IAB Podcast Standards 2.0 takes on one of the biggest complaints about podcasts…”what is a download?”.
Oxford Road Podcast Media Supervisor, Grant Durando, explains how Oxford Road is pushing industry acceptance of the the new standards. And how those standards enable better results from shows that previously did not drive performance.
Although the IAB Podcast Measurement Technical Guidelines 2.0 (IAB 2.0) was released in December of 2017, publishers and forward-thinking advertisers are just beginning to take note of the implications and augment their practices accordingly. Those that are resisting or failing to take note and adapt are falling behind on the most important advent in podcast advertising in recent years.
Publishers in the know are currently racing to be among the first to adopt and publicize their compliance with the IAB standards. Their hope: the new system brings law and order to the purportedly chaotic realm of podcast measurement, which in turn attracts new advertisers and increases investment by existing advertisers. If IAB 2.0 is being adhered to en masse, agencies should show a corresponding increase in buying behavior. All said, by 2019, most major networks will be compliant. Advertisers that adapt to the changing measurement (and subsequent attribution and pricing) landscape now will be leaps and bounds ahead of the best of the competitive space by then.
IAB 2.0 finally addressed one of the biggest questions in podcast advertising: “What is a download?” The industry has been notoriously vague and disconnected on this topic, as measurement has historically been fractured. For some, a download is a request to the RSS feed, essentially asking for the file to be pushed to a consumer facing distribution platform. For others, a download was the requests, filtered by IP addresses according to a particular time period. For example, if the same IP address downloaded the file 3 times in an hour, this could be interpreted as 3 downloads or 1, depending on the time period being filtered for, or in IAB’s terms, ‘look-up window’.
The significant step that IAB takes with 2.0 is creating a universal look-up window of 24 hours. This reduces the range of filters which Oxford Road has seen span from 5 minutes to one week, to an objective standard. The change in look-up window allows for downloads to finally be an apples-to-apples representation of consumption (not necessarily listenership, but unique individuals downloading the file) across networks, hosting platforms, ad serving mechanisms, and distribution platforms.
Not to be ignored is another aspect of filtering outside of the look-up window, which is what IAB calls the ‘Play-Pause-Play’ scenario. This scenario is best exemplified as: a consumer starts a 45-minute podcast in the car on their way home, but their commute is only 25 minutes. So, after stopping the podcast and relocating to their house and restarting their podcast where they left off, this could, theoretically, be labeled as two ‘downloads’. IAB 2.0 dictates that this must be counted as one download, as it’s technically one unique listen.
While there is still dissension in adapting IAB compliance, some networks have taken this attempt at creating objective advertising metrics (as almost all podcast advertising is based on a CPM, or cost per impression, model, where an impression is synonymous with a download) in stride. As such, some select networks have taken adaptation in stride, and earned PR for their (and in some cases, roadmaps for) compliance. Not only is free publicity good for any media company, but these types of articles act as lead generation for new advertisers. What has historically been seen as the “wild west” of advertising is now much more enticing to sophisticated or metrics-driven companies, given the IAB standard.
“We are IAB Compliant”, moreover, could become the de facto flag to wave as a network looking for new advertisers, or one looking to add incremental advertising revenue from existing advertisers. At Oxford Road, we have begun and will continue to ask: “Are you IAB compliant?” in assessing our media buys from existing vendors, as well as investigating new vendors and properties. This allows us to do a few things. 1) Normalize tens of millions of dollars of podcast performance data in order to assign proper CPM weights to all properties. This assists with critical performance assessments of ongoing campaigns, as well as prospecting for new ones; and, 2) If the network or property is not IAB compliant, we will be advocates for compliance as soon as possible, as buying priority may start to be given to IAB compliant properties. Overall, Oxford Road does not see a drawback to networks giving IAB 2.0 compliance at least serious consideration, as we feel that it will help incentivize revenue on all sides of the ecosystem.
As the competitive, turf war podcast advertising market continues to boil, we’re constantly looking for ways to position our advertisers to get ahead. Other than the aforementioned notions of applying established, collected, and processed performance data and metrics to a normalized impression-count structure, there are higher level adaptations that any and all advertisers should be mindful of as a direct result of more widespread IAB 2.0 adaptation.
First is linked to conceptualizing the two major different pricing structures that dominate podcast advertising: Dynamic Ad Insertion (DAI) CPM and Embedded “CPM”. In the world of DAI, actual spot costs are calculated using an ad-server that records every impression that is delivered and applies a fixed CPM to that impression count. In the latter, the rate is calculated based off of a projected impression load, although the ads are not being served by an ad server. Instead, the ads are literally part of the content; theoretically indistinguishable in the audio file from the actual content of the show (as opposed to tagged with <ad stop> and <ad end> ad markers).
In the embedded case, IAB 2.0 compliance is critically important as rates are negotiated on a CPM basis and, consequently, performance is projected based on those CPMs. Although some networks don’t even guarantee a threshold of delivery in terms of downloads or proactively report back download numbers, it’s always in a network’s best interest to under-project on downloads. That biases the buy towards an advertiser’s efficient performance, even if it’s garnering slightly lower revenue for the network.
However, if the downloads that form the basis of these CPM negotiations are anywhere from 1 to 6 impressions per download, depending on the network (which are terrifyingly real ranges in the marketplace), it becomes very difficult to gauge, both from the buyer and the network side. Is a $20 CPM is fair or not? Accordingly, a $20 CPM on a non-IAB compliant property could be equivocal to a $60 CPM on an IAB compliant property (if downloads are being overcounted because of either look-up windows or play-pause-play causes). This kind of fluctuation begets more harm than good, as the marketplace will generally proceed with more caution than with a standardized marketplace, such as Nielsen rated TV or radio.
In a DAI CPM example, IAB 2.0 compliance has even more direct implications. As the total cost of DAI placements is a dependent variable to the amount of impressions served, so too is the performance for advertisers. As IAB 2.0 becomes adopted by some of the larger DAI platforms, advertisers will be able to manage their DAI buys with increased confidence, as apples-to-apples pricing comparison will be possible within and amongst networks. Additionally, it’s no industry secret that DAI has had a tough time getting off the ground as a viable and popular method of delivering advertisements for performance advertisers in podcasts.
In a previous piece, I’ve written about why that could be. One of the reasons outlined in the article was pricing. If impressions were previously counted 4x of what they should be, simply keeping the CPMs flat and adopting IAB compliance would both maintain rate integrity for truly unique downloads and improve efficiencies by 400% (e.g. turning a $100 CPA into a $25 CPA, and turning a failed campaign with limited revenue potential into a beacon of performance with ambitious revenue potential). This simple move could unlock the long-promised scale of DAI for performance advertisers.
With the tools available, it makes little sense for any properties to be outside of IAB compliance and cause this kind of uncertainty in the marketplace, as it’s rarely the case that marketplace uncertainty breeds anything more than meager revenue growth and development. At Oxford Road, we’re trying to make multiples of the market, not continue an incremental pattern of growth. 20% year over year isn’t good enough for our growth-oriented clients, and it shouldn’t be acceptable for our industry, either.