Unveiling the mystery: Why small ad campaigns often fail to deliver ROI
Bethany Shocki
Small ad campaigns can offer a cost-effective means of reaching target audiences, but they often face hurdles in delivering ROI. Over 2,000 new brands dipped their toes into podcast advertising in Q4 2023, but few invested the necessary budgets to truly see results. Our latest blog captures the challenges brands face when running small campaigns, and why jumping into the medium with both feet might be the better way to go.

February 29, 2024

This week, Signal Hill Insights reported on the release of Magellan’s Q4 2023 Podcast Advertising Benchmark Report. The report "estimates that podcast ad revenues increased by 29% year-over-year. They counted an impressive total of 2,268 new brands coming to podcasting in Q4. The average spend of all these new advertisers? Just $20,000. In other words, a lot of brands are testing, but not spending enough to learn anything."

We love seeing so many new brands dipping their toes in the podcasting waters. We're on board—podcasting is intimate, engaging and can be an incredible marketing tool for brands to connect with potential customers! But despite careful planning and strategic execution, short "test" ad campaigns with modest budgets often lead to small returns. So, what exactly is the culprit behind these underperforming campaigns?

Limited Reach and Visibility

Small campaign budgets can translate to limited reach and visibility in today's competitive advertising landscape. With larger brands dominating ad spaces and eating up share of voice (SOV), smaller players may find themselves overshadowed and unable to capture the attention of their target audience effectively. As a result, their ads may fail to generate the desired level of exposure needed to drive meaningful engagement and conversions.

Lack of Ad Frequency and Consistency

Consistency is key in advertising, but small budgets often mean limited ad frequency and exposure. In today's world of short attention spans and information overload, it takes multiple touch-points to make a lasting impression on consumers. Without the budget to sustain a consistent presence over an extended period, small ad campaigns risk being lost amidst the noise, making it challenging to build brand awareness and drive conversions.

Insufficient Resources for Optimization

Optimization is crucial for maximizing campaign performance, but it requires time and analysis. Shorter, test campaigns may lack the necessary time to conduct A/B testing, analyze data insights, and fine-tune copy accordingly. Without the ability to identify and address underperforming elements, shorter ad campaigns may struggle to achieve optimal results.

Just Take the Plunge

In conclusion, while short test campaigns may work for direct response (DR) brands with established conversion goals and the resources to track daily performance, marketers seeking to drive brand awareness, higher recall and increased consideration should consider longer campaigns that have the frequency needed to meet those goals. To those brands we say, come on in (to podcast advertising)—the water's fine!

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