'The Joe Rogan Experience' helps Spotify win $20 million deal with Omnicom
Omnicom Media Group is committing $20 million for podcast ads on Spotify for the remainder of the year, saying that the company's exclusive rights to "The Joe Rogan Experience” podcast played a large part in closing the deal.
“Everything starts with content,” Catherine Sullivan, chief investment officer at Omnicom Media Group North America, told Ad Age. “The deal with Joe Rogan certainly fueled a lot of the momentum behind [our decision], and the ad tech was the piece that brought it all together for us.”
Omnicom agencies including Hearts & Science, OMD and PHD will have first dibs on available podcasts through Spotify. The holding company will also help improve capabilities, including targeting, reporting and measurement, on Spotify's platform. Omnicom manages $35 billion in global media spend and counts Procter & Gamble, AT&T, Pepsi, McDonald’s and State Farm as clients.
Sullivan says the deal doesn't preclude the holding company from advertising on Spotify rivals such as Pandora, but says it studied the audio category and “felt the assets Spotify had made the most sense for our clients.”
“We were going to make a bet and we felt we needed to, because when you represent clients like State Farm, Pepsi, McDonald’s and AT&T, the expectation is you are going to have first look at all this type of content,” says Sullivan. “Between the two, we felt [Spotify was] the right choice for the client base we represent.”
The deal underscores Spotify’s ambitions to be the next major channel of addressable media—what Spotify executives describe as, “the Facebook of digital audio ads.”
The company has amassed a war chest of podcasting content through acquisition and exclusive deals that include Gimlet Media, Joe Rogan, Bill Simmons and the entire DC comics catalog to bring scale to its platform. While tools such as measurement, targeting and engagement are commonplace in other channels including digital video, they’re relatively new technologies that Spotify has introduced to clients including OMG.
Sullivan says addressability was also critical in closing the deal with Spotify. “Audio has worked really well for our clients and we have seen tremendous results,” she says. “But what was missing was the addressability.”
Recent figures from the Interactive Advertising Bureau show that more than $678 million was spent on podcast advertising in the U.S. last year, up 42 percent year-over-year. That figure is expected to climb to $1 billion next year, the IAB says.