Podcast Advertising Marketplace Forecast to Hit $659 Million by 2020, More Than Doubling the Record 2017 Total
NEW YORK – U.S. podcast advertising captured $314 million in revenue in 2017, a rise of 86 percent over $169 million in 2016, according to the latest IAB/PwC Podcast Advertising Revenue Study for full-year 2017 released by the Interactive Advertising Bureau (IAB) and conducted by IAB and PwC US. The research predicts even stronger returns in the years ahead, forecasting that podcast revenue will surge to $659 million by 2020, a triple-digit 110 percent hike from 2017.
“These strong numbers speak to advertisers’ increasing recognition that podcasts provide a powerful platform for reaching and engaging audiences”
In self-reported revenues by top podcast companies, revenue continued to rise steadily, growing 94 percent between Q4 2016 and Q4 2017, yielding an 18 percent compound quarterly growth rate.
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%). In addition, ads integrated or edited into programming accounted for 58 percent of the podcast ad inventory in 2017.
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%)
Drilling down into the category advertisers that are spending on podcasts, 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.
“These strong numbers speak to advertisers’ increasing recognition that podcasts provide a powerful platform for reaching and engaging audiences,” said Anna Bager, Executive Vice President, Industry Initiatives, IAB. “Advertisers that range from traditional financial services to direct brand retailers are tapping into the medium’s highly engaged audience. IAB has long been at the forefront of promoting the podcast marketplace and we look forward to another action-packed IAB Podcast Upfront in the autumn, continuing to fuel the growth of this dynamic channel.”
“The growing trend toward ‘anywhere and everywhere’ media engagement has created tremendous opportunity for digital media, of which podcasting is a significant component,” said David Silverman, a Partner at PwC US. “Whether at home on a smart speaker, at work on a PC, or somewhere in between on a mobile device, more and more Americans are listening while they live, providing a robust podcast platform where advertisers can connect with today’s consumers.”
IAB member companies Audioboom, Authentic, ESPN Radio, Gimlet Media, How Stuff Works, Market Enginuity, Midroll Media, National Public Media, Panoply, Podcast One, PMM, Turner Podcast Network, Westwood One, WNYC Studios, and Wondery, underwrote the IAB Podcast Advertising Revenue Study.
To download the complete report, please go to iab.com/podcaststudy2018.
Methodology
The reporting methodology includes compiling a database of the largest podcast advertising revenue generators which are believed to make up a significant portion of the overall market, followed by a quantitative mailing survey with leading industry players, including podcast publishers and ad networks. Specific data items are requested and compiled, including quarterly net commissionable advertising revenue by delivery mechanism, advertisement type, campaign type, buy type, pricing model, podcast content genre, and advertising industry category. In addition, a podcast advertising market sizing is performed to deliver a reasonable estimate of the market in the United States, inclusive of non-survey participating companies.
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About IAB
The Interactive Advertising Bureau (IAB) empowers the media and marketing industries to thrive in the digital economy. Its membership is comprised of more than 650 leading media and technology companies that are responsible for selling, delivering, and optimizing digital advertising or marketing campaigns. The trade group fields critical research on interactive advertising, while also educating brands, agencies, and the wider business community on the importance of digital marketing. In affiliation with the IAB Tech Lab, it develops technical standards and best practices. IAB and the IAB Education Foundation are committed to professional development and elevating the knowledge, skills, expertise, and diversity of the workforce across the industry. Through the work of its public policy office in Washington, D.C., IAB advocates for its members and promotes the value of the interactive advertising industry to legislators and policymakers. Founded in 1996, the IAB is headquartered in New York City and has a San Francisco office.
