Podcast Ad Market Forecasted to Surpass $1 Billion By 2021
NEW YORK — In 2018, marketers spent $479 million to advertise on podcasts in the U.S., an uptick of 53 percent from $314 million in 2017, according to the latest IAB/PwC Podcast Advertising Revenue Study. The report, conducted by IAB and PwC US, forecasts that U.S. podcast marketplace revenues will double by 2021, surging to over $1 billion. Self-reported revenues by leading podcast companies show a similar trajectory, reaching $345 million, a rise of 34 percent over $257 million in 2017.
“Consumers are listening to podcasts wherever and whenever—from their morning workout to their evening commute—making it appealing to brands that want to reach today’s audiences.”
Direct-to-consumer Retailers and Financial Services spent more on podcast advertising than other industry categories. Overall, five business categories represented nearly three-quarters of all advertising revenue captured:
- Direct-to-Consumer Retailers (22%)
- Financial Services (21%)
- Business-to-Business (14%)
- Arts and Entertainment (10%)
- Telecommunications (7%)
Host-read ads continued to be the preferred ad type, constituting nearly two-thirds of all podcast advertising. Direct response campaigns were still the most popular ad type, but are decreasing in popularity, as brand awareness and branded content ad types rose in use. Cost-per-thousand was by far the most dominant pricing method.
“Today’s technology has created an audio-first environment where audio is the preferred interaction—and consumers have put podcasts front-and-center,” said Anna Bager, Executive Vice President, Industry Initiatives, IAB. “Podcast storytelling is deeply engaging and provides marketers with a brand safe environment that enhances the appeal to advertisers. IAB has been a strong supporter of the podcast marketplace, and we look forward to spotlighting the medium’s latest at this fall’s IAB Podcast Upfront.”
“The steady climb in revenues for the podcast ad market underscores the value of the platform’s flexibility and reach,” said David Silverman, a Partner at PwC US. “Consumers are listening to podcasts wherever and whenever—from their morning workout to their evening commute—making it appealing to brands that want to reach today’s audiences.”
ABC Radio, Adswizz, AudioBoom, Authentic, ESPN, Gimlet, iHeartMedia, Market Enginuity, National Public Media, Megaphone LLC, Podcast One, Inc., PMM, Inc., Rawvoice, Stitcher, WarnerMedia, Westwood One, and Wondery sponsored the IAB/PwC Podcast Advertising Revenue Study.
To review the complete report, please go to www.iab.com/podcaststudy2019.
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 program genre, and advertising business 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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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 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.