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Acast CEO Ross Adams Says Ad Concentration Is Inflating Podcast CPMs.

Anyone looking to buy a plane ticket this summer knows the story: higher demand equals higher prices. Acast CEO Ross Adams says that is playing out in podcasting too, as advertisers hone-in on the top 500 shows that account for just 12% of the addressable podcast audience each month.

“This concentrated demand leads to inflated CPMs for media buyers and higher ad loads for listeners – all while advertisers are hitting the same audiences over and over again,” Adams says. He points to Magallan AI data showing podcasts in the top 500 have a 30% higher ad load than shows in the top 3,000. “This results in a reduced share of voice and increased category clutter for the advertisers,” Adams writes in a blog post.

Adams’ comments come on the heels of several research reports from the podcast hosting company that have looked to illustrate the ad concentration in podcasting, as well as what it believes are the negative impacts to the future growth prospects for the industry. During the IAB Podcast Upfront in May, the company released its research showing U.S. advertisers are missing 88% of the addressable podcast audience with their focus on the top 500 shows. It has also released a survey that found listeners of smaller-sized podcasts are 90% more likely to welcome ads on the podcast they listen to compared to listeners of large-sized podcasts.

“To put it simply, by concentrating their spend to just the top 500 or even 1000 podcasts, advertisers are tarnishing their own campaign effectiveness,” Adams says.

For Acast, there is more than altruism at play. It launched a self-service advertising platform last November in the hopes of attracting more medium and small advertisers to podcasting, with the promise to also go deeper into the ranks of shows. Last month it added the ability to book host-read sponsorships in its marketplace. The results have been promising. Since launching, Acast says more than 150 brands booked campaigns and nearly 40% of advertisers booked repeat campaigns.

“By introducing technology into this process, Acast is taking action to reduce media bias and oversaturation on the top shows by introducing media buyers to more podcasts – and audiences – that fit their campaign goals, but they otherwise may not have known to consider,” Adams says.

“There are more than 2.3 million English-speaking podcasts in the U.S. alone – buying on just what you know is going to eliminate a lot of inventory and audience potential,” he writes.

Acast has also Acast launched a first-party data targeting solution that through partnerships with LiveRamp, Adobe, and others, enables advertisers to leverage their own first party data to target podcast audiences. Adams says that enables advertisers to find their exact audience with first party data matching across all listening apps. He says the innovation has resulted in a 230% increase in advertiser lead generation, while also attracting new global brands to the company.

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