Why have we been talking lately about a new golden age for audio?
Hardly anybody would deny that video today is booming. The range of video available has never been so varied, and with the market entry of yet more providers planned, this diversification shows no sign of slowing down. But can the same be said of audio? Where’s all this talk of a new golden age for audio coming from? Radio has been around forever and continues to be there, in the background. Let’s start by getting one thing clear: audio is much more than just radio. Innovations have changed the market and taken it forward – or, more specifically, innovations in the following areas: devices, platforms, and content. The main topic of conversation right now is the development surrounding the second podcast wave. Although podcasts have actually been around since as early as 2004, it’s only in more recent years that consumption of the form has really taken off.
With the growing proliferation of smartphones, mobile consumption of online audio offerings has risen significantly; after all, smartphones are our favourite device by far. Interest in online audio content has also been boosted by smart speakers and new digital applications for cars. These new devices have succeeded in making audio more personal and interactive.
In terms of platforms, it is mainly streaming services like Spotify, Amazon, and Apple Music that have served to expand podcasts’ media portfolio. These are used by almost 80% of people under 30, and by around 40% of the entire population according to an ARD/ZDF online study. These partly ad-free services are even drawing usage time away from other offerings, although they aren’t replacing them entirely – fully ad-compatible conventional offerings continue to be relevant. The usage situations associated with each format are quite different. On the one hand there is the largely mobile usage of streaming services on smartphones, and on the other there is the strongly habitual, mostly passive pattern associated with listening to conventional radio.
The YouTube of podcasts?
When it comes to innovative audio content, one topic is very much at the forefront these days: podcasts. Interest in the podcast market has been boosted to a new level by recent massive investments by Spotify. The Swedish company’s aim is to become the world’s No. 1 podcast platform. With the acquisition of Gimlet, Anchor, and Parcast, Spotify is not only pursuing the goal of further setting itself apart from the competition with its offering of exclusive content, but also of bringing publishers and creatives directly to the platform. Corresponding self-service solutions for podcast producers are being implemented to this end, which may significantly expand the long tail of the platform’s podcast range. In terms of distribution channels and findability, the podcast market has traditionally been organised along very diverse lines, with many different ways to search for podcasts and listen to them. Spotify’s investment could alter the market on a fundamental level – and make the service the podcast equivalent of YouTube. This is still a gamble on the future, of course, albeit a very promising one.
Content by opinion leaders, for opinion leaders
Despite the increase among users, podcasts are still by no means a mass phenomenon. As the Reuters Digital News Report 2019 reveals, a good fifth of German online users listen to podcasts at least once a month, whilst many of these are heavy users who listen to them several times a week or even daily. These users tend to be young adults who are well educated and higher earners. Regular podcast users are an attractive target group for brands. They are often people who are strongly interested in a particular topic that shapes opinions in their direct environment, and so functions as a multiplier. Podcast enthusiasts are harder to reach via conventional media, as they watch less linear TV and consume less print media than the average population.
A higher impact through listeners’ undivided attention
One of the biggest opportunities that podcasts represent for advertising is their high impact potential. A key characteristic of the podcast usage situation is direct, intensive contact between speaker and listener. The level of concentration devoted to actively selected content is high, and people often listen attentively and exclusively to podcasts without doing anything else at the same time. Acceptance of advertising among podcast listeners is also higher than it is in the case of most other media, as the advertising is better suited to the usage situation. Native ads recorded by the host are an especially personal form of advertising, tailored to the context. A further plus for advertisers is exclusivity, as a single podcast often features only a small number of advertising messages. At the same time, the resulting lack of scalability is one of the reasons why podcast advertising is presently still unable to deliver sufficient contact for broad reach campaigns.
In terms of usage behaviour, listening to podcasts is also limited with respect to the duration of the content. In contrast to the trend for maximally brief snippets for mobile use on the move, however, on-demand podcast usage is often longer, and listeners’ high levels of interest in the topics discussed mean that their readiness to engage is greater.
New options for audio campaigns
The decentralised way in which podcasts are marketed means that the market is still extremely fragmented at present with respect to advertising opportunities. Uniform standards of measurement are also lacking, which makes formats more difficult to compare. More progress is certainly also needed in terms of booking options and reach definitions if podcasts are to become a more relevant part of media plans.
These issues aside, however, podcast advertising is making new forms of address possible in the audio environment. High-intensity listening means that podcasts are less suitable for “noisy” ad breaks designed to motivate, and more suitable for brand showcasing and development. For the right target groups, this can represent a useful building block in an audio campaign.
And so it may well be that the golden age of the podcast is also coming. With both video and audio booming, the battle for users’ attention is entering a new phase.