The Benefits of Podcast Advertising for Subscription Brands
AMA with Stephen Smyk, SVP of Podcast and Influencer Marketing at Veritone One
As you and your team continue to accelerate the subscription-based digital transformation, we want to focus on discussing proven and adaptable acquisition and onboarding strategies that not only drive growth, but ultimately lead to a better full-journey subscriber experience and an increased customer lifetime value. Our goal was to deliver actionable insights and provide connections for your continued success.
Stephen Smyk, SVP of Podcast and Influencer Marketing, Veritone One
“It is time consuming to do a regular evaluation of media and placements, but it is tremendously helpful in supporting high retention metrics - we used similar strategies for subscription video products.”
Full Transcript
*Questions submitted by community members
Welcome everyone to this weeks AMA with Stephen Smyk, SVP of Podcast and Influencer Marketing, Veritone One. Check out his fantastic professional journey summarized on LinkedIn! But here are a few additional interesting facts that you won't see on LinkedIn 🙂
Please describe your current role?
Up until December 31, 2022, I was the SVP of Podcast, Influencer and Digital Media for Veritone One. Currently I am the CEO of Podfluential a podcast and Influencer consulting agency where I advise brands on best practices in online and growth marketing.
What do you think you could gain from joining the SubscriptionWorks community?
I am curious about acquisition and retention marketing as I have been actively involved in the industry for 25 years and continue tracking the evolution in the space.
The first album I owned was...
AC/DC - Back in Black
The first concert I saw was…
With or without my parents? Hall and Oates (with parents) or Bryan Adams (girlfriend's choice)
My favorite movie is
Blade Runner
My favorite book is...
Dune
My favorite subscription is...
Audible
Please join me in welcoming Stephen Smyk to our SubscriptionWorks community!
Thanks for having me!
Question: Fantastic! We will start right on time and jump into our first question. What is the value of podcast advertising over other digital media?
Podcast advertising provides a different ad execution experience, reaches an audience that is difficult to find and, in some execution opportunities, provides a longer, in-depth endorsement from a trusted voice. Done well, podcast ads allow for a truly powerful experience and break through the clutter.
But how much do you really have to do to make a difference? It seems like the attribution model is really hard to quanitfy and it's expensive
The audience being difficult to find is interesting to me - could you expand on this?
I wondered the same
Ok, to make a difference, depends so much on what goals are --- and to your point how are you measuring. Podcasting has lots of ways to measure success/failure and for that reason can be very small (measure on direct attribution - last click in) to awareness metrics. As for audience - highly educated, not reachable through ads because they consume stuff on ad free platforms - Sirius/Spotify/Netflix, etc.
I love the emotional connection that podcasts seem to make. As a listener, they are literally in my head. when the podcaster reads an ad it definitely adds an endorsement
when done well it isn't broadcast - it's a personal endorsement
Question:Do specific brand categories perform better than others?
Tough question - some brand categories perform 'better' than others. However, how well a brand and category does depend on goals and how a brand measures success. Having worked with hundreds of brands over the past 20 years, I’ve learned that everyone’s goals are different as there are so many external forces that impact an organization’s acquisition goals. The difference between buying a mattress, a car, or getting a free product or service can’t be measured within a 48 hour click window. That being said, I don’t think there is any category that can't work if it works in other channels, as it is heavily based on success in other channels: What is the value of the product, how is it communicated, cost, benefit, consumer experience when the consumer reaches the advertisers site, etc.
Sounds like a radio ad pitch, but I'm guessing that there's a lot more opportunity with contextual relevance, and durability as podcasts have a decent shelf-life from dark social and seo. Are there topic categories with more opportunity or has it evolved to cover just about everything?
Yeah the radio thing is real and there are some real differences --- podcasting has the ability to truly be something that can educate in a way radio can't but it does share some benefits
Question: Here comes a loaded question…It seems like podcast consumption has grown substantially over the past few years. What do you think is driving that and will it continue? How might a recession impact this growth?
Ok, I've been asked this one a bunch lately. It has grown tremendously and there is little evidence that it’s going to slow down anytime soon. As it becomes easier to find and consume podcasts (easing the difficulties in finding and playing podcasts - apps, devices, etc.) the audience will continue to grow. What I believe will change is that we are running into merging channels/platforms --- a future of on demand audio is coming, so how we measure ‘podcasting’ in that universe is an interesting challenge. In the short term I don’t foresee the recession having much impact on listenership.
When COVID hit, there was a thought that listenership was doomed with everyone home – that actually turned out to not happen as listenership actually grew. Secondly, the idea that people like 'free' content in a recession may in fact help the channel. However, there is no doubt that it will impact content creators and advertisers as budgets have gotten pared by many advertisers over the past 6 -9 months, so there will be some content that may not be produced as ad dollars may not be there to support everything. Will this impact growth of the channel, probably not as there are so many shows out there today to choose from, I’m not sure that will have a sizable impact on the audience.
That reminds me that some podcasts are switching to a paid subscription model. Do you think that trend will continue?
Very interesting
Didn't Spotify just dump their owned/operated podcast program?
They have half a dozen - they own Gimlet, Anchor, The Ringer and of course have exclusive distribution deals with folks like Joe Rogan - plus they have an internal Spotify team, which they just made a little smaller recently.
Question: How should brands consider podcast advertising in their digital media mix?
It should be the first and only thing they think about. Seriously though it really depends on the organization, goals, product, measurement capabilities, etc. Over the past number of years I’ve gotten to witness how powerful podcast advertising can be when done right. To Matt's comment above, some look at podcasting as a ‘new radio’ and think of :30 scripted ads. That is one way to do it. I think one can look at the channel as a significantly ‘better’ radio, with more desirable demos, better ad placements, less clutter, less tuning out of ad (literally or figuratively) etc. Podcasting done well can be a key component to the core of a digital media campaign. The long ad length, the desirable audience, the hyper targeting abilities along with partnering with trusted voices mean that the audience can be a significant driver to an acquisition campaign. The ads are memorable, informative and are reaching the exact audience most marketers are seeking. I am hard pressed to find a better mix of the key items a marketer is looking for than in podcasts. That has been my belief for the industry since I placed my first podcast ad in 2006 and I still believe it after all these years.
I may come back to this one....not going to let you off the hook so easily 😉
I think Nini Diana hit the nail on the head with her question about the attribution. This has been the most interesting thing about the growth of podcasting to me, in a world of required attribution it has dodged the scrutiny - why?
Because using RSS has made it difficult --- podcast attribution can't be done like other channels . There are some ways to try and make it like digital, but it really isn't because it is based on RSS and the bulk is downloaded, not streamed
Question: Is there an average range of digital media budget allocated to podcast advertising?
Not really – I’ve worked with some clients where it has been their only marketing channel other than search, to some clients spending hundreds of millions of dollars that wanted to buy ads on a few shows they, their boss and the CEO listen to. Again, depends on what you are seeking to achieve and how you measure success. The significant majority of advertisers in the space have maxed out search and Facebook, then are looking for additional channels and usually depends on where they are in the growth cycle.
So much of it comes down to goals - historically I've worked with brand and growth teams and their allocation will be wildly different based on their goals...
So I am selling subscriptions to my widgets and have not budgeted for podcast advertising but want to try it out...what is a good budget range?
As an initial test, I've seen some folks start with $200 and scale upwards. Realistically though, I would budget probably $100K over a 3 month period (~$30K a month) to get a good read on genre, ad read, etc. if I was looking for scale.
Awesome! thanks for letting me push for some hard numbers on this one.
That should give somebody the opportunity to test 30-40 shows, a few with a little frequency and different ad reads to get a good feeling of how it can scale. Historically, this will give most folks about a 30-40% success rate (shows hitting goal acquisition cost) and will provide the data for building out the program efficiently.
Question: Advertising subscription businesses on podcasts must be successful because it seems that nearly all the ads are for subscriptions? Why do you think they are so successful?
Many do gather survey data from audience members and Nielsen Scarborough is able to add some household consumer insights. Additionally, there are ways to buy some geo targeted inventory. Audience data is one of the complexities of podcast advertising - there is some data and depending on how you are buying and executing a podcast campaign, there are some ways to gain a bit more information on a podcasts audience, but there is no easy channel wide solution. Podcasting is horribly fragmented...
Question: What % of acquisition volume can come from a healthy podcast advertising program?
Varies dramatically – see above answer. Some advertisers rely heavily on the channel, typically when they are smaller and have lower budgets. I have watched some clients dedicate more than 50% of their growth budgeted to the channel, so it can be a truly significant amount based on the size of the campaign. Majority of evergreen acquisition campaigns probably 10-20%
Very helpful
Question: Do you see stronger LTV from podcasts relative to other channels?
Historically, yes. There are lots of potential reasons for this. First, the composition of the audience (high HHI and education). Second, the measurement hurdles associated with the channel means people really want the product (remembering the promo code or URL and using it). Third, frequency of ads on a show – reminding them of the benefits of a product regularly. Fourth, trusted voice reinforcing the value of product extends LTV.
Very interesting - never thought of this as something that could help retention as well
Has become a key component of messaging strategies for companies that have been advertising in channel for years and have acquired thousands of customers in channel
I love thinking of podcasts (which have an ongoing relationship with listeners) as a retention play for subscription brands
Question: Tips and tricks for podcast advertising - how is it different from other digital channels?
Oh so many tips and tricks. YMMV, but I personally see podcasting as a staged channel. First, hyper-targeted content with host reads - that should be core of a program and is the low hanging fruit and will be the most efficient media. After building that out, move on to shows that offer host read with targeted audience profile. Then keep expanding until the media get inefficient. After that look at ways to reach those consumers, build remarketing strategies to those that have reached the site from particular shows. Change creative regularly on shows that are core – always talk about new offerings, product features, etc. Keep frequency low – people are listening to the ads – no reason to go overboard on frequency, it's just wasting money especially the way consumers consume podcasts – it is not radio or TV where people don’t listen to the ad.
Like most media investments....clearly, experience makes a difference in maximizing the return.
I like the insight of low-frequency vs breadth of reach
Question: What characteristics should brands generally keep in mind about podcast listeners?
Typically they are very educated and have more insight into advertising as many podcasters actually talk about their ad spots and business economics during their show. If you have the opportunity, allow the host to talk about the product or service while providing some guidance as to product features and benefits --- create authenticity (or something close to it). Listeners can tell the difference between an ad and a product that the host actually has some interest in…
Why do I feel challenged to find podcasts that appeal to less educated folks, just so I can prove you wrong? 🙂
So true, Stephen. As an avid Smartless podcast listener I can see the authenticity of the 3 show podcasters as they talk about and promote the ads.
Peter Figueredo (House of Kaizen) perhaps the most popular podcast, Joe Rogan?
Peter Figueredo (House of Kaizen) there are - it isn't all high brow, but as an example, I would argue it is easier to find CTOs and CEOs within a handful of podcasts than maybe anywhere else??? Especially with a longer, education oriented ad - TV? Print? Digital? Now the bigger challenge is scale...
I’m wondering why it’s generally accepted as effective without the attribution - it sits in a unique place where people believe it works though it’s not demonstrable in the same ways their other channels are. Btw, I think this is a good thing in some ways.
Question: What's a common misconception you see that brands have about podcast placements?
Podcasting is not digital. There are many digital aspects that are not applicable to podcasts, primarily because of the way RSS feeds work (RSS is the system that podcasts run on). It was not built to be an ad supported medium - in fact it was created to avoid major media ad models. For that reason, I think the biggest misconception is the idea that within 24 hours, one will have an idea of a campaigns success. Depending on how you buy a podcast placement and where you buy it, you are buying a podcast download, not a listen. While there is some dynamic ad insertion, many downloads sit for some time in a person’s podcast queue. Honestly could do hours on this and maybe when I write the book, I’ll have multiple chapters dedicated to this very question.
Write the book!
Probably would sell seven copies and three of them would use my card (my wife and daughters)
Question: What makes a podcast listener different from other types of potential customers for subscription brands?
See above – very educated, high HHI audience that probably can’t be reached in other channels. Very unique group and highly, highly valuable. Marketers regularly complain about their inability to find the demos that are the majority of podcast listeners because they don't listen to the radio or watch ad supported TV anymore.
Question: We know that cross-device content consumption leads to higher CLV for subscription content companies, can you speak to how podcasting fits into creating cross-device behaviors for retention?
A variety of ways. For example, a large audio content provider that we worked with for many, many years would identify shows where they know their audience resides based on acquisition metrics from those shows and would regularly promote new titles based on the show’s genre - sci-fi and business titles on shows about technology. It is time consuming to do a regular evaluation of media and placements, but it is tremendously helpful in supporting high retention metrics - we used similar strategies for subscription video products. When an advertiser finds pockets of acquisition success and regularly (monthly, quarterly, with low but regular frequency) announces new products/features has always helped with retention while still acquiring new customers from those channels.
This sounds like a genius strategy.
oh hey Taylor Huttner...have you met Stephen Smyk 🙂 Turning this joke inside out for the benefit of the community...Stephen, Taylor, and I have all worked together for many years supporting growth at http://Audible.com. Some of which resembles the comment above.
It was all Taylor's idea
Question: Wow, my brain is full Stephen Smyk so thank you...let's close our with a few softball questions. What are the top 3 podcasts you listen to regularly?
I prefer questions I can’t get wrong. My listening habits change regularly (based on sports season, political season, etc.), but there are some shows/hosts that I listen to a bunch of their content and it’s not the ‘big’ guys. Of course over 17 years of listening, the How I Built This, This Week in Tech, Smartless, The Daily, WTF with Marc Maron, Pod Save America, Hidden Brain have all held my attention for long periods of time. However, the first three that are in my queue right now though are Upgrade (Apple/Tech), The Watch (prestige TV) and Anything is Poddable (Boston Celtics).
Great list. I will give a few of them a try...after Smartless.
I agree @Carolyn Jeskey I think I may try a few myself
Currently, I am loving the people vs algorithms podcast by @Brian Morrissey as well as Ologies and for some fun....Always Sunny Podcast 🙂
While we're suggesting...For current events, you can't beat Magna and https://www.wbur.org/radio/programs/onpoint, +1 for Hidden Brain, +1 for The Daily. And for one-off specials, https://features.apmreports.org/sold-a-story/ will light a fire for anyone with an interest in education
Question: Our next AMA speaker is Micalea Shaw, what question would you like to ask her? She is the CMO at Embodied and former VP Marketing at Literati
One that hits close to home - as I deal with folks who move to new positions regularly: What is a key lesson from her time at literati she plans to apply to embodied immediately?
Come back on Feb 28th at 1pm EST to find out the answer to this question and others when we are joined by Micaela Shaw