At a time when advertising across many sectors is slowing down, podcast and audio investments might remain strong in the next year.
The audio business is continuing to grow on platforms, from live streams to exclusive shows, with varying success. Players from Spotify to Pandora owner SiriusXM saw ad revenue grow in the second quarter, whereas tech giants like Meta saw dips. Additionally, with Twitter and YouTube recently introducing podcast features, there are growing options for brands and creators to generate additional revenue and reach another demographic.
Experts say podcast listeners are a sticky audience, and the content offers more flexible ad formats. That might explain why the podcast advertising spend has grown from $806 million in 2018 globally to $2.6 billion this year, according to research firm WARC. In 2023, it is projected to reach nearly $2.8 billion globally, accounting for 26.8% of all online audio investments. By comparison, global ad investments in radio will drop an estimated 2.4% next year.
And with more devices for listening available, more adoption will lead to newer audio ad formats, such as shoppable or interactive ads. Paul Kelly, chief revenue officer of A Million Ads, believes podcasting as an ad-supported medium is “currently under-monetized.”
“Adding to cart [or] saving to a bookmarking list creates an entirely net new advertising surface for those moments where we are not actively consuming media,” Kelly said.