Podcast advertising is a type of marketing that is tied to digital audio files on topical subjects made available for download over the Internet. This type of advertising is non-traditional in format. It is usually compared with blog or Internet advertising in that it is a new way of reaching customers that is based on the social media phenomenon.
Traditional advertising consists of television commercials, print ads, and radio spots that are made by professional agencies and sold to major production companies. Advances in technology and the expansion of Internet access and usage since the later part of the 20th century opened up new opportunities for reaching consumers. Marketers developed advertising approaches that capitalized on the popularity of social media, the ability of ordinary citizens to contribute to the public wellspring of news, information, and ideas.
Podcasts are a type of social media that is similar to amateur- or citizen-produced radio shows. The show producer picks a topic and records a digital audio file, expressing expertise or opinion. He uploads it to the Internet so it can be heard by anyone with an interest or makes it available through podcast archiving sites for download to a MP3 digital audio player. Professional content providers can also make their audio available as podcasts, such as radio shows and university lectures.
These days, anyone with a computer and some audio content can turn it into a podcast. Podcast advertising, however, only becomes available to those podcasts that are published regularly with a substantial enough audience. The advertising format is either a full-fledged audio spot, as would be used on radio, or a sponsorship announced by the show producers.
What marketers found as they watched the development of podcasting is that because a listener takes it upon himself to look for a podcast on a particular topic, download it, and often subscribes to the show over time, he pays more attention to any advertising attached that relates to the topic of the show. The on-demand nature of the experience seems to make podcast advertising more effective in capturing attention than traditional advertising.
Media surveys consistently demonstrate that podcast audiences take some sort of action when presented with advertising attached to the show. If the ad requires a purchase, a significant percentage do so. As a result, podcast advertising generates hundreds of millions of US Dollars (USD) in revenue, though the infrastructure for getting that revenue from marketers to show producers is much less reliable than in the traditional ad market. Much of the ad revenue is directed to professionally produced podcasts, such as re-broadcasts of public radio or recorded lectures from major universities, rather than the average amateur show produced in someone's bedroom.