Podcasts booming, are brands listening?

Over the last two decades, podcasts have significantly evolved in the B2B marketing mix. Besides investing in other marketing and advertising mediums, brands are largely investing in the podcast industry to boost their overall engagement, traffic and conversion ratio. According to the recent market analysis report, the global podcasting market size was valued at $11.46 billion in 2020 and is anticipated to expand at a compound annual growth rate (CAGR) of 31.1% from 2021 to 2028. As per the reports, the podcast industry has drastically evolved after the pandemic; work from the home system has driven the demand for easily available entertainment content. 

Furthermore, to cater to the wider audience demands, which are segregated on linguistic grounds, brands have started creating content in different languages. While exploring more on how brands are using podcasts as their marketing mix, we found the major key players operating in the global podcasting market, which includes Apple, Amazon, Soundcloud Limited, Spotify AB, Audacity and many more. Besides jotting down the numbers, we also took insights from the marketing industry on how experts define the podcast industry in 2023, how brands invest in the podcast, how new features of podcast help in boosting the brand’s business and much more. 

Podcast industry in 2023 

Talking more specifically in the context of the podcast industry, Krishna Iyer, Director of Marketing - MullenLowe Lintas Group said that experts predict continued growth driven by the popularity of audio content. With podcast, advertising revenue is expected to exceed $2 billion in 2023 and potentially double by 2024. Though new podcast creation has dropped by 80% from 2020 to 2022, listenership is increasing. India ranks third in the industry, with an estimated 150 million audio-streaming consumers offering a growth opportunity for podcasts.”

Further mentioning more figures on the podcast industry, Rajeev Pandey, Director, of Global University Systems, said, “India's podcast audience is growing rapidly, with a 57% increase in monthly active podcast users from 2020 to 2021, according to a report by KPMG. The report also found that the most popular genres for Indian podcast listeners are comedy, business and finance, and news and current affairs.”

Talking more from the global perspective, Sunil Kumaran, COO, of BIG FM, said, “Globally, India is the third largest market of podcast listeners after USA and China. It is predicted that in 2023, there will be around 464M podcast listeners and the podcasting industry will be worth approximately $4B by the end of 2023. These numbers signify a promising future for the podcast as a medium that is at the cusp of a revolutionary boom.”

Targeting Podcasts for brand promotion 

Briefing on how brands differentiate within the podcasts to invest as per the market requirements, Ravi Kumar, CEO, of Madhawks, Said, “Differentiation as a brand podcast occurs on two levels: brand category and ad objective. The type of podcasts they are likely to target is defined by a brand category such as FMCG, sports, insurance, construction, education, and so on. Ad objectives can broaden the portfolio's options to include generic popular channels such as comedy, news analysis, and so on.” Pravin Shiriyannavar, COO, of brand-comm, a unit of Madison World further added and said, “We recommend brands to choose from among podcasts based on the target audience, brand fit, the ability to measure the impact, and how creatively they can be integrated and executed to be another factor that needs to consider.”

Brands using podcasts features

Further describing how brands and advertisers use podcast features like - Promo Codes, Branded URLs, and Checkout Surveys to enhance their businesses, Krishna Iyer, said, “Several Indian brands and advertisers have effectively utilized podcast features, including promo codes, branded URLs, and checkout surveys, to enhance their businesses. Swiggy, IVM Podcasts, The Musafir Stories, and Paisa Vaisa have partnered with popular podcasters to create branded content, offer discounts to their listeners, and promote their products and services. Finfluencers like Akshat Srivastava use Screener to share insights into specific subjects like investment opportunities and coupon codes for its subscription to initiate trials. BigBasket also leverages checkout surveys to improve customer experience and tailor their marketing strategies to meet the needs of its target audience.” 

Talking more in terms of numbers, Kumar mentioned: "Podcast ads have an average conversion rate of 1.10% for site visits, 0.045% for purchases, and 0.08% for lead conversions such as email capture or signup. Podcast ads have a 0.15% app installation rate. More than conversion rates for various features; podcasts provide a serious and concentrated audience of early adopters. A combination of brands enjoys engaging.”

Comparing Podcasts with Television and Radio 

Discussing all the mediums of promotions, Iyer, said, “Podcasts are typically consumed on-demand, allowing listeners to choose when and where they listen, while TV and radio require viewers or listeners to tune in at a specific time. A recent survey by IVM Podcasts suggests that 56% of podcast listeners trust brands advertised on podcasts, and 73% listen to Indian-language podcasts. These shifts have led advertisers to reallocate their advertising dollars from traditional to digital media, including podcasts.”

Kumaran further mentioned the report on how India's music, radio, and podcast market is projected to expand revenue of nearly $1.7 Bn in 2024 as per the Global Entertainment and Media Outlook 2020-2024, PwC report. Elaborating more on how radio uses podcasts, Nisha, said, “Unlike traditional broadcast media, consumers can listen to podcasts at any time of the day. As a brand, Red FM produces unique content tailored to a diverse range of consumers. Our commitment is to create quality content, regardless of the platform or medium it will be consumed on.”

Podcasts versus Marketing Influencers 

Mentioning why brands prefer podcasts over other marketing influencers, Ayush Wadhwa, Founder and CEO, of OWLED, said, “Podcasts have somehow gotten a very loyalist approach with the audience, which is great for the brands and it also offers a more intimate and personal experience for listeners, creating a deeper connection between the host and the audience.” Adding to Wadhwa, Pandey, said, “Podcasts ads are often integrated into the show itself, so they feel like a natural part of the content. This makes listeners more likely to engage with the ad and less likely to tune it out. Finally, podcast advertising offers a level of measurement and accountability that is not always possible with other influencers. We can track metrics such as downloads, listens, and conversions to gauge the effectiveness of our campaigns. This level of data allows us to make more informed decisions about where to allocate our marketing budgets.”

Further focusing on the niche podcasts, Nisha Narayanan, COO & Director, RED FM & Magic FM, said, “Niche podcasts tend to have higher levels of loyalty and acceptance among their small audience segments. Conversely, mass content may not be as easily monetized. Two instances of this are ‘Rainbow Diaries,’ which discusses LGBTQ+ issues, and ‘Scholar Bhawa,’ a podcast that Reliance sponsored and which focuses on human rights.”

Advertising spend on the podcast industry in 2023 

The Survey by Pod sights in 2021 demonstrates that the average ROAS for a podcast ad was $2.42 – putting podcasting within reach of the 2:1 ratio many marketers expect from their digital advertising spend. Based on the data, experts shared their predictions for 2023, Iyer, Said, “It is hard to predict whether there will be a significant increase in podcast advertising spending in 2023. Economic conditions, industry trends, and changes in the consumer behaviour can alter advertising budgets and investment decisions. So even though the future of podcast advertising outlays will depend on various factors, its promising potential suggests that it's a marketing channel worth considering.”

Furthermore, Pandey mentioned that the IAB projecting that podcast advertising revenue will reach $1 billion by 2021. In conclusion, podcast advertising offers a unique set of benefits for marketers looking to optimize their advertising spend. With a strong ROAS and growing revenue, we will likely see an increase in the advertising spend on podcasts in 2023 and beyond.