This year, the U.S. podcast advertising industry is already seeing notable growth and will continue to do so for the rest of the year, compared to the ad spending for any other audio formats. In fact, according to estimates, the podcast ad spend will grow by 10.4 percent, to $782 million this year, compared to the 17 percent drop for other digital radio outlays in general.
This year, podcasts are going to be making up around 21 percent, or one-fifth of all the digital radio ad spend
That’s a noticeable jump from the 4.1 percent share that it had only five years ago, in 2015. Additionally, this growth is only going to become bigger next year, and it’s estimated that it’s going to increase by 44.9 percent, which means it’s going to reach $1.13 billion in ad spend. At the start, and during the pandemic, the ad rates for podcasts experienced a comparatively and relatively low decrease, because the interest in this popular format has remained very high.
The International Advertising Bureau (IAB) surveyed digital ad sellers, and the results showed that podcasters only expected a 6 percent drop in their CPMs in 2020, in comparison to the originally planned rates that they previously had. This is a lot lower compared to the 13 percent drop that digital radio was anticipating for the year, as well as the average 16 percent decrease that online ad sellers were expecting overall.
Across public relations campaigns, there is also a larger demand for podcast inclusion
The decrease in revenues for podcasts was mainly attributed to the first half of the year, and plenty of these companies are expecting to rebound in the second half of the year, according to the study “US Podcast Advertising Revenue” that the IAB published in July. This continued interest in advertising on podcasts is partly due to the overcoming of earlier challenges in the industry, making the ads a lot less measurable.
However, in the latter half of 2018, the bureau established and released guidelines, which outlined a set of ad metrics specifically for podcasts. This is what has since greatly helped this audio format to break out of the experimental ad budgets.
With podcasts, brands can communicate with already captivated audiences
Additionally, with the current ever-moving lifestyle, the public has an option of podcasting on demand. This allows brands and corporations to tell their stories anywhere and at any time, which further helps them establish authority within their industries while also creating brand advocates in the process. Furthermore, before the bureau established the ad guidelines, one of the main challenges was that there wasn’t a way to uniformly measure the ads’ outcome.
Thankfully, with the newfound standardization within the industry, advertisers gained a lot more confidence in establishing a marketing budget specifically for this type of audio format. Additionally, with Spotify releasing its new streaming ad insertion technology, it became much easier to serve and to measure ads, which is only going to help increase the podcast industry.