The podcasting world has recorded significant growth in recent months, with more consumers showing interest in different genres. The growth is now reflecting on the revenue side as more advertisers aim to capitalize on the sector.
Data acquired by Finbold indicates that the United States podcast advertising revenue is projected to surpass the $1 billion mark for the first time in 2021 to hit $1.34 billion. The figure represents a growth of 59.9% from the $842.3 million revenue recorded last year. By 2022, the revenue is projected to hit $1.7 billion. As of 2023, the sector’s ad revenue is projected to hit $2.18 billion, a growth of 64.70% from the 2021 projection.
Elsewhere, the news segment remains the most profitable genre recording a revenue share of 22% both in 2019 and 2020. Comedy ranks second, although the 2020 revenue share slightly dropped to 16% from 17% in 2019. Despite the focus in the financial sector over the past year, business and finance podcasts revenue share also plunged in 2020 to 9% from 11%.
Driving factors in podcast revenue growth
The world of podcasting has grown exponentially over the last few years, and it doesn’t look like it’s slowing down. With the growing popularity of podcasts, the platforms are witnessing a spike in revenue streams, including content licensing and consumer payments.
Numerous factors have contributed to the emergence of podcasts as an attractive medium for marketers deploying digital advertising. Notably, the audience has attained critical mass with innovative measures seeking to attract more listeners. Over the past year, the podcast sector growth has also benefited from changing human behavior.
Amid the coronavirus pandemic, most people resorted to podcasts as a means of entertainment. With people confined at home, they were interested in knowing more about the health crisis. Additionally, working from home also grew in popularity; this explains why science and fitness were among the biggest beneficiaries of the ad share.
The growth in podcasts has also seen more interest in acquisitions, expanded marketing efforts, and distribution outlets emerging with leading streaming platforms jostling for the market. Amid this growth, podcasting has come with flexibility, something appealing to advertisers.
Additionally, the podcasting sector is characterized by a self-reinforcing growth of audience and content, resulting in a corresponding rise in ad revenues. Some podcast publishers have significantly been focusing on improved content, and better content has attracted more viewers, leading to more ad revenue.
The future of podcasts
The basic nature of podcasts will mainly guide the projected revenue growth. Notably, engaging hosts who can build a trusting rapport with loyal listeners will be critical in the types of and value of ads they attract. Additionally, it will be vital to monitor how the radio sector responds to the growing podcasting sector.
Elsewhere, the growth of podcasts and consumers comes with several challenges, especially with audience measurement. This challenge presents an opportunity for improvement. Notably, there is progress being made with continued improved measurement of the podcast scale.