According to IAB’s U.S. Podcast Advertising Revenue Study, prepared by PwC (PricewaterhouseCoopers) and released at the IAB 2021 Podcast Upfront, podcast advertising will grow as much in the next two years as it did in the past decade.
Driven by a particularly strong fourth quarter (+37% YoY), podcast advertising revenues climbed to $842 million in 2020, up from $708 million in the year prior.
“Podcasting will grow in the next two years by leaps and bounds,” said Eric John, Vice President, IAB Media Center. “Podcast listeners have shown that – even when working from home – podcasts are a preferred medium. Advertisers are benefiting from new technologies developed to serve these marketplaces, to make podcast advertising more dynamic and measurable than ever before.”
Podcast publishers were well-positioned for the quick pivot, with the leading audio platforms steadily investing in new content and buyer-friendly ad tech. In particular messaging agility, enabled by dynamic ad insertion, made podcasting especially attractive in an unpredictable year. Marketers valued the ability to quickly switch out messaging as-needed: dynamically-inserted ads, which enable ad placement at the point of listener download, increased share of revenue from 48% to 67% year over year. Announcer-read / pre-produced ads, which also put more control in buyers’ hands, increased share from 27% to 35%. Host-read continues to represent over half of the revenue by ad type, which illustrates buyers’ desire to tap the direct, influential relationship creators have with their listeners.
Perhaps the most important shift is that brand advertising (45% of 2020 revenue) is approaching parity with direct response (51% of 2020 revenue). Bigger brands are discovering that podcast advertising can work across the sales funnel.
- At 76%, mid-roll spot placements continued to account for three-fourths (76%) of revenues.
- Half of podcast ads lasted longer than 30 seconds in length. Seller Perspective: Longer ads allow for creative storytelling.
- News continued to be the top content genre for podcast advertisers (22% market share.) Seller Perspective: Advertisers should be leaning-in to News.
- Direct-To-Consumer brands maintained the top advertiser category market share (19%), while Pharmaceuticals more than doubled in share YoY (9%). Seller Perspective: Bigger brands are buying in.
“The big takeaway from consumer behavior pre, during, and post pandemic is that podcasting has tremendous growth ahead. Consumers love listening and will integrate it into they live whenever it fits. Advertisers love the flexibility to adjust their messaging on the fly. And most importantly, brands are continuing to shift to podcasting simply because it works: when they run an ad, the cash register rings,” said John.
For the IAB Full-Year 2020 U.S. Podcast Advertising Revenue Report, click HERE.