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Why Contextual Targeting Is a Winning Podcast Advertising Strategy

The podcast ads business is at a tipping point. The audience is there—57% of U.S. digital-audio consuming adults listen to podcasts, spending nearly an hour per day with them—but marketers need capabilities that allow them to invest beyond show-level and find scale against their audience in order to truly take advantage of this rich medium and format.

Podcasts have unique data considerations

The digital media ecosystem, namely targeting and measurement, was built on widely available signals like cookies and mobile ad identifiers. These signals have long provided marketers with the ability to reach their audiences and measure the effectiveness of their campaigns. While the availability of these signals is diminishing as consumers take control over their digital privacy, podcasts have been playing an entirely different game from the start.

The unique way in which podcasts are distributed and consumed—via RSS feed or progressively downloaded to any number of podcast players a listener may choose—means those common signals were never available in the first place, the consistent data signal being IP address.

An identity graph is required to match IP data to, for example, a mobile ad ID (MAID), and only after that can the data be matched to an audience dataset, all the while needing to toss out any data that couldn’t be matched, minimizing the overall size of the dataset. Ultimately, this process inserts multiple degrees of separation between consumer and advertiser, which may be entirely unnecessary with an environment as rich as podcasts.

Enter contextual targeting

Faced with the realities of signal-loss in digital environments marketers, publishers and ad technologists are turning attention back to contextual targeting. In fact, 42% of advertisers say they will increase emphasis or spending on contextual solutions in light of the deprecation of third-party cookies. Once you know where your audience is, and what they are consuming, connecting becomes easy and you don’t need a string of device identifiers to reach them.

This is a timely development for podcasts given the growth that advertisers are looking to achieve and the freshly renewed relevance of contextual targeting. Given the data realities of podcasts against the broad depth of content and subject matter they cover, contextual targeting solutions are incredibly valuable in connecting advertisers to the content and audiences they want to reach. After all, context (whether in content or the show-host themselves) is the value of a show-buy. Now all that is needed is a path to scale.

New ad tech translates content into contextual scale

New (and old) technology—transcription services, automation and artificial intelligence—are being married together to provide a framework for data-driven solutions to effectively work in podcasts. Podcast content is rich, diverse and nuanced; it’s just a matter of getting that content onto paper to make it actionable.

Translating voice-to-text is a first step. From there, AI can be used to pull out the contextual essence of a podcast episode. Translated, this means that the difference can be made between the word “shooting” being used in the context of basketball vs. coverage of a crime, which is critical in advertising. For example, between a diaper brand who wants to ensure their ads are only showing up in family-friendly environments, or for a sports drink brand who is looking to reach all the sports content in the market.

42% of advertisers say they will increase emphasis or spending on contextual solutions in light of the deprecation of third-party cookies.

While the tech provides a way to understand context at scale, advertisers can’t let machines do it all and need to come to table with a strategy that is curated to the medium, especially when it comes to brand suitability.

Take True Crime for example, an incredibly popular podcast with no shortage of coverage of death or acts of violence. However, if a brand has anti-targeting set up to avoid anything of violent nature, they would be missing out on this rich (and likely relevant) audience. Brands will need to take an individualized approach as they are considering different levers made available to them to reach, or avoid, certain types of content.

Contextual solutions will only continue to mature

The ways in which marketers can find relevant moments and audiences in podcasts are only becoming smarter and more advanced. We see increased adoption of solutions that can connect consumers’ behaviors and media consumption to podcast content itself, allowing marketers to reach audiences at scale all through contextual powered solutions.

At SXM Media, we’ve always focused on connecting marketers with their audiences in ways that not only meet their needs but are the smartest solution for the data at-hand. In podcasts, we believe that doubling down on the rich, intimate environments they provide and investing in ad tech that brings this from concept to activation is what will give advertisers the ability to take advantage of this medium in ways they haven’t before.