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Nearly A Quarter Of Ad Buyers Are Unfamiliar With Live-Read Ads.

The gap between the amount of time spent with digital audio versus the medium’s disproportionately lower share of ad spend is where analysts say the near-term growth prospects exist for audio publishers. But the challenge begins with awareness. New data from WARC shows that despite podcasting’s growth, nearly one in four marketers (23%) working in the retail and consumer packaged goods categories are unaware of live-read ads.

It is likely a reason why live-read ad usage trails that of other formats. WARC says 27% of marketers report they have used live-read ads to date, compared with more than four in ten that said they have already used recorded ads or branded content.

“Our research suggests this lack of awareness is behind lower levels of adoption,” says WARC. “Given the proven effectiveness of live reads, limited competition may present an opportunity to stand out,” its report says. WARC says podcasters and ad agencies should fill the “awareness gap” while brands are urged to jump into the format at a time when competition remains relatively scarce. “Given that research has found host-read ads to be particularly effective in generating an emotional connection with listeners, this suggests an opportunity for both the digital audio industry and for advertisers,” the report says.

Even as some brands have yet to make the leap, those that do know and use host-read ads are singing the format’s praises. Instacart CMO Laura Jones says in the report that her company’s host-read ads for its “The World is Your Cart” campaign “really broke through” and she received a lot of anecdotal mentions from friends, coworkers and even executives at the company.

“There’s something that feels a little more personal because people associate so strongly with their podcasts,” Jones says. “So when you show up in the right podcast for your ideal audience, there’s something really delightful and organic.”

While ad unit specifics may still need some sorting out, marketers in general now recognize that digital audio has the ability to connect with consumers, according to WARC. The just-released Sonic Boom study, conducted by WARC on behalf of Spotify, surveyed over 350 CPG and retail marketers from the U.S., Canada, the UK, Germany, France, Italy and Spain. It found advertisers in North America were more likely to be familiar with podcasting – and that they liked what they see. More than a third (35%) of North American ad buyers strongly agreed that digital audio platforms allow targeting by mood and moments while 30% strongly agree that companionship is a key selling point for music streaming services.

WARC says consumer packaged goods brands are more upbeat than retailers on podcast advertising – 83% of CPG brands agreed podcast listener growth since the pandemic made it a more viable media, versus 71% of retail marketers that said the same. And 81% of CPG ad buyers agreed that podcast audiences were highly engaged versus 71% for retail.

Working in digital audio’s favor is that marketers overall think multichannel campaigns have the potential to deliver higher returns than single-channel ones, especially when they are tightly integrated. Among the marketers that WARC surveyed, 62% in North America say they see strong opportunities for combining podcast ads with social media ads. And 60% said they like the idea of coupling social media with ads on music streaming services.

When it comes to combining the spoken word and music forms of digital audio, once again CPG brands were higher on the idea than retailers. WARC says half of CPG brands said they were interested in combining podcast and streaming music ads versus 40% for retail.

“Music streaming service ads are often designed to reach a large audience and build awareness. They aim to introduce potential consumers to the brand and create an initial impression,” says Kellogg Company Senior VP Charisse Hughes. “Podcast ads, on the other hand, are typically longer and more integrated into the content. They are intended to reach an engaged and attentive audience and are often designed to drive product consideration and purchase intent,” she says in the report.

While music is a trigger to memory and emotion and is a lean-back medium, podcasts are a lean-forward format. But as marketers approach digital overall, WARC analysts say that research shows “soft benefits “ of digital audio platforms are likely working in the medium’s favor, as consumers are seeking out platforms that are high on stimulation and low on stress.

Download a copy of the WARC Sonic Boom study HERE.

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