Where's the money?
Wherever the audience goes, the money follows.For the industry at large, that means advertising dollars will continue to move away from traditional media into the Internet and other related mediums like podcasting--where audiences are growing, particularly with the under-35 demographic. According to Arbitron, 11 percent of Americans say they have listened to an audio podcast, 53 percent of them under the age of 35.
This is becoming very attractive to advertisers--but a key component that's been missing is effective audience measurement and targeting capabilities, enabling advertisers to properly assess the medium based on real performance.
Similar to the trajectory of Internet advertising, podcasting was somewhat rudimentary initially, yet it's been steadily winning over advertisers, with $315M or 1.5 percent of radio marketing dollars shifting online as the format gets more sophisticated. As a result, companies like Clear Channel are starting to offer time-shifted versions of their radio programs on the Internet to tap this new distribution. As these mainstream content providers adopt podcasting, they are likely to bring their existing advertisers with them.
How do you monetize?
Step one: Advertisers want to reach the right audience at the right time.Market segmentation is the key to getting the most value out of any CPM-based advertising. Getting real value out of podcasts means offering tangible metrics on who's listening, including information on the number of plays and downloads, accurate audience demographics and details on when people are listening.
Step two is the ability to target ads to a segment of your audience, without a lot of time or angst. For example, being able to insert an ad from a regional advertiser to all of your listeners in that region--or, only reach all of the women who listen. Turnkey podcasting ad networks can do this.
Step three is scale. Large media companies need to reach large numbers; networks can aggregate key demographic audiences for them.
Where are the listeners?
Listeners care about content and convenience--give them the content they care about, when and where they want it. Podcasting gives listeners the ultimate control--they can listen whenever and wherever they want. Podcasts become their personal media library delivered directly to them.
What will drive even more listeners to podcasting? Broad availability of premium content, such as "Desperate Housewives," ESPN, "American Idol," etc.--giving listeners content that's already in huge demand, on devices that are wildly popular. The availability of premium content is a growing trend.
So, how can advertisers get behind podcasts?
Many large radio and TV ad buyers, in addition to Internet advertisers, are already in podcasts. You can find messages from top brands such as Lexus, Acura, and Best Buy in podcasts today. Many popular podcast properties are sold out; the limited premium content available is going fast. Advertisers are currently paying on a per-podcast downloaded basis, which doesn't ensure that podcasts are actually listened to. Typically consumers download vastly more podcast content than they listen to, similar to the early days of the Web when advertisers were charged for metrics such as page hits. Advertisers will start to demand greater accountability because new technologies will provide real metrics, including very valuable information such as age/gender and where ads were heard.
Why should media buyers recommend it?
This is where listeners are! While podcasting is new and media buyers still lack experience with it, they will find it a fast-growing opportunity to effectively reach consumers. Media buyers should not be afraid to try podcasting--it offers the kind of value advertisers dream of.