Podcasting is Growing: What Does that Mean for Advertisers?
Podcasting has rapidly grown in popularity and advertising investment, with U.S. consumer awareness rising from 22% in 2006 to 78% recently, leading advertisers—especially in tech, finance, and services—to increase spending by up to 43% in 2021, making podcast ads a highly engaging, less intrusive medium that brands are prioritizing for targeted media planning in 2022.
Consumers are changing how they interact with media—what does that mean for advertisers, and how are they responding? Podcasting is still one of the youngest forms of media, but it’s proving to be a strong advertising investment.
The number of podcasts is growing quickly. In 2006, only 22 percent of the adult population in the United States knew of podcasting. Last year, that number climbed to 78 percent. Listeners with any niche hobby or learning interest can find something to enjoy, which is great news for advertisers. This translates to a higher engagement rate, more loyalty between the listener and the podcast host, and a less intrusive way to get a brand’s message across.
MediaRadar has been tracking podcasting advertising data since 2020. Here are insights on the state of podcast advertising going into 2022:
- The top podcast advertising categories over the last two years
- How the top categories have changed since 2020
- The top ten spending podcast advertisers
- Podcast ad location and duration trends
- Shifts expected in 2022
Podcasting is becoming more of a priority for brands. See how your potential clients and their competitors could be investing in podcasting and use these insights to guide your media planning in 2022.
Top Podcasting Advertising Trends
As the number of active podcasts and listeners increases, ad numbers surge. Advertisers spent nearly $590 million on the format last year, a 21% increase from the year before.
Even as spending grows, the top spending categories remain stable. The only slight shift was between Media and Tech. Tech advertisers spent 23% more in 2021 than in 2020, moving into the top spending category position. Finance advertisers increased their spending more than any other category—by 43%. Services also jumped a noticeable 33%.
Pharma and Retail categories both jumped up by 30%, but their spending is much less than other top categories. The only major spending category to see a significant drop was Beauty, which decreased by 28%.
In 2021, the top categories made up 83% of total 2021 ad buys. The remaining 17% of advertising dollars came from smaller categories.
Top podcast advertisers in 2021
The following top ten companies accounted for 15.9% of the overall 2021 spending:
- Teladoc Health (BetterHelp)
- Berkshire Hathaway (GEICO)
- Capital One
- ZipRecruiter
- SimpliSafe
- Comcast
- Amazon
- Squarespace
- Coors
- Progressive
Podcast advertising appears effective. Once brands become podcast advertisers, they tend to stay with the format. 79% of podcast advertisers from 2020 continued buying in the format in 2021. The top spenders were some of the most steady advertisers, as seen in Q4 data.
How are podcasts inserting ads into their episodes?
When purchasing ads, it’s useful to know how competitors behave. Data shows which placements are most common:
- 26% of ads are pre-roll
- 55% of ads are mid-roll
- 19% of ads are post-roll
The bulk of ads (42%) are 30 seconds in length. Most are placed in the middle of the podcast or at the beginning, when they’re less likely to be skipped.
Quarterly Podcast Spend 2020-2021
In 2021, most of the growth in spending took place in the middle of the year. This year-over-year growth seems related to a mixture of depressed COVID-related spending and a better overall year in 2021. Spending in 2021 was rather stable from Q2 onward.
The largest year-over-year increase took place in Q2 2021 and Q3 2021. By Q2 2021, podcast spending had significantly climbed past spending during pre-COVID times.
Even though big spenders are steady and faithful advertisers, much of this increased spend actually came from a surge in new, smaller brands.
Using Q4 to Shed Light on 2022 Podcast Advertising
Podcast advertising seems to be in a steady state. There were only minor differences between Q4 and the previous time periods in 2021.
Nearly $160 million was spent in Q4 2021. If trends remain similar to those of the last three quarters, similar spending is expected in Q1 of 2022.
Top podcast advertisers in Q4 2021
The top ten podcast advertisers spent over $26 million in the last three months of the year. The top spending brands included:
- Teladoc Health
- Capital One
- Berkshire Hathaway (GEICO)
- SimpliSafe
- Comcast
- ZipRecruiter
- Amazon
- Squarespace
- Bank of America
- State Farm
The two differences between the top advertisers in Q4 and the previous quarters were the swapping out of Coors and Progressive for Bank of America and State Farm. Otherwise, the list features the same top spenders.
When it comes to category spending, the top categories looked very similar to earlier in the year. However, beauty continued on its downward spending trend and no longer made the top spending list. Public service advertisers contributed more to overall podcast advertising than beauty brands by the end of the year.
For more specifics, check out a brand’s spending profile
Podcast ad spending in the United States on average grows at 19% annually, six percentage points faster than the average digital audio ad expenditure growth rate.
As your brand or your clients seek to understand how you can incorporate podcasting into your media planning mix, check out the advertising profiles of other businesses. By dialing in on competitor spending, you can assess how much you need to invest in order to earn more market share.
You can learn more about podcast advertising by downloading a trend report.
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