We’ve talked in the past about the growth of streaming audio and how podcasts are worth considering from an advertising standpoint. Now, recent studies and other related industry news show that if you’re not advertising on podcasts you’re liking missing a huge opportunity.
On the industry news front, streaming audio giant Spotify purchased two key podcast networks for approximately $340 million earlier this year. The two networks are Gimlet Media, which was cofounded by veteran radio reporter and producer Alex Blumberg, and Anchor, a popular podcast creation and monetization platform. Spotify already has over 200 million users, half of which are paid subscribers (meaning they pay to remove ads, download songs, and other benefits), and adding these two companies to their roster helps all three companies expand their reach.
Now, you might be thinking, if half their listeners pay to avoid ads, why is this significant?
First, ads on Spotify typically occur between songs, and that means their technology serves ads in between podcast episodes. However, podcasts advertisements are part of the stream, meaning that even paid subscribers to Spotify are exposed to them. What’s more, podcasts often command listener’s attention in a way that other digital media typically does not. Users tune in to a program whenever they want to, wherever they want to, and tend to listen to the entire episode, which can range from just a couple of minutes to episodes that last more than an hour. What’s more, they can listen at home on smart speakers, while walking around from their phones, or in their cars.
Secondly, because listeners are so engaged with the material, only about 20 percent make an active effort to avoid advertising while listening to podcasts. For this reason alone, it’s probably no surprise that podcast ad revenues have doubled in the past two years, with an IAB and PwC forecast of more than $1 billion in revenue by 2021.
Lastly, perhaps the most interesting thing about the podcast universe is its ability to “narrowcast,” meaning reaching listeners who are very narrowly segmented. However, that doesn’t necessarily diminish reach. While there’s no single source for ranking podcasts (there are a wide variety of platforms, many of which don’t publicly share their data), the top podcast producers likely reach as many as 20 million listeners, divided among the number of podcasts they produce.
So, if you’re ready to jump into podcast advertising, contact us. We can help you find the right audiences and platforms to share your brand messages.