YouTube wants to dominate the $2 billion podcast business. Its new audio ads can help.

Thanks to its massive library of long-form episodic content, YouTube has become a major hub for podcasts. As it looks to take a bigger slice of that multi-billion dollar industry, the video giant is introducing audio ads, which will let brands target podcast listeners on its platform.

YouTube spoke about the new product during a presentation at Advertising Week.  Tests for audio ads began back in 2020 as YouTube looked to capitalize on the pandemic-era rise in background listening. The format is launching during a boom time for podcast advertising. Earlier this year, a podcast network reported that the average CPM for its shows is $23.

The Hollywood Reporter noted that YouTube’s partners will be able to limit their audio ad buys to specific categories, such as comedy, news, and sports. Those targeted campaigns resemble some of Google’s other ad products. YouTube Select, for example, connects brands to a curated selection of channels.

YouTube is a podcasting powerhouse

A year after hiring Kai Chuk as its first Head of Podcasts

A growing number of consumers

prefer video podcasts to their audio siblings, and that’s good news for the world’s leading video company. Though rivals like Spotify have inked exclusive deals with podcasts like The Joe Rogan Experience, clips from those shows still receive millions of hits on YouTube.

The YouTube community has also produced its share of hit podcasts. The Full Send podcast, hosted by the Nelk boys (pictured above), got more than two million views in a single day when Elon Musk guest-starred. Popular video podcast episodes are able to deliver a unique combination of watch time and attention, and that’s a palpable opportunity for potential advertisers.

YouTube and its rivals are all racing to implement as many podcast monetization features as possible. Spotify lets its users self-publish and self-monetize their audio and video podcasts through its subsidiary Anchor. Meanwhile, TikTok has been its own podcast push.

A year after hiring Kai Chuk as its first Head of Podcasts, YouTube has made great progress in its audio business. It has launched a dedicated hub full of podcast episodes, and it is gaining ground on its rivals. According to a study published back in May, YouTube is the most-used podcasting platform in the U.S.