Too much of a good thing may be one way to look at a new podcast ad record that was set during the first quarter. The latest Podsights Benchmark Report shows that as advertisers continue to direct more ad dollars to podcast, their hyper focus on the biggest shows is pushing frequency rates to new heights. During the first quarter the average was a record 6.32 frequency, a ten percent increase from the fourth quarter.
Frequency is the number of times a household is exposed to an ad, so that means based on Podsights data, among the campaigns it analyzes the typical listener heard the ad six times. That is above the recommended two- to five-times that it recommends marketers embrace.
The frequency rate has been steadily rising during the past year with increases logged by Podsights quarter after quarter. At the same time it has also seen conversion rates -- the measure of those who took action after hearing an ad -- declining. Podsights reports the conversion rate for the ad campaigns it measured during the first quarter declined 23% to an all-time low of 1.1%. And it was down by more than a third from a year earlier during Q1.
“We are seeing benchmark conversion rates lower year over year, which Podsights believes is driven primarily by the increase in average frequency,” it says. “There is an inverse relationship between frequency and conversion rate. As frequencies continue to rise, conversion rates continue to drop.” However, Podsight’s latest Quarterly Benchmark Report says rising frequency is most likely only one factor contributing to lowering conversion rates. The other big factor may be that as more brands become podcast advertisers, some brands will inevitably have less appeal to listeners.
Nevertheless, Podsights says the best advice is to keep a campaign’s frequency rate between two and five. It also says marketers should spread their ads across multiple publishers to also help ensure they are not simply hitting the same listeners over and over.
Podsights may be cautioning from running too many ads in the same places, but its latest report also offers guidance to advertisers on how many ads they should be running to maximize their conversion rate. It recommends brands testing podcasting should run at least 200,000 impressions in order to get their money’s worth.
Its data show the sweet spot with the highest ad conversion rate is among campaigns that had between 200,000 and 400,000 impressions. Generally, most campaigns that ran more than that had diminishing returns on the money spent. The exception were the handful of campaigns that flooded the medium with 8 to 12 million impressions. But in that case, the conversion rate was on par with those that had between 2 and 4 million impressions.
The data comes from Podsight’s Quarterly Benchmark Report, based on a rolling average of 12 months of data including about 7 billion ad impressions and more than 3,000 campaigns for 870 brands that spent a combined $408 million on podcasting. The company estimates it captures one of every three dollars spent in the space, an increase from its previous share of one of four dollars.
Download the latest Podsights Quarterly Benchmark Report HERE.