If Spotify’s recent podcast deal spree isn’t a sign that podcasting advertising is about to take off, than we’re not sure what is.

Joe Rogan, Kim Kardashian, DC Comics, The Ringer, Gimlet Media – all exclusive deals that haven driven Spotify to the 2nd largest podcasting platform, now only behind Apple.

These content kings are not only going to make Spotify a major podcast powerhouse that will scale their platform user subscriptions but will also exponentially grow their advertising revenue potential – especially since Apple has shown no interest to sell podcast ads at this time.

If you don’t know much about podcast advertising, this is a great time to dive in and learn how this media channel will be a major focus for brand marketers in the years ahead.

How does podcast advertising work?

Podcast advertising is typically priced on a CPM (cost per thousand) model and can range in CPM based on popularity and downloads a particular show episode my receive. There are mainly two types of podcast advertising spots –

(1) Organic Host Spots – advertisements that are read by a podcast host and are organically integrated into a podcast episode. These placements do tend to be more expensive as they tend to be with very specific podcasters and not as scalable as pre-produced spots.

(2) Pre-produced Scripted Spots – these are exactly as stated, when brands record commercial spots which are played during a podcast episode. These are very easy to scale through various audio advertising channels.

Additionally podcast advertisements have different placement options –

Pre-roll – ads that run prior to a podcast episode. Pre-roll can be effective when spots are short and attention grabbing (15-30 seconds). They tend to perform best across organic host spots compared to pre-produced scripted spots. For example, Joe Rogan runs up to 7-minutes in advertising prior to each episode which averages 16 million listeners. While the audience is large, we question how effective these may be as consumers may easily resort to fast-forward.

Mid-roll – ads that run during a podcast episode. Mid-roll is considered the most effective ad spots as they are statistically the least likely to be fast-forwarded by the listener.

Post-roll – ads that run after the podcast episode is completed.

What are podcast advertising rates?

Average CPM rates for podcast advertising can range from a $15 to $50 CPM, and the some of the most sought after shows can cost even more.

CPM rates also depend on the length of a particular ad spot. For example, rates may range as follows –

$15 CPM for a 10-second ad.
$18 CPM for a 30-second ad.
$25 CPM for a 60-second ad.

We recommend vetting CPM rates from a few different providers to gauge which content and pricing options work best for you.

How big is the podcast advertising market?

It is estimated that marketers will spend over $1B in podcast advertising in 2021.

Who are the top podcast advertising providers?

If you are looking to place ads in podcasts, some popular providers include –

  1. Mid-roll
  2. Advertisecast
  3. PodNova
  4. PodBean