The second annual Podcast Revenue Study by IAB and PwC confirmed solid revenue growth and significant momentum for the podcast marketplace (US). The report, done by PwC, was underwritten by 15 podcast companies who are members of the IAB, as an initiative of the IAB Audio Committee. Advertisers from financial service companies to direct brands continue to recognize the impact and value of podcast advertising.
The report included a survey of podcast companies considered to be key revenue drivers in the marketplace, who contributed data on past revenues and future projections, along with data items pertaining to ad and campaign specifics. In addition to compiling this information, the report includes a podcast advertising market sizing which delivers an independent estimate of the market in the United States, inclusive of non-survey participating companies.
Significant findings included:
- US podcast advertising revenue is expected to grow more than 110% by 2020, to $659.0 million.
- Reported revenues by surveyed companies increased 275% from 2015, the first year surveyed, to 2017.
- Host-read ads were cited as the preferred ad type, representing more than two-thirds of ads in 2017.
- Direct response ads transacted on a cost per thousand basis made up the majority of campaigns, followed by brand awareness ads (29%).
- Ads integrated or edited into programming accounted for 58 percent of the podcast ad inventory in 2017.
- A spending analysis by ad category included in the report found that financial services took the top spot with an 18 percent share, followed by direct-to-consumer retailers, which accounted for 16 percent, and arts and entertainment, at 13 percent.
Also of note, of the 14 podcast content genres measured, the top four generated more than half of the advertising revenue in 2017:
- Arts/Entertainment (17%)
- Technology (15%)
- News/Politics/Current Events (13%)
- Business (11%)
“This report confirms that podcasting is an extremely viable option for advertisers,” said Mark McCrery, CEO of Authentic and Podtrac. “More and more advertisers are discovering that podcast advertising delivers great impact for their campaigns and and repeat advertiser confidence is high with 38% of podcast ad spending coming from annual upfront buys.”
“Revenue growth equals confidence in podcast advertising as a medium,” said Hernan Lopez, Founder and CEO, Wondery. “Advertisers in every category are finding great returns on their podcast advertising and it’s reflected in growing investments.