Rory Sutherland: 'Programmatic is a load of bollocks' and what’s wrong with podcast ads

Rory Sutherland, vice-chairman of Ogilvy, can often be relied upon for a quotable comment that gets straight to the point. That was certainly the case on his panel titled “What’s wrong with podcast advertising?” at The Podcast Show 2024.

With celebrity stars and industry greats walking the halls of London’s Business Design Centre last month, Sutherland was one of the most sought-after speakers. 

The Ogilvy head is also host of the podcast On Brand with ALF & Rory Sutherland.

Sutherland explained to Campaign the issues that advertisers have with podcasts and why “programmatic is a load of bollocks”.

He said: “I think the obsession and quantification of programmatic [advertising] is a load of bollocks. It's the wrong match being used to optimise the wrong thing in the wrong time frame.”

Sutherland also explained that he would expect digital advertising, including podcast ads, to be vaguely proportionate to where he spends his money. But, he said, this is not the case. 

“We’re setting advertisers a too high burden of proof,” he told Campaign. Sutherland criticised the over-emphasis on predicting the return on investment of campaigns and how this, in turn, harms advertising placed on formats where defining the customer base is so important, like podcasts.

“Merely determining the value of marketing activity on the basis of short-term interactions is a fool's errand. It's a misalignment," he said. 

“You end up with an absurdity where you start defining your customer base simply by those people who are prepared to interact with you cheaply. That is not by any means a full and fair description of who your potential customers might be.

“This has been sold by the exceptions of this world – the tech companies. It's absolute bullshit. ROI is completely the wrong measure to use for marketing expenditure.”

It is for this reason that Sutherland believes digital advertising is “completely broken” and this is where podcast advertisers are going wrong.

He said on the panel: “The whole system of effectively using immediate ROI – based on clickthrough [rates] and track through to purchase as the single leading metric for your activities – is bonkers. It's deranged.”

So are UK agencies and brands taking podcast advertising seriously enough?

“No,” Sutherland said. “But it's not the creative agencies.

“Historically, agencies did both media and creative. It was a bit like a restaurant, you got people in for the food and you made money on the drink. You got people in for the creative and made money on the media. 

“Then the people who sold the drink – the media people – were allowed to go and open a wine bar next door. They've successfully effectively turned their clients, in my view, into programmatic alcoholics.”

His advice, when it came to doing podcast advertising successfully, is to copy those that do it well. He referenced VPN advertising, which is frequently advertised in podcasts. 

“My argument would be,” he told Campaign, “they probably know what they’re doing. So if you’re in a similar category – high lifetime value and large upfront costs – copy them.”