Everywhere you look today, you see people wearing headphones. Walking around in the streets, working in offices, commuting on trains and planes. Smart speakers also abound, penetrating more and more households. These two technologies – coupled with Bluetooth and smartcars – have enabled the rise of audio consumption to levels not seen since before the television when people huddled around the radio to hear grainy old-timey voices talk about news and tell stories.

While many people are listening to music, a bigger and bigger chunk of them are also listening to podcasts. Podcasts have absolutely exploded in popularity over the past few years. Spurred primarily by humor, podcasts now cover nearly every viewpoint, every angle, and every subject. Apple, who represents about 60-70% of the podcast service market, reports having over 700,000 active podcasts in over 100 languages. 

Podcasts represent an alternative to traditional talk radio since they can be much more specific. They can be humorous, educational, inflammatory – you get the idea. In fact chances are you have listened to a podcast or two. Over 51% of adults in the US reported having listened to one, and that is growing quickly. Take a look at the proportion of world populations who have listened to a podcast in the past month:

And where there are ears, advertisers and brands are not far behind. But before we get into the opportunity that podcasts represent for brands, let’s understand how it works.

Two Types of Podcasting Technology

Podcasting is typically an audio format pre-recorded into a single file. This file is then hosted somewhere. For people to gain access to the podcast, they use one of two techniques. Streaming and progressive download.

Streaming is probably the most familiar, meaning that people access the content on a platform like Spotify and listen in realtime. Spotify is able to know how many people are listening at any given time. People can cache the podcast on their device and listen to it later without a connection. If people are streaming, the audio is not stored on the device. When they stop they can’t go back and listen to a different part if they have lost the connection.

Progressive download is exactly like what it sounds, it downloads as the user listens so a copy of the file ends up on the device when the person is done listening. Basically there are some technical differences here but what’s important is that with the progressive download only the hosting platform of the podcast knows the information about who listened to what.

The reason why I’m explaining these two differences is because it affects how advertising works in podcasting – and that’s why we’re really here isn’t it? In the streaming environment the streaming platform can add advertisements in by interrupting the stream. Advertisements can then change from day to day, hour to hour, or user to user. In progressive downloading the ad is “stuck” to the podcast so it can’t be changed out.

How Brands Can Leverage Podcasting

Now that we understand that there are a lot of people to reach and that there are a few ways to do it, we can tackle how. Most brands look at podcasting opportunities in three different ways: traditional ads, sponsorship, and brand content.

Traditional Advertising in Podcasting

The most common way for brands to engage with podcast audiences is buying space. Ads take the form of pre-rolls, mid-rolls, and post-rolls, a lot like YouTube but with audio. Generally speaking, the mid-roll is the most coveted position since the listener is highly engaged at this moment. The pre-roll comes second although some podcasting ad salespeople will tell you that the post-roll is better since someone is engaged all the way through – but they are definitely not sticking around because they want to hear your ad!

Podcasting ad salespeople will also tell you that you can’t just transform your radio creative to podcasting, that it should be more customized and less radio-ish. For example, if you are placing your ad in a podcast where there is mostly quiet discussion, having a jingle can be jarring. Even if that strategy helps you stand out in a noisy car radio environment, it wouldn’t perform well in podcasting.

Sponsoring Podcasts

Oftentimes podcasters have very loyal audiences who appreciate the work that the podcaster puts into creating their podcast. Independent podcasters deserve to be remunerated for their work, and so when a brand comes along that matches well with their podcast and their audience, sponsorship could be the best way to go. In this case the podcaster themself delivers a message from the brand, along with their personal recommendation (or not). This format is great because not only does an advertiser get a personalized message from a trusted source, it also fits into the flow of the podcast. It’s the same voice delivering the message. And with loyal fanbases, they will probably look positively at a brand that is helping their podcaster succeed. Win win!

The downside is that as a brand you can’t just buy ad space with a certain audience across multiple podcasts, you have to go one by one to different podcasters. This can be strenuous work that might not be worth it in the end. Podcasters can also choose to decline your offer if they don’t like you.

Brand Content Podcasts

Did you know that McDonald’s created a podcast? It was called The Sauce, and it outlined in a detective-style storytelling why the beloved Szechaun Sauce didn’t make it back to stores despite extremely popular demand. For the cult of fans that worshipped this sauce, McDonald’s found an extremely interesting format to engage them, while at the same time casting light at the difficulties of being a giant corporation. It resonates today because of how innovative it was. But it also drew a lot of extra attention to the fact that 20 million packets of Szechaun sauce were then available at McDonald’s locations across the country.

Creating your brand’s own podcast is another option to tap into this growing trend. Admittedly, there are some limitations. You can’t just create podcasts with people talking about how great your brand and products are. But taking McDonald’s as an example, a little creativity can go a long way. Branded podcasts can take the form of storytelling around how people use your products. It can highlight the backstory of your brand if the founders were interesting people (general rule, everyone is interesting, you just need to find the angle). It can talk about the best customer complaints – a humorous moment that gives you the opportunity to show how your brand responded, gaining valuable crediblity.

The options are endless. Podcasts are here to stay. How will your brand take advantage of this new opportunity?