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GUEST COMMENT: Retail brands should stop underestimating podcasts

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GUEST COMMENT: Retail brands should stop underestimating podcasts

Chris Beer, Market Intelligence Manager, GWI
Chris Beer, Market Intelligence Manager, GWI

It’s now a year since lockdowns became a fact of life across the world. It’s easy to forget some of the predictions and observations that were made in the initial stages about what would thrive and what would suffer.

 

A common consensus early on was that with commuting wiped out almost overnight, podcasts would take a battering. And while Spotify’s earnings results from April last year did show an initial downturn in podcast consumption, they have recovered and are now doing very well.

 

It’s easy to make assumptions about changing habits under lockdowns, but ideas work better with solid insight behind them. Our research at GWI backs up Spotify’s figures, with the number of Spotify users listening to podcasts up by 5%.

 

They may have once been a niche activity, but 45% of the online population now listens to podcasts.

 

Spotify’s strategic acquisitions and new advertising tools show just what momentum there is in the market, even after a year of on-off lockdowns. It’s time to listen in to what podcast advertising has to offer.

 

Meet podcasts 2.0.

 

Knowing the potential reach of podcasts is one thing, but knowing their effectiveness and levels of trust is quite another.

 

Our research shows that 13% of podcast listeners discover brands through ads on shows they listen to, around the same number that discover brands through out-of-home advertising. Podcast ads have always benefited from being less interruptive, usually being read by the host and often woven into the topic at hand. That strength can now be supported by more robust tools in the back-end.

 

Spotify isn’t the only game in town, but the slew of new features for advertisers it has unveiled over the last few months signal where things are headed. Advertisers will start to see the benefits of targeting through platforms’ user data, and have much more detailed metrics about an ad’s success rate.

 

Podcast ads are now much more advanced than just a host reading a sponsor’s script. Until relatively recently it may have been difficult to know who was listening, how many people a spot reached, or how effectively it converted. But that is all set to change.

 

So who’s actually listening?

 

Different genres have different listeners, but on the whole, podcasts draw in an audience that would be squarely in most advertisers’ sights; young people with money to spend. They’re a pretty engaged bunch, too. The typical listener enjoys their favourite shows for an average of an hour and 17 minutes per day – around the length of one episode of WTF with Marc Maron, or two episodes of Internet Retailing’s very own podcast, RetailCraft.

 

While radio ads make the most impact with Gen X and baby boomers, podcasts and music-streaming services are the most effective audio ad channels for Gen Z and millennials. But it’s not just the age of the podcast audience that makes them alluring, it’s their willingness to put their hand in their pocket.

 

Podcast listeners are more likely to say they buy brands they see (or in this case, hear) advertised. Not to mention they’re also more likely to buy premium versions of products, to describe themselves as affluent, and to want the latest tech products.

 

All of which would be promising enough in its own right. But there’s something less tangible that podcasts take advantage of too – the power of the human voice.

 

It’s good to talk

 

In our Connecting the Dots report, which contains our predictions for the year, we highlighted how values of kindness, empathy, and understanding will be a necessity for brands in 2021. Everyone is looking forward to getting out of lockdowns, but the world’s collective mental state is still quite fragile, and will need nurturing.

 

Audio, by its very nature, is intimate. When listening to a podcast, the listener isn’t just consuming a piece of content – they feel like part of a conversation, part of a club. This kind of rapport between host and listeners makes it a great conduit for those much-needed values this year. Spotify’s new features will make an impact here too, as the platform is introducing polls and Q+A features that will keep listeners even more engaged.

 

Given the intimacy of podcasts, it’s little wonder that listeners really prize the idea of community. They’re 15% more likely to say contributing to their community is important to them, 39% more likely to say they buy products to be part of a community, and 26% more likely to want brands to run customer forums.

 

Podcast listener groups thrive on social media, where listeners can share fan art, or exchange their thoughts on the suspects in a true crime series.

 

The technology behind podcast ads is fast-improving, but brands getting on board have to respect what listeners value about them. You can’t blare out a bland, general message; you have to ensure you blend into the conversation. As ever in advertising – if you understand your audience, success will follow.

 

Podcasts will continue to thrive post-Covid.

 

They might not quite be the soundtrack of the commute any more, but podcasts are coming into their own as a form of media, and as an ad channel. Listenership has grown even amid lockdowns, and advertisers have more targeting options at their disposal than ever before.

 

They make listeners feel like part of something bigger, and have likely been a support mechanism for many during the Covid-19 pandemic.

 

As society readjusts during and after the Covid endgame, podcasts can offer advertisers a route to business growth, and a way to demonstrate brand purpose.

 

If there’s ever been a good time to know how people actually think and feel, it’s now.

 

Author:

 

Chris Beer, Market Intelligence Manager, GWI

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