Podcast advertising revenue is expected to pass $1 billion by the end of 2019, according to figures from PwC’s Global Entertainment & Media Outlook 2019-2023.
Between now and 2023, podcast advertising is expected to grow 23.1% to hit $1.4 billion, which is double the current global figure of $0.7 billion.
The report’s segment findings on music, radio and podcasts also notes a number of other significant milestones on the horizon for podcasts, with advertising revenue for the format expected to exceed digital newspaper circulation revenues by 2022.
Smart speakers are expected to play a part in this. As more people adopt them, they will boost podcast accessibility, especially as 58% of people listen to podcasts in the home.
The double-digit growth is down to a number of factors. Increased confidence in podcasting and podcast audiences is vitally important, with high-profile acquisitions and investments by companies like Spotify boosting advertiser interest.
Better analytics is also a factor, although there is still a way to go on what analytics can be gathered. Apple has been instrumental in this recently, with the launch of their in-depth podcast analytics demonstrating that listeners are typically getting through 90% of an episode, regardless of the length or genre of the show.
Podcast listeners really are the hyper-engaged, super-supportive audiences that everyone hoped.WIRED’s Miranda Katz
The other factor likely to drive ad revenue growth over the next few years is the increasing number of podcasts using programmatic ad insertion in episodes, rather than ‘baked in’ ads that are encoded into the podcast’s audio file, which currently accounts for 51.2% of all podcast advertising.
Dynamically-inserted ads may not work for everyone, but they have increased from 41.2% of all podcast ads in 2017 to 48.8% this year, thanks to a number of podcast hosting platforms offering these types of ads.
PwC’s report notes that podcasts feature far fewer advertising minutes than radio, with podcasts having two minutes of adverts per hour compared to radio’s ten minutes per hour on average. Despite this, advertisers still seem willing to pay a premium for podcasting’s more engaged audiences.
Whether loyal audiences will tolerate more minutes of advertising in podcasts as they continue to grow remains to be seen, but for the moment, the future of podcast advertising looks very bright indeed.
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