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Spotify's surprise rollout of a feature allowing users to skip ads more easily on podcasts has sent shockwaves through the industry, but so far, the concern appears to be overblown. The test feature, which has been rolled out to a select group of paid subscribers, surfaces a "skip ahead" button for users who have the app pulled up when they arrive at segments including ads, promotions, intros, outros, and baked-in sponsorships. While the move has sparked a flurry of calls between advertisers and podcasters, industry members are saying that the impact on podcast advertisers is likely to be minimal.
Background & Context
The test feature is part of Spotify's ongoing efforts to improve the user experience on its platform. Paid subscribers, who already listen to music ad-free, will now be able to skip ads on podcasts with ease. The feature does not apply to ads that are sold specifically by Spotify, and it's worth noting that Spotify's premium users have been able to listen to music ad-free for some time.
The rollout of the feature has sparked concerns among podcast advertisers, who worry that it will lead to a decrease in ad revenue. However, industry members are pointing out that ad-skipping is not a new phenomenon, and it's already available on other audio platforms like YouTube. The real question is whether the feature will have a significant impact on podcast advertisers, and so far, the answer appears to be no.
Key Details
The feature allows users to skip ads on podcasts with a single click, but it doesn't impact ad delivery. The ads are still technically delivered, even if a user chooses to skip them. Dan Granger, CEO of Oxford Advertising, which is the world's largest podcast advertising agency, says that he hasn't seen advertisers pull back in spending. In fact, most advertisers are adopting a "wait-and-see" approach to see how the feature affects actual ad listening.
Greg Glenday, CEO of Acast, a podcasting hosting, distribution, and monetization platform, says that there has been some pushback from select podcast creators on the new measure. However, he points out that ad-skipping is not new to the audio medium, and Acast's own internal metrics show that only about 10% of users actually choose to skip ads. Glenday also notes that podcast ads have some of the highest effectiveness and outcome scores in the media mix, so he doesn't think this is a material issue at the moment.
What Experts Say
Industry experts are saying that the feature is unlikely to have a significant impact on podcast advertisers. Granger notes that ad-skipping is maybe scarier in theory than in practice, and that he doesn't think this is going to have major material direct impact on the brands that advertise. Glenday agrees, saying that as long as podcast creators treat their audience with respect and regard ad load and tone, they will accept ads and support their creators.
Key Takeaways
- The feature allows users to skip ads on podcasts with a single click, but it doesn't impact ad delivery.
- Industry members are saying that the impact on podcast advertisers is likely to be minimal.
- Only about 10% of users actually choose to skip ads, according to Acast's internal metrics.
- Podcast ads have some of the highest effectiveness and outcome scores in the media mix.
What This Means For You
For everyday listeners, the feature is unlikely to have a significant impact on the podcasting experience. However, for podcast creators and advertisers, it's worth keeping an eye on how the feature affects ad revenue and listener engagement. If you're a podcast creator, it's worth considering how you can adapt to the new feature and ensure that your audience continues to engage with your content.
Ultimately, the feature is a double-edged sword for podcast advertisers. On the one hand, it may lead to a decrease in ad revenue. On the other hand, it may also lead to a more engaged audience, as listeners are forced to interact with ads in a more meaningful way. As the feature continues to roll out, it will be interesting to see how podcast advertisers adapt and how the industry as a whole responds.
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