The Underestimated Power
of On-Demand
Audio

5 article number 5

Rediscovering the Human Voice in the Age of Digital Distraction

John Stalle

Before you read this article, I want you to do one thing: Spend two minutes on your phone using your Facebook app.

Done? Good.

In the time you spent on Facebook, chances are you read a news story or watched a video. These are common activities on social media, yet there is something about them that I find particularly puzzling: How little time we spend on each of these activities.

Here is my point. As on any major social media platform, the news feed experience is one that is highly personalized and yet inherently ephemeral. According to a recent Pew study, Facebook users spend an average of only 107 seconds reading long-form articles. Add in a video, and you’ve just spent a little over two minutes on Facebook consuming two different pieces of content.

So why then, when we spend almost a third of our online time on social media – where we go to not only connect with friends, but also to consume news and entertaining content – does each piece of content fail to consume more of our attention?

The answer, as it turns out, can be found in the science of our mind.

Each time we share, like, or comment on a post online, our brains release a nice little shot of dopamine, otherwise known as the “reward molecule.” This positive feedback loop is pretty powerful and, as it turns out, plays a large role in explaining why we’re constantly scrolling, looking for what’s new, what we can share, what we can find to feed our need. So, despite taking up a third of our online time in social media activities, news content in our feed doesn’t always captivate us or engage us in longer time spent or deeper consumption.

A user enjoying his podcast.So what does? If we’re looking in digital, we need to look outside the social feed – away from the digital distractions associated with its dopamine-laden feedback loop – and to a medium that captures attention like few other types of digital media.

That medium is on-demand audio, where incredible stories abound in the form of podcasts, segments, and stand-alone stories or clips. In 2017, this emerging medium – which has grown dramatically in the past year driven by consumer trends and developments within the on-demand audio industry – will become a mainstream media channel and a more common part of the content diet for audiences.

But why now? What is overcoming on-demand audio’s long-standing inability to gain traction among consumers, as both on-demand video and music have themselves seen meteoric adoption rates over the same time period?

To start, let’s look back at one of my early podcast experiences…

As I recall, the episode was “American Football” by WNYC’s Radiolab. Unlike a story that I would have skimmed on social media, this episode had me spellbound for over an hour as hosts Jad Abumrad and Robert Krulwich recounted the history of football and how it came to be the most popular sport in America.

Since then, my affinity for these rich, well-told stories has only grown, and the podcasting industry has grown right along with it. As I (like my podcasting heroes at Radiolab) dug into the history podcasts, I began to discover dots that, when connected, began to paint a picture that looked a little bit like this:

Podcasts and other audio content are attracting more and more users.

Over the past few years, these dots have grown increasingly bright.

In 2014, podcasting began to reach mainstream consumers, as quality podcasts from stations such as NPR, WNYC, and WBEZ proliferated, with “Serial” becoming the first podcast in iTunes history to reach 5 million streams or downloads.

In 2015, podcast hosting provider Libsyn hosted a record 28,000 shows and received over 3 billion download requests.

And in 2016, the Interactive Advertising Bureau (IAB) released its much-anticipated guidelines on podcast advertising, which will help standardize metrics for this medium.

The bottom line? Podcast content is better than ever, consumers (by way of increased downloads) are responding, and the IAB has finally given its nod of approval to this emerging medium.

But that’s just the tip of the iceberg.

With the podcast advertising market expected to top $200 million in 2017, there are several powerful trends that will make podcasts a prime destination for brand storytelling in 2017 and beyond. As you will see, these developments represent the biggest dots that podcasting has long been missing and that are now finally coming into focus.

So let’s dive in.

Demand for On-Demand Entertainment Accelerates

Over the past few years, mobile device penetration and increasing Internet connection speeds have led to a surge in demand for on-demand entertainment. In 2016 alone, nearly 79 percent of U.S. users will access the Internet regularly via a mobile phone, with 61 percent subscribing to video on-demand (SVOD) services such as Netflix, Hulu, and Amazon Prime Video. When it comes to on-demand audio, these figures are consistent, as 71 percent of listeners access podcasts via mobile devices.

And this demand for mobile entertainment doesn’t just apply to smartphones and tablets – it applies to connected cars too. By 2020 there will be an estimated 220 million connected cars on the road, and in the meantime, consumer preference is already becoming significantly impacted by connectivity.

Take, for instance, China. As a country that is arguably poised to lead the world in connected car and autonomous vehicle innovation, we can already see that more than 85 percent of Chinese customers in the low-cost/high-volume car segment are “willing to switch to a different brand of car if it offers more connected features at a reasonable price.” For perspective, that’s even more than they care about the car’s design or performance. Seriously.

With entertainment among the most-desired features of Internet-connected cars, on-demand audio has the opportunity to finally disrupt the radio industry by stealing away listenership in the car (where an estimated 44 percent of all radio listening takes place), much in the same way subscription video on-demand finally surpassed DVR penetration in 2016.

New Entrants Disrupt Podcast Discoverability

Since the introduction of podcasts in the early 2000s, Apple has commanded an outsized share of the app market, with 60 percent of podcasts downloaded via iTunes and the iOS Podcasts app. While it’s viewed as a supportive member of the podcasting industry, it’s done admittedly little to improve the discoverability of the over 300,000 podcasts found on its store.

Other players within the space, however, are actively working to address the issue. Panoply, NPR, and WNYC are all working hard to develop app functionality that makes podcasts more discoverable through curated playlists and personalized recommendations. While these companies work to solve the discoverability problem, Spotify is also beginning to enter the space, as it began to feature podcasts more prominently in the summer of 2016, and has the opportunity to leverage features of its Discover Weekly technology to provide tailored podcast recommendations.

Podcasters Explore New Media to Fit the Social Feed

In addition to improving discoverability, podcasters are also beginning to explore new methods of distributing their podcasts across social networks such as Instagram and Twitter. Recent examples include WNYC’s audiograms and This American Life’s “Shortcut,” both of which take snippets of podcasts and turn them into animated videos that can be shared on social media. As new entrants continue to improve podcasts’ discoverability, these emerging media formats could help expose podcasts to a wider audience of listeners.

Measurement and Dynamic Ad Insertion Become a Reality

Over the years, publishers and advertisers’ biggest frustration with on-demand audio has been the lack of data and ad serving capabilities within the major podcast marketplaces. Podcast networks such as Panoply and Acast, however, are hoping to change this, as both are introducing products that will capture richer data to help brands understand consumers’ listening habits, including session duration, geographic location, and software and device usage.

In addition, these firms are working to deliver dynamic ad insertion capabilities, which will allow advertisers to insert ads into shows (both new and old) on the fly, serve different ads to different audience segments, and report on ad listening metrics that can improve both programming and ad targeting.

Big Brands Begin to Join In

More than a million people downloaded GE’s “The Message,” earning the podcast the #1 slot on iTunes.
More than a million people downloaded GE’s “The Message,” earning the podcast the #1 slot on iTunes.

In addition to improved advertising metrics and dynamic insertion capabilities, recent data from Podtrac shows that podcast advertising has resulted in ad effectiveness unequaled in other digital advertising channels, generating “62 percent average unaided ad recall, an 81 percent average increase in product or service awareness, a 187 average increase in usage intent, and a 69 percent average brand favorability rating.”

Given this kind of performance, it’s no surprise that big brands such as Dell, Target, and American Express are entering the space with sponsored messaging. In addition, some brands are even going so far as to create podcasts of their own.

GE, for instance, has created a podcast called “The Message,” in which a fictional character is charged with decoding a message received from outer space. Throughout the series, mock interviews and reports give the fictional series a journalistic feel, while GE technology is incorporated into the narrative to help the protagonist decode the extraterrestrial message.

What This Means Moving Forward

Given consumers’ shift to mobile, increased desire for on-demand entertainment, and improvements within the industry, podcasting has finally reached a place where it should demand consideration within brands’ digital media consideration set.

Although it has been a long time coming, the medium has always contained one of the most powerful storytelling devices that brands can employ: the human voice. Unlike other digital media, which induces viewers to skim or skip content in favor of the new and the next, on-demand audio is a format that focuses viewers’ attention and consequently helps foster their unbound imagination.

Brands that can fuel their audiences’ imaginations with timely and relevant storytelling will be well prepared to endear themselves to consumers in 2017 and beyond.

 

  • John StalleJohn Stallé

    Digital Strategy 
    Since joining The Richards Group, John has executed comprehensive social media, content marketing, and digital media strategies for clients such as Charles Schwab, KeyBank, and Orkin.

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