Special contribution to Silicon Hills News
SXSW Interactive was packed full of sessions and panels on the exponential growth of the podcast industry as well as meet ups and live podcast performances from local and global shows.
Once the basics were covered in each of these panels like, “How do you start a show and grow an audience?”, the conversations quickly focused on monetization. This was covered extensively by a few industry veterans and their message was extremely optimistic for this burgeoning industry.
The Evolution of Podcast Advertising was a packed panel moderated by Nick Quah, Founder and Publisher of Hot Pod Media, LLC which is a leading news source in the on-demand audio industry.
The tone of the discussion was that of incredible opportunity in an emerging market that has catapulted over the tipping point referring to the percentage of people ‘familiar with the term “podcasting’’’ that topped 55 percent (155 million people) in 2016 compared to 22 percent in 2006.
It’s not just familiarity with the term, but listener growth has skyrocketed in the last 10 years. In 2016, 36 percent of the U.S. population had listened to a podcast, which is 98 million people and 21 percent reported that they listened to at least one podcast episode per month.
With this tipping point comes advertising budgets from large corporations moving the ad spend from radio over to podcasts.
Sarah Van Mosel, Chief Podcast Sales and Strategy Officer for Market Enginuity points to a few specific metrics that are driving ad dollars to podcasts:
3. Deep audience engagement
In addition, Van Mosel says that listening on-demand creates more habitual listening in a person’s daily life.
The most encouraging numbers came from Matt Leiber of Gimlet Media and confirmed by Matt Turck of Panoply. Lieber made his name hosting the StartUp Podcast, which is a transparent look into how he started his podcast network, Gimlet Media. Lieber projects that podcast ad spends will triple from 2016 to 2020.
Podcast Ad Spend Projections from 2016 to 2020
- 2016 = $167 million
- 2017 = $264 million (projected)
- 2020 = $500 million (projected)
These dollars pale in comparison to the ad money spent in the radio industry in 2016 alone:
Radio Advertising for 2016
- 2016 radio ad spend was $17.8 BILLION
- 80 percent of the ad dollars were focused in local markets only
- Average of $10 per 100 hours for radio ads compared to $2 per 100 hours for podcast ads.
The final trend pointing to greater ad spend in the podcast industry is renewal rates from existing customers’ advertising campaigns. Gimlet Media is trending at over a 90 percent advertising renewal rate from their existing customers.
Companies aren’t just spending more on advertising in the podcast industry, they are creating their own podcasts to advance their brands mirroring what they’ve done previously with video and written content marketing.
Monetization is the key to sustaining and growing a successful show. Based on reports from SXSW 2017, the industry is a solid media play for entrepreneurs wanting to market their startup and for corporations growing their brand and customer base.
The SX vibe solidifies that podcasting is a sky rocketing industry that’s not about to touch down anytime soon.