Sponsored by Spotify Advertising • May 23, 2024 •
Jenny Haggard, global thought leadership lead, Spotify Advertising
The prevailing sentiment in marketing is the shorter the content, the better. In an attention economy, capturing people’s eyes and ears is challenging, so advertisers tend to believe that keeping content brief — no matter the message — promises more views, streams and engagement.
However, one proven exception to this rule is compelling advertisers to think again: podcasts. Research shows that people spend over seven hours per week consuming podcast content and that Gen Zers, specifically, achieve an average completion rate of 80% on podcast episodes lasting over 50 minutes. Ad spend is catching up with this cultural behavior: In 2024, podcasts will surpass $2 billion in ad revenue for the first time, and by 2028, that number will top $3 billion.
Despite this massive growth, some advertisers still question the format: How does targeting work? What kind of measurement and attribution is possible? What shows or categories are best for driving impact?
To help advertisers obtain the answers, Spotify Advertising launched its 2024 Podcast Trends Tour, an annual report detailing the latest trends and solutions in podcasting. These emerging behaviors — from how Gen Z interacts with content to how video plays an increasingly significant role in this ecosystem — can help inform a podcast advertising strategy and demystify the medium.
The age of social media influencers is rapidly shifting into the rise of multi-channel creators who want to create lasting connections with their fans. Podcast hosts, in particular, build deep trust with their audience, and they’ve become highly influential in purchasing decisions.
Spotify data found that 63% of people surveyed said they trust their favorite podcast host more than their favorite social media influencer. This creates a halo effect for brands: 93% of content engagement on Spotify translates into ad engagement.
Stream to screen: Podcasts aren’t just audio; there are video options, too
Podcasts aren’t just for listening anymore. Globally, on Spotify, there’s been a 39% increase in average daily streams of video podcasts, giving consumers the choice to watch or listen to content. Plus, depending on the moment, the platform sees people alternating between video or audio-only podcasts.
After STEM-focused schooling, Gen Zers in the U.S. seem to be feeling artsy: They increased their streams in the arts category (content related to art, drawing, film, theater, anime and more) by 23% YoY — a trend unique to this demographic. This is the same generation that experienced art budgets being cut in school and has a growing interest in creative fields like media, entertainment and the creator economy.
Proven results: Podcast ads are effective, leading listeners to take action
Podcast ads have grown in popularity to become a proven, effective format that drives business results. Sixty-two percent of study respondents took some sort of action after hearing an ad during a podcast show, like searching for the product, purchasing the product or simply talking about it.
Breaking borders: Younger audiences are using podcasts to learn about other countries and cultures
Younger generations are also using podcasts to expand their horizons. In the U.S., 47% of podcast streams by users aged 18–24 and 45% of podcast streams by users aged 13–17 were from shows that originated in a country outside of the U.S.
Out-of-country listening is highest for shows originating in English-speaking markets like the United States and Australia. Meanwhile, locals listen to content from countries such as Brazil and Japan, primarily because of their native languages.
Sound investments: As Gen Zers aspire to become influencers, they’re leveraging podcasts to learn and grow
Research shows that Gen Z’s top career aspiration is to be an influencer. As more Gen Zers explore building their own businesses and brands, they’re turning to podcasts to learn how to do it. In the U.S., business and technology is one of Gen Z’s fastest-growing categories, increasing 42% YoY, according to Spotify data. Advertisers should consider how they can help this generation achieve their dreams, reaching them when they’re in a growth mindset.
While marketers have become comfortable engaging in creator content and partnering with influencers, there remains a huge opportunity to leverage the influential power of podcast hosts. As advertisers seek to capture the attention of Gen Z, podcasts are a lucrative option, as many in this generation are using this format to learn, grow and connect with their favorite creators.
Additionally, podcast listeners act after hearing an ad because they trust the hosts and value what they say. Advertisers have numerous ways to utilize podcast advertising to drive true impact throughout their business; not engaging with the medium means missing out on a channel with massive growth and a significant, loyal following.
Sponsored by Spotify Advertising
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