Economic uncertainty could have more publishers and marketers trying programmatic ads for podcasts

Like your Facebook relationship status circa 2008, the podcast industry’s relationship with programmatic advertising could be best described as “it’s complicated.”

Programmatic advertising represents a small portion of podcast ad spend. It accounted for 2% of spend in 2021, per the IAB. By 2024, that share is expected to grow to just under 10%, Insider Intelligence predicted.

One of the companies trying to drive that growth is AdsWizz, a tech platform for digital audio owned by SiriusXM that includes an audio-centric supply-side platform called AudioMax and its demand-side counterpart, AudioMatic. AdsWizz is one of the predominant forces in audio ad tech, claiming to operate the first marketplace of podcast-only inventory.

“The usage is really taking off more in the last year,” Anne Frisbie, SVP of global business development at AdsWizz, told Marketing Brew.

Even as podcasts have become more popular over the years, some audio buyers and sellers still aren’t totally sold on programmatic advertising, since the industry has historically found success with host-read ads. There have also been instances of programmatic tech leading to ads appearing in episodes they weren’t supposed to, like BP and ExxonMobil spots showing up in science pods that block ads from oil and gas companies.

Still, thousands of publishers and dozens of agencies transact programmatically to some extent through AudioMax and AudioMatic these days, according to Frisbie, who worked at Yahoo in the early 2000s before spending more than a decade at mobile ad-tech company InMobi. Spotify and iHeart also offer programmatic marketplaces for audio.

Frisbie said current economic conditions give her reason to believe even more will buy into programmatic this year. Several podcast networks have recently started selling their inventory programmatically, suggesting that the industry may be increasingly interested in a method that has long represented only a small slice of its ad revenue.

“Things have changed quite rapidly over the last two or three years,” Frisbie said. “Now, most of your top podcasts and top podcast networks do make their inventory available to programmatic buyers.”

Turning of the tide?

AudioMax and AudioMatic have been around since 2015 and 2016, respectively, but Frisbie said it wasn’t until the past year and a half that podcast inventory—premium podcast inventory in particular—started to gain traction in the programmatic marketplace.

Before the shift, “there were premium podcasters that had such high fill rates on their advertising from just their direct sales efforts, and at very good CPMs, that they didn’t really need to bother, to be quite honest,” she said.

Now, the economy—and the advertising industry—look different. Buyers are facing more pressure to demonstrate that ad dollars are being spent efficiently, Frisbie said, and inventory might not be selling out as easily anymore.

“Even if someone’s doing as well with the buyers today, which would be hard just based on macroeconomics, they might have twice as big of an audience,” she said. “Not just the economy, but the sheer increased interest and listening hours from consumers is also meaning that we have to evolve.”

What seems to be a growing interest in programmatic is reflected in SiriusXM’s earnings: Overall ad revenue from its Pandora and off-platform segment—which includes fees from AdsWizz—was down slightly year over year in Q1, but revenue from fees tied to AdsWizz’s programmatic platforms on their own grew 20% year over year in Q1, according to Frisbie.

“There’s more money on our platforms being spent today in programmatic buys for streaming inventory than there is for podcasts,” she said, but added that “the growth is faster on the podcast side.”

AudioMax’s clients include major podcast publishers like New York Public Radio, The New York Times, The Washington Post, Univision, Barstool Sports, and Betches Media, Frisbie said. Barstool and Betches confirmed that they use AudioMax; the rest either declined to comment, did not respond, or hadn’t confirmed by publication time. NPR and Acast also said they use the platform.

Buyers using AudioMatic include Dentsu’s 360i and iProspect, GroupM’s Xaxis, performance audio agency Veritone One, and digital media agency Division-D, according to Frisbie. Xaxis, Veritone One, and Division-D confirmed they use the platform; Dentsu hadn’t confirmed by publication time.

Seller’s skepticism slows?

Some major networks have started testing programmatic podcast sales as recently as this year. Betches Media, which has more than a dozen podcasts, began using AdsWizz in April for unsold inventory, according to Arisara Srisethnil, its VP of marketing. Crooked Media started selling some inventory programmatically last year after partnering with SiriusXM for ad sales, VP of Sales Giancarlo Bizzarro said.

Rogers Sports & Media—the media division of Rogers Communications that owns TV channels, radio stations, and podcast companies across Canada and sells podcast inventory for companies like SiriusXM, NBC, and the NHL—started selling programmatically through AudioMax about 12 to 18 months ago, according to Mike Viner, director of digital audio advertising at Rogers Media.

The company already had a “very robust programmatic business” in display and video, he said, so programmatic audio felt like a natural next step. “We want to be agnostic,” Viner said. “We want to make our inventory available where buyers are buying.”

Acast saw some increased interest in programmatic late last year and early this year, according to Global Head of Ad Innovation Elli Dimitroulakos, particularly with regard to private marketplace deals. Programmatic sales made up 13% of the company’s revenue at the end of last year, up from 10% the year prior.

Opting for options

Michelle Slinkard, chief business development officer at Division-D, said AudioMatic, which it’s been using since 2018, is the agency’s “biggest DSP for audio,” but that it also uses The Trade Desk, Yahoo DSP, Amazon DSP, and Spotify Ad Studio for programmatic audio buying.

“The reason we got into it is because we work with a lot of local and regional clients, and programmatic audio gives us the ability to scale more effectively into niche targets,” Slinkard said. “We also really like to pair it with cross-channel remarketing...and when we’re running everything programmatically, the whole process is much more seamless.”

AudioMatic is the “DSP of choice” for Veritone One, according to Managing Director Conor Doyle. The agency has been using it since 2020, though programmatic accounts for a “small percentage” of its podcast buys, he said.

As a performance agency, many of Veritone One’s clients are still most interested in “aligning with talent” for ad reads, which “doesn’t often lend itself well to a programmatic style,” Doyle said.

Still, he said there are other benefits to programmatic, like targeting and the ability to scale a campaign “in ways that we couldn’t do if we were just doing show-by-show or creator-led” buys.

The shift to programmatic is not without its challenges, but for her part, Frisbie is optimistic that interest, particularly on the network side, will continue to develop this year. “When things are great and you’re selling all your inventory in the way that you’ve sold before, you don’t have to change,” she said. “But when things aren’t as easy as they used to be…you’re usually open for much more change. This [shift] was going to happen anyway, that’s my sense, but I think it’s happening at a little bit faster pace.”