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It’s Time to Meet the Programmatic Podcast Opportunity

According to Edison, consumers are listening to over four hours of audio per day across terrestrial radio, digital streaming, podcasts and satellite. While terrestrial radio continues to shrink, podcasts represent one of the largest areas of listener growth.

So why is podcast ad spending not keeping up? The podcast advertising industry has lived in a custom, host-read, show-level world for years. These executions are tried-and-true and work well for advertisers seeking alignment with specific hosts and big shows. If your brand loves Conan O’Brien, Oprah or Ashley Flowers, these executions make sense.

Similar to audio playlists, podcasts are a reflection of varied individual interests and who listeners are. Why then, should the industry only focus on the 50 biggest shows? Podcasts are a by-choice journey with nearly endless programming. For consumers, that’s a never-ending library of awesome content. For marketers, that size and scope is both a blessing and a curse.

But there are thousands of premium, interesting podcasts out there—some of which are too small to stoke advertiser demand at an individual level and are frankly too hard for publishers to sell as standalones. In aggregate, however, these shows (both big and small) make up a huge opportunity. And to those listening to them, all content is important and impactful to daily lives—regardless of who the host is or the size of their individual audiences.

Enter programmatic

Brands care deeply about a few important things: transparency, scale, premium content, brand suitability, measurement and appropriate creative. If an ecosystem can get those things right, chances are investment follows, and programmatic execution for podcasts can solve all these goals.

While terrestrial radio continues to shrink, podcasts represent one of the largest areas of listener growth.

To do so, marketers can learn a lot from streaming audio, which has become a well-worn path in a short period of time for programmatic buyers and sellers. Large streaming platforms, DSPs, agencies and marketers have built success by embracing premium, scalable music content, rich targeting, robust measurement and more broadly, the power of audio and its unique place in people’s lives.

The streaming music programmatic ecosystem has been private marketplace-driven, with communication between buyers and sellers on KPIs and targeting so that inventory can be curated to focus on the content and audiences that make sense. SXM Media’s goal, and the goal of other large podcast content owners, is to bring this same approach to the podcast space, which has historically been too fragmented for large brand advertisers to heavily invest in. 

Programmatic buying is great for podcasts

DSP tools expand and enhance network-level podcast campaigns through unique reach, cross-campaign management, targeting, transparent reporting and streamlined creative execution. Real-time, bidstream data highlighting IAB content category, show and episode gives the keys to the buyers and enables the measurement needed to prove out the efficacy of the platform. 

Taking an audience-based approach (which marketers are comfortable with for other mediums) unlocks scale across the spectrum of podcast listenership instead of being beholden to single shows. With a programmatic buy, podcast execution takes its rightful place alongside social, online video, CTV and streaming audio in one user interface (the DSP) that manages frequency and performance across mediums.

Through programmatic, the size and scope of an entire podcast network can be realized, with content and brand suitability guard rails to ensure comfort. Because of a transparent architecture, DSPs like The Trade Desk report on what you’re buying—down to an episode level.

This reporting feeds brand suitability measurement—as companies like Barometer use AI to comb through transcripts of episodes to assign them a grade. Those grades are matched to the DSP reporting output and advertisers are provided with a summary on where their ads ran and whether the content was brand suitable. This is the third-party validation that the industry needs to get comfortable. And it’s all in a clean and tidy user interface that buyers are already comfortable using. 

Opportunity awaits

Marketers have an opportunity to build a new programmatic market with podcasts—less than 5% of execution is happening this way today.

SXM Media and others have set out to build a transparent, brand-safe ecosystem with ample measurement and thoughtful creative execution while harnessing the power, targeting and efficiency DSPs can bring to the table. It’s time to scale podcast investment through thoughtful programmatic execution.