Know About Vodcasting

Riverside.fm is an audio-video tool that collapses the pod/broadcast studio experience into your browser. The service captures lossless audio and up to 4K video locally, syncs it, and uploads as you go.

10

min read

The Complete Guide to Podcasting For Business - Riverside.fm

Riverside.fm is an audio-video tool that collapses the pod/broadcast studio experience into your browser. The service captures lossless audio and up to 4K video locally, syncs it, and uploads as you go.

9

min read

B-Roll Guide: What Is It & Why, When, How To Use It

Riverside.fm is an audio-video tool that collapses the pod/broadcast studio experience into your browser. The service captures lossless audio and up to 4K video locally, syncs it, and uploads as you go.