In the beginning of 2019, we predicted that it would be a big year for audio.
Ad spending on the medium was up, podcasts became a big topic at Digital Content Next, and research showed that US consumers spend a good portion of their listening to mobile audio.
Better yet, Midroll Media found that 6 out of 10 podcast listeners make a purchase based on the ads they hear within their favorite shows.
Read More: 4 Types of B2B Advertising to Watch in 2019
It’s clear that podcast advertising is both popular and effective. But what actually feeds this advertising format? A large portion of podcast ads are the audio-equivalent of native ads — sponsorships or scripts read off by podcast hosts.
But how do podcasts connect to programmatic tech?
Programmatic Within Podcasts: What We (Don’t) Know
The conversation surrounding programmatic ads within podcasts is more complicated than anyone would like.
For example, AdExchanger featured two apparently contradictory articles just a couple of months apart. One focuses on how programmatic audio took off in 2018. The other argued we shouldn’t expect programmatic ads for podcasts just yet, even after the spate of acquisitions that consolidated podcast power earlier this year.
“As the podcast industry gained steam in 2018, it also overcame some technical hurdles,” writes Alison Weissbrot. “As for programmatic, the buying method is still nascent in podcasting but the technology is advancing.” By way of evidence, Weissbrot points to Panoply’s new programmatic marketplace, Acast’s $35M Series C funding designed to move programmatic forward, and NPR’s foray into listener metrics.
In contrast, Weissbrot quotes several industry players in the second article that voice concerns about programmatic’s adoption within podcasting. “Part of your podcast campaigns will become programmatic,” RawVoice chief growth officer Jeff Hinz tells Weissbrot. “But all of the research skews toward host endorsements being a better ROI generator than ad insertion placements.”
In a phrase, the state of programmatic advertising for podcasts is still uncertain.
How Podcasts Move Programmatic Tech Forward
Its success all depends on the technology that can grow up around the demand. “The tech infrastructure that underlies much of digital ad buying wasn’t really made for audio,” Ross Benes writes at eMarketer. “The ad industry’s most popular ad servers and ad exchanges were originally designed for display. To ensure that their ad insertions aren’t too clunky, audio streaming platforms have had to build a lot of their ad tech themselves.”
According to some, the tech is coming. “Standardized measurement will come,” one Spotify automation lead told The Drum. “If you look at video, there are a lot of verification technologies out there. None of these have a metric for audio, yet. As adoption grows and expands those layers of verification and development will expand.”
Which brings us to our second question: have podcasts affected advances in programmatic tech?
For their part, Pandora, Apple, and Spotify have all been exploring the foundational tech they will need to support programmatic ads within their audio platforms. Pandora even opened its ad inventory for programmatic buying partway through last year.
And, in a twist connecting audio ads with search ads, Google Podcasts is now automatically transcribing episodes. Right now, the resulting transcripts are simply being used as metadata to help users find podcasts they want to listen to.
But it also sets up an easier potential for contextual ads purchased programmatically. This is the kind of tech that will move the needle on programmatic ads for podcasts.