As purpose-driven ads face challenges this holiday, could podcasting provide a lift?

a box opening that says happy holidays

Purpose-driven marketing may face growing challenges for the rest of this year as consumers wrestle with inflation and the ad market gets more competitive.

While holiday-related digital ad spend is expected to hit $45 billion in 2022, according to video insights firm QuickFrame by MNTN, purpose-driven ads promoting social causes and mission-oriented brands are operating in a tough economy. Increasingly, major retailers are using ads with emotional storytelling to connect with consumers — resulting in a crowded space, as purpose-driven ads also aim to tell their stories.

An analysis by marketing platform System1 found that themes for holiday ads are shifting away from partying and glamour to focus on simple pleasures and togetherness. The five most effective ads in the study came from Hobby Lobby, Macy’s, Walmart, Etsy and USPS, which all ranked highly for their emotional storytelling, the study noted.

“With inflation high and consumers worried about the economy, it’s no surprise they’re dreaming of a quiet Christmas,” said Jon Evans, chief customer officer at System1. “As we get past Black Friday and nearer Christmas itself, we might see more charity and purpose-driven ads come to the fore, but for now it’s a more introspective Christmas ad season than usual.”

Economic insecurities

Even as more charity ads emerge, it might be more difficult for those ads to engage consumers due to the economic downturn. As QuickFrame noted in a study on connected TV holiday commercials across Facebook, Instagram and YouTube, holiday messaging results in 58% higher engagement on average compared to those without a holiday theme. However, the research also noted that consumers are coming out of several difficult years and now focusing on self care rather than philanthropy — with charity-themed ads seeing a much lower return on ad spend compared to ones in fashion, fitness and skincare.

The fact that people are feeling financially insecure does impact their motivation to give, explained Peter Prodromou, president of independent agency Boathouse Palo Alto. He contends current economic challenges will impact giving habits this year, but said he does not expect this effect to be lasting, with some of the market conditions uniquely tied to Covid-19.

“We pride ourselves on being extremely charitable, but the reality is, you tend to make these decisions based on your own personal situation,” Prodromou told Digiday. “And when you’re living with a stock market that’s whipsawing the way it has … you’re watching the value of your assets going the wrong way. People tend to pull the purse strings tighter.”

This year, there are also fewer ad dollars spread around, as digital businesses that exploded during the pandemic cut back and tech giants continue laying off thousands of workers in recent months. It has gotten harder to vie for attention in the ad market during a busy season, so mission-driven organizations and agencies need to look at this as a “brand and trust exercise” in order to win, said Steve Grant, svp of human integration at Horizon Media.

“Companies need to select their purpose with care, and then live those values internally and externally in a no-bullshit way,” Grant said. “Then that has to reach the market in product and message at a high enough amplitude and with the right positioning to have an effect … The message space in the holidays is particularly contested.”

Podcast and metaverse exploration

Consequently, more mission-driven organizations may turn to podcasting and audio advertising to find consumers in a more intimate setting. In November, the podcast advertising unit Market Enginuity Podcast Group spun out Soundrise, a new company focusing on values-driven sponsorship and podcasting. From 2017 to 2022, the podcast group said it increased annual growth by 55% in client revenue from podcast advertising sales.

Soundrise CEO Harry Clark said the holidays are the perfect opportunity for brands to “stake their claim” as more than just a product. When the marketing is done right, consumers trust the brand and potentially choose it over the competition. And podcasting, Clark added, is a good fit for these ads due to the host delivery and messaging interwoven into the content of the show.

“By connecting with consumer buying sensibilities, purpose-driven campaigns can also positively impact brands during the gifting season when consumers are thinking about giving brands that their friends and family also align with,” Clark said.

That doesn’t exclude visual ads, though, as Prodromou pointed out, “hitting people visually” lets people share the content, especially if it’s on mobile. Additionally, now there are more visually immersive opportunities, such as virtual reality experiences in the metaverse, that could help organizations tell their stories.

“I think [the metaverse] is fascinating,” Prodromou said. “If you could story tell out to potential donors, that way could be extremely powerful. … Nonprofits are mission-based by definition, so they’re trying to convey a good story all the time.”

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