How to Tackle Podcast Ad Measurement Challenges

As part of a recent webinar, Right Side Up’s Head of Offline Marketing Krystina Rubino connected with Cameron Hendrix, Co-Founder & CEO of Magellan AI, to discuss the challenges and successes of podcast ad measurement and media planning. Check out the highlights of their conversation below, or catch the full webinar on-demand here.

Podcasts reach more than 100 million American adults every month. The media landscape of podcast advertising has huge potential to drive growth and impact. But many podcasts aren’t monetized. And the lack of ad tech for campaign measurement that digital marketers have come to rely on has made this channel tough to crack for advertisers and media buyers.

However, for podcast ad veterans that embrace offline marketing measurement best practices, the path to success is clearer than ever.

Right Side Up’s Krystina Rubino has more than 15 years of experience as an integrated marketing leader. She has spent the past five years immersed in offline marketing. And she has helped more than 60 brands invest upwards of $50 million in podcast advertising at Right Side Up while paving the way for a more accessible, transparent, and profitable offline media buying landscape.

Krystina met Cameron Hendrix in 2017. He was launching Magellan AI, a technology solution that helps advertisers track podcast ad creative and trends to help facilitate media buying. Since then, the platform has become a key resource in Right Side Up’s offline marketing playbook. (And Krystina has become an advisor to Magellan AI.) Before founding Magellan AI, Cameron led strategic partnerships at Thinkful (acquired by Chegg) after starting his career at Goldman Sachs.

Surveying the Podcast Ad Landscape

As Cameron mentioned in the webinar, Magellan AI has captured data from more than 30,000 podcasts since 2017. And of those, less than half were monetized. Today, that number is growing—in 2020, Magellan AI looked at its 11,000 most-sampled podcasts and found that 75% were monetized. 

Although there are millions of podcasts, advertisers seem to focus on a core group of around 8,000 shows, according to Magellan AI. That small number can be chalked up to a few factors. Some podcasts, like indie political hit Chapo Trap House, fund themselves through Patreon; others, like Exchanges from Goldman Sachs, (clearly) don’t need to rely on ad revenue; and the rest are either not set up for monetization or aren’t the right fit for most businesses.

And Krystina says that’s on track with what the offline team at Right Side Up has seen.

“We've purchased over 1,700 shows, across 170 different networks, partners, and direct partners,” she said. “So if you think about 1,700 shows out of 2 million podcasts, the reason that we're actually here is because nobody knows what to buy unless you have access to performance data that helps you figure out the best shows to buy, coupled with platforms like Magellan AI that provide context into the full ad landscape.”

Within the world of podcast advertising, there are two main categories of delivery:

• Dynamic ad insertion (DAI) spots allow ad reads to be placed anywhere within a podcast episode. And it works for both current and back-catalog content. This method also allows for greater control of time-sensitive messaging or promotions. It can sometimes allow for demo targeting, depending on the ad hosting platform capabilities. 
• Embedded ads, which are often referred to as baked-in ads, stay in the same spot in the same episode forever, regardless of the relevancy of the content. Embedded mid-roll advertisements are historically the performance vehicle of choice. And they still represent a majority of the podcast ad inventory RSU recommends advertisers buy.

The two formats can also be used together for a hybrid approach, where you schedule episode-specific DAI. Krystina and Cameron explained that regardless of the delivery method, capturing metrics for podcast ads has always been tricky. But not impossible. Spots are typically tracked by pixels or third-party platforms, like Magellan AI, but we’ll dive into that later.

As the podcast advertising landscape grows, there are a few emerging trends to watch:

• Increased programmatic buying and dynamic ad insertion
• Lower barriers to entry for brands to test offline ads
• Channel convergence and the rise of contextual targeting over behavioral targeting

However, Krystina cautioned that some of those shifts aren’t a guaranteed slam dunk and pose significant challenges for podcast advertisers.

“Programmatic technology was developed to monetize a glut of inventory on the interwebs,” she said. “We do not have a glut of inventory in podcasting. It’s a finite inventory supply.”

Krystina is also not a fan of the lack of transparency for advertisers to know where their ads ran—a problem with existing programmatic-light ad networks—or the risk of questionable user experiences. She recalled a particularly jarring first-hand example.

“I was listening to an episode of Oprah’s Super Soul podcast and a Weight Watchers ad came on when I was in the middle of choking up about Lady Gaga’s health struggles,” Rubino shared. “It was so loud, completely out of context, and I will literally never forget it.”

One way to create a great user experience is the magic of host-read ads. Listeners already have some level of trust for the host narrating their favorite podcast. Because of that, there’s huge potential for advertisers to partner with hosts like they do influencers. When given effective creative and relevant information, hosts can deliver authentic ad reads for your product or service in their own voice that resonate deeply with listeners. 

Podcast Campaign Planning Insights

As the barriers to exploring podcast advertising continue to fall, understanding the planning process is key for driving successful results. Historically, performance data has been largely inaccessible to all but a few big buyers that purchase inventory for clients. But by aggregating that data and increasing access through new resources, more advertisers are able to adopt offline channels. 

At Right Side Up, that information lives within our proprietary Performance Indexing Tool (PIT), which compiles cross-client performance data. This resource helps the offline team make smarter planning decisions based on past podcast ad performance. For a deep dive on podcast ad best practices, check out RSU’s Cracking the Code on Podcast Advertising for Customer Acquisition guide. 

In conjunction with our proprietary PIT tool, Krystina said the offline team at RSU uses Magellan AI to cut out the busy work that’s usually required during the media planning process, in addition to using marketing automation for repetitive tasks, and a home-grown suite of custom media management sheets and tools. While these resources make planning a bit easier, the podcast landscape as a whole is still reliant on cohort-based analysis. That type of information, along with publishing rankers and listenership charts, require careful subjective interpretation by experienced marketers before making a media buy.

“All of the charts and rankers are helpful and interesting directionally,” Krystina said. “But they are not the end-all, be-all. I would never go to an advertiser and be like, ‘You should give this podcast $100,000 because they were number two on Apple last week.’”

Media Buying and Podcast Ad Testing

There are many unknowns in the podcast landscape. And it's daunting to think about how and when to test into the channel, and how much to spend. Magellan AI helps advertisers get a better idea of what their competitors are spending and where. But Cameron explained that there’s no way to know exactly what’s going on.

“The reality is, we’re never going to know when you’re getting a two-for-one ad deal,” he said. “We’re here to provide a little bit of transparency into how we think the ad market is trading, but it is only going to be directional, for sure.”

That lack of certainty hasn’t scared advertisers away too much, though. As marketing channels see increased convergence, more and more brands are abandoning single-channel approaches. And they're turning toward a more diversified marketing mix. Companies can no longer rely on Facebook ads alone to drive sales. Podcasts make it easy to test a new channel before or along with other offline channels like TV and radio.

“We tend to parallel-path those channels all the time,” Krystina said. “It's really interesting, like TV and podcast, radio, all of these channels work in concert. And this is where we start getting back to old school concepts like cross-media frequency, and all of the things that we can't understand, unfortunately, about the channel just yet.”

Like all channels and marketing tactics, there’s no guaranteed ROI when testing podcast ads. And Krystina stressed it’s important to understand that the payback period for podcast ads is different than other digital channels.

“You can evaluate performance accurately about mid-way through your media flight, but for a full and accurate picture, you’ll want to evaluate performance between three to six weeks out from your last spot,” she said. “I’ve seen shows pay back two months later after our last spot. So you have to make sure that your performance window is set appropriately.”

And as for budgeting, Krystina likes what she calls the 70/20/10 method: “So 70 percent of your test should be in really solid tests, your core 20 percent should be more aggressive tests, and then 10 percent is fun money, basically your crazy things that could pay dividends.”

Essentially, most of your budget should go to podcasts that are likely a good fit for your brand. The rest can be split between shows you’re less certain about, but feel they’re worth testing. For more insights on crafting your campaign, check out RSU’s detailed breakdown of the podcast ad test campaign lifecycle. 

Measuring Podcast Campaigns

Like other areas of the podcast landscape, measuring the success of your podcast ad campaign isn’t an exact science. There are three main methods that offer helpful insights, each with their own pros and cons:

• Pixels are used frequently in digital campaigns. But as we’re seeing in other channels, relying solely on this method of attribution is quickly becoming obsolete. Pixels also miss out on capturing the results of content bleed, like when shows simulcast on YouTube. And pixels aren’t even fully adopted by all publishers, so you could be missing a huge chunk of impressions if you rely on pixels alone. Last, these kinds of attribution methodologies are only as statistically significant as the population they reach. E.g. the reason Facebook’s view-through methodology historically worked so well is because they ‘see’ most of the Internet population. These aren’t reasons not to implement pixel-based tracking for an additional view into attribution, but they are reasons why it’s not yet the primary method of attribution for the channel.
• Brand lift studies compare the organic search results of groups of people that were exposed to an ad versus those that were not to see if a campaign influenced their behavior. This type of measurement can be useful for awareness campaigns, but often falls flat for other types.
• Post-purchase surveys, or “How Did You Hear About Us” pop-ups, served to customers after a sale allow advertisers to get a more accurate idea of a campaign’s impact across all channels by level-setting your attribution data. This is RSU’s preferred option and generally the gold standard in podcast ad campaign measurement.

For growth-oriented marketers, post-purchase surveys tend to deliver the most useful data. And while they've become best practice for offline advertisers, all attribution methods must be considered in the right context to avoid jumping to false conclusions.

“We have to evaluate technology on its own merits and not make some of the same mistakes that we've made in digital,” Krystina said. “We need to give advertisers and publishers control from the outset, otherwise, we're going to wind up repeating the sins of the past.”

Finding Success with Podcast Ad Planning

Although the podcast landscape is still being decoded, it is ripe with opportunities to reach new audiences in cost-effective ways. Partnering with experts like Right Side Up and Magellan AI can help brands take advantage of the channel before it’s widely embraced by competitors.

With the right mix of measurement and planning tools, an understanding of attribution methodologies, and adoption of new technologies, podcast advertising doesn’t have to be any more mysterious than the digital marketing channels you’re used to.

To learn more about how to use offline marketing for your business and scale podcast advertising successfully, get in touch with Right Side Up at hello@rightsideup.co. And to hear all of the helpful insights from our podcast veterans Krystina Rubino and Cameron Hendrix, watch the full webinar here or check out the webinar transcript on Magellan's site.