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Podcast ad revenue growth slows, but networks and ad platforms pitch new content and ad buying tools at IAB Podcast Upfront 

May 10, 2024
in General
Podcast ad revenue growth slows, but networks and ad platforms pitch new content and ad buying tools at IAB Podcast Upfront 
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Despite a slowdown in podcast ad revenue growth, podcast networks and ad platforms took to the stage Thursday at the IAB’s annual Podcast Upfront held in New York City to talk up new show launches, improvements in measurement and ad targeting and reaching audiences beyond audio platforms with video.

This year, the Podcast Upfront had a few newcomers, including sports media group Better Collective, conservative news publisher The Daily Wire and Good Karma Brands, which took over the operations and sales of ESPN’s radio and podcast business last July.

Another big theme of the day was podcast networks’ pitch to marketers in the audience on their ability to reach an incremental audience (or audiences that they wouldn’t be able to reach in other channels). Execs at iHeart and SiriusXM, for example, said podcasting was unique in that it was a channel people were moving to when they shifted their attention away from social platforms.

IAB podcast report shows a slowdown

The IAB’s annual U.S. podcast advertising revenue report released yesterday found that after years of double-digit growth, podcast ad revenues grew at a slower pace in 2023, up 5% year over year to $1.9 billion. That’s compared to a 26% growth in 2022 in last year’s report.

“It’s important to note that it was a challenging year for all of digital advertising due to persistent inflation and economic uncertainty that naturally impacted ad spend,” said Matt Shapo, director of the IAB’s Media Center, at the event.

The main findings:

Podcasting is projected to return to double-digit growth (12%), with revenues of over $2B this year, and on track to reach nearly $2.6 billion by 2026.

Comedy’s revenue share grew by four points in the past two years, gaining nearly 300 new advertisers in Q4 2023. It overtook news and sports as one of the most popular podcast genres.

Sports is the second most popular content genre for the second straight year, but down slightly from 15% in 2022 to 13% in 2023.

CPG and retail brands revenue was up 4% and 5% respectively, since 2022.

More than a quarter of podcasting revenues were in the “other” category, such as government, non-profit, pets and home.

Despite some of those more sobering numbers, iHeartMedia released their Q1 2024 earnings Thursday morning, which showed that its podcast revenue had grown 18% year over year to $91 million.

And Sweden-based podcast marketplace Acast earnings released on Tuesday reported a 25% total revenue growth in Q1 2024 year over year, with net sales amounting to $38.9 million. This was driven primarily by revenue growth in the North America market, where net sales grew by 48%.

Audio pushing into video and social for audience reach and discovery

It’s no surprise that podcast execs and hosts talked about reaching audiences beyond audio platforms, especially given the fact that many podcasters are consuming video podcast content on YouTube and the role of social media and short form video platforms in distributing podcast content.

Nick Viall, host of “The Viall Files” podcast, touted the benefits of video to help boost his podcast audience. A popular episode of his show drew nearly 2 million downloads – but with the help of social media assets on Instagram, and TikTok in particular, brought in 1.4 billion social media impressions, he said. 

“People will take our assets and they’ll create it into something else and it becomes this kind of domino trickle down effect and that has been invaluable” Viall said. “It’s great to hit a million downloads on an episode, but the reach is quite greater when you start investing in social media clips… There’s still a market out there [of people] who are interested in your content that might not necessarily take the time to listen to your two-hour episode.”

Podcast networks also discussed licensing podcast IP to create TV franchises – a popular tactic especially at companies that have streaming channels. Wondery (owned by Amazon) has two shows currently in production, including “Dying for Sex” starring Michelle Williams. And ESPN’s “The Sterling Affairs” podcast is being turned into a scripted series with FX, which will also come with a coinciding companion podcast, ESPN execs announced on Thursday.

Also to be expected, most of the presentations on Thursday focused on the importance of measurement and targeting when it comes to podcast advertising – though the conversation was mostly dominated by AI ad tech companies such as Seekr and Claritas (podcast networks are testing AI tools internally too to beef up their sales operations). 

NPR’s short presentation yesterday was focused on attention metrics in particular. Marc Guldimann, CEO and co-founder of Adelaide Metrics, announced an expansion to a product for publishers launched last month that can analyze ad placements in a publisher’s podcast catalog to give a “media quality” score to monetize “high attention” offerings through programmatic ad buying, he said. Launch partners include NPR, SiriusXM and Westwood One.

Additionally, SiriusXM is building a new way for advertisers to buy its shows, called “Curated Collections” and coming later this year, according to Lizzie Widhelm, svp of B2B marketing and ad innovation. It will package podcasts – such as an NBA-focused collection – so that advertisers can buy “within a specific content area, audience or creator type,” she said.

Angie More, head of advertising at Wondery, said ad spend on the podcast network can now count towards buyers’ Amazon spend. Wondery is also part of Amazon’s DSP. 

“We’re really thinking about next steps in terms of bringing those retail metrics into the fold, so that you can actually see how your ad drove action on Amazon.com. And that’s coming soon,” she added.

Acast focused its presentation on highlighting a big issue in the podcast industry: advertisers mainly buying ads in the top podcast shows, so that most of the dollars flow to the biggest shows. Because of this, almost half of Acast’s advertising revenues goes to 10% of its shows, chief business officer Greg Glenday told Digiday. 

“Only 14 of the top 100 advertisers have really done anything more than a test budget,” Glenday said onstage. But that’s changing, he noted. “2023 spend among the 10 biggest podcast advertisers grew 47%… We’re up 182% – not in revenue, but in number of shows per buy. So the long tail again – if you have 125,000 shows, you can’t just sell 500. We have to be able to sell across that audience,” Glenday added.

New shows coming this summer

A slew of new podcast shows are coming this summer.

That includes a new weekly podcast from SiriusXm, co-hosted by Woody Harrelson and Ted Danson called “Where Everybody Knows Your Name,” and slated to debut on June 12.

Paramount announced a new weekly Comedy Central podcast hosted by Jon Stewart, which will also launch in early June. Another show to come next month is from ESPN and Good Karma Brands, narrated by “The X-Files” star David Duchovny, and focused on the story of hockey player Hobey Baker.

Latinx podcast network Sonoro is working on a financial literacy podcast in partnership with financial platform Suma, as well as new shows to come from a partnership with media company “Funny Or Die.” Mario Lopez, Eric Winter and Camila Victoriano will work together to develop podcast franchises for the multicultural podcast network too.

Despite the fact that most of these networks were pitching their content for programmatic podcast ad buying, host reads were also a big focus of the day – including some expansions. Steve Raizes, evp of podcasting and audio at Paramount, said Stephen Colbert will start offering host reads on June 3, and Stewart will do the same for his upcoming show.

https://digiday.com/?p=544552

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