IMV16 : Podcasting

The following is a transcript for IMV16 : Podcasting. The original podcast is located here.

Announcer:

Welcome to the Internet Marketing Voodoo podcast brought to you by MindComet. And now, here's your host, Ted Murphy.

Ted Murphy:

Welcome to Internet Marketing Voodoo episode 16. I’m your host, Ted Murphy. And with us today is Mike Chapman, editorial director for eMarketer. Welcome to the show today, Mike.

Mike Chapman:

Hi, Ted.

Ted Murphy:

Mike, we’re here to talk about the podcast market. And obviously, many of our listeners are listening to this show today via podcast. But I’m not sure that all of them understand exactly how it gets to them, so I was wondering if you could off by giving our listeners a brief overview of what a podcast is.

Mike Chapman:

Of course, yeah. There’s a little bit of irony there, of course, a podcast about podcasting. I guess a good definition that I heard was podcasting was once described as time shifted digital audio, so think of TiVo, but for your iPod. And the power of podcasting really comes from the ability of the listener to choose when and where they listen to the content. Essentially, the mechanism is using an MP3 player, or an iPod is a predominant device at the moment, get a syndicated flow of audio content. It can be music, but generally, it’s talk-based content. And it’s syndicated and they get the latest episode or the latest edition every time they synchronize their MP3 player with their computer.

Ted Murphy:

And obviously, a lot of that also comes through iTunes. I know that a lot of our listeners actually subscribe through iTunes. And basically, what that is is just an easy way to subscribe to that podcast.

Mike Chapman:

That’s right. In fact, an interesting point there is that really, podcasting only exists because of the efforts of Apple. The technology to do it has been around for quite a few years. It uses RSS syndication software and MP3 audio files and small players that can play them, and all of that’s been around for a long time. In many ways, it’s only because of iTunes that podcasting exists.

Ted Murphy:

So how large is the podcast market?

Mike Chapman:

In terms of audience, I guess that’s certainly for a marketer, that’s going to be the most interesting variable, but eMarketer estimates that in 2006, there is probably a total audience of around 10,000,000 listeners. An important point to remember is that that’s 10,000,000 people who listen to podcasts at all, or who have ever listened to podcasts. For marketers and advertisers, a much more interesting audience is the audience of people who listen to podcasts on a regular basis. And looking around at the various indicators and various research firms, I have put the active podcast audience—the number of people who listen to podcasts at least weekly—at around 3,000,000 in 2006, probably rising to about 15,000,000 in 2010.

Ted Murphy:

And I know that you actually recently released a report entitled Podcasting: Who’s Tuning In? That’s available from eMarketer. Is that correct?

Mike Chapman:

That’s right, yes. You’re looking at the marketing advertising opportunity that relates to podcasting, specifically.

Ted Murphy:

You mentioned marketers. And obviously, a large part of our audience is people in advertising and marketing. The biggest thing that they’re often looking at is for reporting purposes, how do you describe the average reach of a podcast? What should I be looking for? Are there ways to measure the effectiveness of podcasts? They want to know is this something that I should be evaluating as part of my marketing mix.

Mike Chapman:

Yes, that’s a very interesting point, obviously, for anyone trying to reach an audience is how large is the audience and how successful are their efforts to reach them. It’s very difficult to gauge at the moment, because a majority of podcasts are subscribed to via iTunes and Apple are not incredibly generous with their usage numbers, so finding out exactly how many people subscribe to or listen to a particular podcast is tricky at the moment. But an important point is that iTunes will not remain the predominant source of podcast subscriptions for very long. In fact, another services called FeedBurner distributes as many podcasts as iTunes already, so measurement is going to be something that becomes easier and easier. But at the moment, it’s actually quite difficult to track how many users subscribe to a podcast.

Another point that makes that awkward is that the level of listenership varies hugely, depending on the subject. And in some ways, that’s the strength of podcasting in that it allows messages, or it’s a way to get to very small niche specialist markets that you couldn’t otherwise engage with. It’s kind of an evasive answer, but it’s actually something of a constraint on podcasts to advertising marketing at the moment that it’s difficult to gauge. Unlike, say, putting text ads or banner ads on a website, it’s very difficult to get direct statistical information on how many people have listened. It’s not impossible and there are several companies who have set up businesses based entirely on helping podcast broadcasters, podcasters and advertisers measure these things, their listenership and the response rates and so on. It’s not impossible, but it’s not as simple as, say, it would be with regular web advertising.

Ted Murphy:

And I know that actually for this podcast, the way that we get around the iTunes issue is we actually use FeedBurner and we use FeedBurner’s RSS feeds to feed to iTunes. And FeedBurner will provide all of the statistical information that we need to be able to see who’s viewing our assessed feeds and how they’re actually getting those, whether it be through iTunes or through some other RSS reader or content syndicator.

Mike Chapman:

Exactly and very quickly, I mean within literally the next six months, all sorts of ways around that will arise, and it’s not going to remain a constraint on the medium or advertising marketers who are clearly very driven to get usage numbers and listenership data.

Ted Murphy:

So it seems that a lot of people focus on Gen Y as the assumed market for podcasts. Everybody thinks it’s a bunch of 20-somethings and teenagers that are running around with their iPods listening to these podcasts. Is that true?

Mike Chapman:

At the moment, that’s definitely true and extends from the fact that to be a regular podcast listener, you have to get an iPod, have an Internet connection, be comfortable with synchronizing your iPod with your PC. And those are not incredibly technical feats, but it definitely filters the audience pretty quickly so that you’re looking at, certainly at the moment, at the early adopters, and early adopters with this kind of gadget-based Internet technology, or generally, young males age 18 to 34 or, you know, that kind of range. The definition of Gen Y is what, 18 to 28 or something.

Ted Murphy:

Twenty-eight, twenty-nine.

Mike Chapman:

That’s right, yeah. Yeah, so for that reason, right now, yes, that’s definitely the demographic that dominates the audience. That is something that’s going to change, because like all new technology or new media, it will filter out into a broader population. Right now, that’s not a problem. That’s a very desirable audience, a very desirable demographic for advertising marketers. Another important characteristic of the audience is that they have enough money to buy an iPod and have a PC connected to the Internet, which is another appealing characteristic.

Ted Murphy:

What about in terms of people listening on their desktops? I know I’ve seen a bunch of different reports in terms of people that are just downloading them to their computers and listening while they’re at work or anything else like that. Do you have any information in terms of those listeners in your report?

Mike Chapman:

No. Actually, I haven’t dug out a breakdown. I think it’s probably quite a substantial number. The key thing to remember is that it’s the portability and listening to the content you want whenever and wherever you like that defines podcasting in many ways. Those listening on a PC aren’t really doing anything much different than browsing the Internet, in that they’re downloading files when they want onto their desktop or their computer.

Ted Murphy:

What are a few popular podcasts, and what do you think makes those podcasts popular?

Mike Chapman:

I don’t have a sort of list of the top 10 of the greatest hits, but one that is a classic and I think will always be sighted as one of the founding podcasts is the NPR podcasts that are put out daily. Obviously, that’s public radio programming that they also convert to podcast format. And that is the single podcast that has the highest listenership. I’m not sure of the exact numbers right now. And it’s the podcast that is attracting advertising and sponsorship very enthusiastically at the moment.

Ted Murphy:

Speaking of advertising and sponsorship, are you seeing that advertisers are paying for commercials within podcasts outside of the big names? Are they looking at the niche power of podcasts and saying, “You know what? This is a podcast about people that are really into cameras.” Are you now starting to see that advertisers are saying, “Yeah, that podcast is all about cameras and that’s where we should be”?

Mike Chapman:

I’m not seeing the dollars changing hands right now, but definitely seeing a kind of—well clamor is perhaps overstating—but definitely a demand for information of that sort. That definitely, advertisers and marketers who want to get to that kind of select market are trying to find out how they do it. And that’s why several companies have sprung up that provide that kind of service, saying to potential advertisers, “If you want to reach a very specific demographic through podcasts, we can help you do it.” Most of the money that’s being spent right now is much broader sponsorship arrangements, not specific ad slots within that specific podcast. The automotive industry, for example, has done a lot of sponsorship. The NPR podcasts have attracted a range of sponsors over the past few months, like EarthLink was one of the big sponsors for a while.

Ted Murphy:

What do you think the advantages are of integrating podcasting into the marketing mix?

Mike Chapman:

I think a clear advantage is that the demographic that is enthusiastically subscribed to podcasts is the demographic that’s becoming more difficult to reach through traditional advertising channels such as television. It’s the exact demographic that’s migrating away from TV. So very broadly, that means that podcasting is appealing to the advertising market if you want to reach that demographic. As time goes on, and very quickly, as podcasting becomes a larger medium, the long tail idea of reaching niche markets very efficiently makes it a very appealing medium in my mind. I don’t think that it’s going to become a new mass medium, and I do think that we ought to be careful, because the whole convergence movement, the force that’s sort of pushing everything towards a point where it’s not really going to matter what device you listen to your content on, or what device advertising marketers put out their messages on is going to mean that it’s going to become very cloudy as to whether something is a podcast, or whether it’s content that someone is downloading to their phone every day. So that’s why I think something to bear in mind about advertising marketing on podcast, there is an argument for waiting for a few months to see how it evolves. If Motorola and Akea have launched phones that connect to the Internet with the same storage capacity as an iPod, then the two things really aren’t any different.

Ted Murphy:

In terms of podcasting, we’ve talked about two things here. We’ve talked about maybe buying advertising inside of a podcast, and then we’ve also talked about maybe creating a podcast. Let’s assume that I’ve created a podcast on a topic that’s relative to my company and my industry. How do I distribute that podcast? And do you have any tips in terms of getting listeners to subscribe to the podcast, maybe offering exclusive content or special incentives? What are you seeing there?

Mike Chapman:

Content is definitely king. Podcasting at the moment is a little like the Internet was in the mid ‘90’s. It’s seen as information must be free, and it’s seen as a way of podcasters communicating with an audience without the intervention of high setup costs or a publisher. So people who are listening to podcasts are really, really strictly looking for content that they are directly interested in and that they find defined elsewhere. It’s definitely the content that drives listeners at the moment. And the way to broadcast the fact that you have this content is through sites like FeedBurner and like iTunes. And as I’ve mentioned, there are companies being set up that help other companies communicate the fact that they have a podcast on particular issues that will market podcasts, in effect.

Ted Murphy:

In terms of brands that are using podcasts right now, I know that Nike and Disney have been in the game for quite some time. Are there any other brands that stand out to you in particular?

Mike Chapman:

Yeah. There’s quite a collection of automotive companies that have adopted it, probably because they are very keen to get to that particular demographic that’s adopting podcasts, so Audi and Honda, in particular, have been quite active in the podcast area. And Whirlpool was another one that’s sponsored a high profile series of podcasts. Honda actually produced their own and produced content that was entertaining, but was also about their products, and they published it at their website and allowed people to download it to their iPods. That was quite successful and they’ve acquired a good reputation for the quality of the content.

Ted Murphy:

It seems like any time a marketer gets used to using a new technology and it gets over that initial hump of acceptance that something new comes along. And I think we’re actually starting to see that already with podcasting. I know that you’ve said that it makes sense to wait a little while and see what happens, but already now from podcasting now, we’re seeing videocasting. So what does that mean?

Mike Chapman:

Videocasting really is the reason that podcasting has attracted the attention of advertising marketers at all, because like television advertising, being able to broadcast a message with moving images is much more powerful and much more appealing. And it’s because of the advent of videocasting, which in turn was triggered by Apple’s release of an iPod that would support good quality video, it’s because of that development that podcasting is seen as something exciting for advertising marketers at all. Videocasting is essentially the same thing. It’s a syndicated stream of content that has pictures with it, as well as sound, very simply.

Ted Murphy:

So what do you think the future holds for podcasting? Do you think that it’s going to become a more widely accepted media channel?

Mike Chapman:

That’s a very interesting question. It’s definitely something that advertisers and marketers should follow closely. The whole concept of convergence, I think, will muddy the waters, but I think following the evolution of podcasting will put advertising marketers in a good position to take advantage of this type of digital media. However it’s being consumed, advertising marketers are in a strong position to take advantage of it. I don’t think that podcasting in itself is going to become a new mass medium, but there is definitely something very powerful happening with radio, and digital audio, and the radio model, and Internet radio. I think radio in the U.S. has an audience of something like 200,000,000, something incredible. And I think podcasting, Internet radio and radio together are going to evolve into something that is quite an exciting opportunity for advertisers and marketers. The real thing to watch is this convergence of technologies. If there’s little distinction between a phone and an iPod or Microsoft’s MP3 player, then really, in some ways, podcasting might go away as a concept.

Ted Murphy:

So Mike, all that being said, what are the top three things that marketers should know about using podcasts for marketing purposes?

Mike Chapman:

Top three. I’m going to make these up as I go along. One of them is keep it simple. Right now, it’s just so nascent that it’s something that will have to be done by intuition more than by the kind of metrics that we’ve gotten used to with online advertising. So small sponsorship deals on a monthly basis, rather than some arrangement where an advertiser or marketer is paying per download would definitely be a good ground rule to go in with. Secondly, look at the podcasting space of FeedBurner and iTunes and see the range of podcasts that are being made available, and if derive from that some idea of whether the audience is one you really want to get to, well it becomes strange how complex it is. And you want to make sure that the audience that you’re trying to reach is one that delivers the payback to the extra effort it would take. And I don’t really have a third one. Those would be the two rules that I’d follow.

Ted Murphy:

That’s a first. Well Mike, it’s been a pleasure having you on the show today. And hopefully, we can have you back on the show again in the future. For all of those listening to Internet Marketing Voodoo, if you have any questions, please feel free to call us toll-free at 866-206-4461. Mike, we’ll talk to you again in the near future.

Mike Chapman:

Absolutely. Thanks a lot, Ted. It was pleasure. Talk to you soon.

Ted Murphy:

Thank you.

Announcer:

For more information on this week's topic, visit http://www.InternetMarketingVoodoo.com. This podcast has been brought to you by MindComet, the Relationship Agency.

[End of Audio]

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