Podcasters should embrace programmatic ad insertion

On the web, few companies are wiling to pay for advertisements that aren’t targeted to their ideal customer – or at the very least a customer in their target market. However, in podcasting, listener targeted ads haven’t been a thing.

After listening to podcasts almost every day for a decade, last month I finally heard an advertisement that wasn’t meant to be heard by someone an ocean away on another continent. Advertisement technology seems to finally be catching up to audio-content delivery.

I don’t live in the United States of America, but I listen to many English language podcasts. Most of these have been produced in the US, but a good portion is produced in the United Kingdom, and other still are produced elsewhere in the world. What they all have in common is that they’ve almost exclusively been running advertisements aimed at an American listenership.

I’ve heard more ads about American cellphone providers, online mattress stores, and clothing and food subscription services that only operate in the U.S. than any non-US citizen should in a lifetime. These ads run for months, and sometimes years, on repeat across multiple podcasts and networks.

In I heard the first ad read on a podcast that was specifically targeted at a non-US audience in a US-produced podcast. This was the first time I’ve ever heard this over the course of more than a decade of daily listening to podcasts. I decided to look into it a bit, and downloaded the same episode from a U.S. proxy server. When I got the episode this time, I heard a completely different advertisement for a U.S. based monthly subscription service. This was the first time I’ve ever experienced anyone using dynamic ad inserts on a podcast to deliver targeted advertisement.

Splicing in different audio ads into a specific portion of an ad isn’t a technologically difficult challenge to solve. Dynamically inserted ads, or even programmatically matched and inserted ads, can open up new revenue streams and markets to podcasters — who can also benefit from diversifying their income streams.

Advertisers prefer host-read ads, and 60 % of podcast advertising revenue in 2016 came from host-read adspots, according to a study by PricewaterhouseCoopers. Dynamic ad insertion can work for host-read ads as well as produced adspots delivered by advertisers.

It has proved impossible to dig up any numbers on the breakdown of the international listenership of podcasts. However, English is an official language in as many countries as there are states in the US. It’s a second language in more than double that number. Only about 20 % of the world’s English speaking population lives in the US. That leaves a huge unmonetized market ripe for the picking if podcasters only had the right advertiser inventory.

When the occasional advertiser accepts international customers, their aired promotions don’t apply outside the US. No service discounts, and no two free audiobooks either. Not to mention that promotional codes or offers burned in to the main audio program may expire, the ad read by the host will live on for perpetuity.

But things seem to finally be changing. As reported by AdExchanger, Matt Lieber, president of Gimlet Media, said the following at an event in 2016:

Until recently, whenever we put an ad into the show it stayed there. Forever. […] [We now] put the ad in and it stays there for a certain amount of time and it comes out when it’s reached a certain amount of impression.

Dynamically inserted ads have many benefits besides letting the host keep their credibility and independence. (Something I believe it’s near impossible to achieve with host-read ads.) While interest/tracking based advertising isn’t currently possible in podcasts, dynamic ad inserts can still enable podcasters to sell the same adspot to different advertisers in different regions and at different times.

For example, a very simple location targeting to get podcasters started could be to split U.S. listeners and everyone else up into their own segments. Instead of pushing ads that only work on U.S. listeners to an international audience, podcasts could diversify their revenue streams by having ads they can profit from — even at a lower rate — instead of serving ads for companies and services that aren’t even available in their region. Even without one or more international advertisers lined up, podcasters could better monetize this segment by addressing these listeners directly and ask them to donate or buy T-shirts. This same ad could be used as a fallback advertisement for U.S. listeners too if a podcast suddenly found itself without an advertiser.

Companies like Megaphone by Panoply and Podbean already offer dynamic ad insertion and location-targeted episode delivery to podcasters. Acast and AdsWizz AdWave are working on extending this to create ad marketplaces for programmatically driven automated dynamic ad insertion akin to how Google AdSense works for web publishers.

Dynamic ad inserts combined with programmatically matched ads would also make it easier for podcasters to monetize their back catalogs of old episodes. Something which could encourage the production of episode transcripts and other methods to help make old episodes more discoverable.

I hope more podcasts will embrace location based dynamically inserted ads. I don’t want to listen to a dozen ads for products and services that aren’t available in my region every week. It’s not only wasting my time, but also depriving podcasters of potential revenues.

This might sound like a silly idea, but I believe that ads relevant for your region would make podcasts more inclusive. They’d help transform shows for something exclusively for the North American market to something that’s more approachable for a wider international audience.