The Interactive Advertising Bureau (IAB) and PwC released its Full Year 2017 Podcast Advertising Revenue Study, which finds that podcast revenues are reaching an all-time high. In the US, podcasting brought in $314 million in revenue in 2017, which is an 86 percent increase compared to $169 million generated in 2016. The report, which is based on self-reported revenues from top podcast companies, predicts even stronger returns in the coming years, rising another 110 percent to $659 million in revenue by 2020.
The report also indicates that host-read ads were the most preferred, as they represent more than two-thirds (66.9 percent) of podcast ads in 2017. At the same time, supplied ads (pre-produced ads that are usually read by an announcer) were used 32.7 percent of the time. Lastly, supplied radio ads, which appear for the first time on the IAB/PwC report, only represents half a percent of revenue-generating ad types.
Of these promotions, direct response ads (ads that propose a specific action) still made up the majority of campaigns, but decreased from 73 percent of total revenues in 2016 to 64.2 percent in 2017. Brand awareness ad revenue representation increased from 25.4 percent to 29.2 percent, while branded content ad revenue representation increased from 1.5 to 6.5 percent in 2017.
As for delivery, integrated ads (ads that are edited into the programming), transacted at a cost per thousand basis, grew by 14.7 percent and represented the majority of podcast ads in 2017, making up 58 percent of ad inventory. Conversely, automatically inserted ads (pre-recorded ads scheduled using ad insertion technology) dropped to 41.7 percent in 2017.
Of the 14 podcast genres measured, the top four—Arts & Entertainment, Technology, News/Politics/Current Events and Business—collectively captured 56 percent of total advertising revenue, breaking down to 16.8, 14.6, 13.3 and 11.1 percent respectively.
The report also shows that the top four of 13 industry categories captured 59 percent of advertising revenue. Financial Services was the category leader with 18.1 percent of revenues, while Retail (Direct to Consumer) took in 16.2 percent, Arts & Entertainment reached 12.5 percent and Business-to-Business represented 12.3 percent.
“These strong numbers speak to advertisers’ increasing recognition that podcasts provide a powerful platform for reaching and engaging audiences,” said IAB EVP of Industry Initiatives Anna Bager in a press release.
PwC US partner David Silverman added, “The growing trend toward ‘anywhere and everywhere’ media engagement has created tremendous opportunity for digital media, of which podcasting is a significant component. 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.”