Podcasters will be thrilled to hear that their money-making potential is reaching unprecedented levels. U.S. podcast advertising revenues are forecasted to skyrocket to more than $220 million in 2017—an uptick of 85 percent over the $119 million recorded in 2016, according to the recently released Podcast Advertising Revenue Study from the Interactive Advertising Bureau (IAB), conducted by PwC US.
The research, which covers 2015 and 2016, and offers estimates for 2017, shows that revenues have grown 73 percent between 2015 and 2016.
Findings in both 2015 and 2016 show that marketers prefer ads read by podcast hosts to those that are pre-produced. Last year saw more revenue generated by dynamically inserted ads for the first time. Direct response campaigns continue to be the most prevalent campaign type, with brand awareness and branded content campaigns increasing from 2015 to 2016. (The 2017 estimates are solely top line, and therefore cannot be broken down in detail as done with the two previous years.)
This study draws on historical data compiled directly from 20 of the industry’s largest players and encompasses all forms of podcast advertising to provide a reasonable measurement of podcast advertising growth.
This research comes on the heels of the full-year 2016 IAB Internet Advertising Revenue Report, which included the first market sizing of the digital audio space. That report showed digital audio ad formats brought in revenues of $1.1 billion, which did not include the 2016 revenues from the podcast advertising market.
“This proves two things—the whole world is listening, and brands are taking notice,” said Randall Rothenberg, president and CEO of IAB, in a news release. “From the remarkable growth of podcast ad revenue, we’re seeing an ancient axiom being proved yet again: great rewards go to those who surprise and delight their fellow humans.”
“This study is the first to directly survey the podcast industry’s significant revenue generators—which means it’s the most accurate view of the medium’s largest players compiled to date,” said Chris Kuist, senior vice president of research and impact at IAB, in the release. “We partnered with PwC US for this study to build upon our longstanding relationship in producing the IAB Internet Advertising Revenue Report, which is widely considered ‘the gold standard.’ This research carries on that tradition, with a laser focus on what is clearly one of the industry’s most dynamic areas.”
“These findings confirm that podcasting is experiencing impressive year-over-year growth, and we can expect even more gains on the horizon,” said David Silverman, a Partner at PwC US, in the release. “The study also identifies key trends that should be on marketers’ radar screens.”
The IAB Podcast Advertising Revenue Study uses the same credible and established methodology also used to produce the larger IAB Internet Advertising Revenue Report each year. PwC surveyed 20 of the largest podcast companies, comprised of leading industry publishers and ad networks. The quantitative survey asked questions related to quarterly advertising revenue, advertising delivery, and campaign type, and advertising industry category, among others. Findings were then analyzed to identify and report key trends presented in this study. Revenue estimates for 2017 are based on participating companies’ self-reported revenue forecasts, rather than actual results.