To accommodate the growing popularity of podcasts and the advertising potential that they provide, Spotify has created a new service called Spotify Podcasts Ads (SPA) which is powered by their new Streaming Ads Insertion (SAI) tool. 

Targeted advertising remains new ground for podcasts, and podcast advertising has remained relatively primitive compared to other online ad platforms, so this move from Spotify indicates a shift in focus towards this promising new advertising space and sets Spotify up to potentially branch out beyond its own shows and begin placing ads in other networks’ content.

With this tool, podcast advertisers for the first time will have the ability to target ads to different Spotify users and be able to evaluate their effectiveness using real-time data. As Spotify is host to an expansive list of podcasts with an estimated 35 million monthly active listeners (MAUs) of podcasts alone, there is a wealth of data ready for advertisers to tap into.

Harnessing user data 

A recent study revealed that 76% of UK podcast listeners have admitted to taking an action after listening to a podcast advert or sponsorship message, with actions ranging from researching more about the advert online, visiting a brands website and also sharing information about the brand.

As there are fewer ads in podcasts compared to other online mediums, for instance on social media, it is suspected that listeners are able to maintain more focus on the advertisements they hear on a podcast as their attention isn’t being divided between multiple competing ads. Additionally, as listeners generally have a unique and personal relationship with a podcast, a consumer may be more inclined to develop trust with a brand quicker, and therefore more likely to act on the ad. 

When using Spotify’s SAI technology, podcast marketers can target their adverts to audiences who are most likely to respond to their products/services based on their user listening habits. Since the podcasts are streamed through their platform rather than downloaded, Spotify is offering a suite of tools so digital advertisers can analyse the response to their ads and monitor listening behaviour.

Streaming vs Downloading

Spotify is in a unique position to be able to pull off this new service compared to other podcast hosting platforms, and this is primarily due to the fact it already has a wealth of data regarding its users that others simply won’t have. 

Due to a combination of the sign-up process for Spotify and access to users’ listening habits and music taste, it can more effectively personalise and target ads which in theory will increase their success.


Another interesting difference to note is that Spotify users primarily stream podcasts instead of downloading them, which allows Spotify to insert ads as people are listening and can keep track more accurately of what they are actually listening to. However, it’s important to note that this technology wouldn’t work if a Spotify user downloads an episode instead of streaming, and in this instance they would fall back on the existing ad technology that they are already using which relies on a predetermined ad.

So, what do you make of this update? Is this something you would consider? If you’d like to read more of our predictions for this 2020, download our free innovations ebook now: http://bit.ly/innovations-ebook

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