Advertisers are continuing to invest heavily in podcasting, and with good reason. After impressive gains in U.S. podcast ad revenue from 2018 to 2019, revenue is expected to increase by 14.7% in 2020, despite COVID-19.
The Interactive Advertising Bureau (IAB) and the accounting firm PricewaterhouseCoopers (PwC) recently released their annual podcast advertising revenue report, which included these key findings:
- Total market year-over-year revenue estimate increased 48% to $708.1 million in 2019, from FY 2018’s total market estimate of $479.1 million
- 2020 U.S. podcast advertising revenue is expected to increase by 14.7%
- Podcast advertising is considered more resistant than other media against COVID-19 for multiple reasons; the channel’s flexible format enables quick shifting of ad messaging; the News genre, which was already favored by podcast advertisers, is seeing greater adoption by consumers in 2020; the already strong podcast ad industry categories, Direct-to-Consumer (DTC) and Financial, are maintaining overall market strength despite COVID-19.
- News is the top podcast content genre for U.S. podcast advertisers, capturing 22% of revenues
- Health & Wellness and Home & Appliance are the largest DTC sub-categories
- Host-read ads made up 66% of podcast advertising revenues in 2019
The IAB and PwC expect podcasting to cross the billion-dollar mark with $1.1 billion of ad revenues in 2021, a 35% increase over 2020. This prediction speaks to the strength of podcasting as a powerful medium for advertisers.
The effectiveness of podcast ads can be measured by site and search traffic generated by podcast ads, but brand lift studies are also demonstrating that podcast ads deliver awareness and sales.
A recent brand lift study revealed that those exposed to HelloFresh podcast ads had a 164% increase in unaided awareness and a 44% increase in aided awareness. Unaided awareness is when a customer can name the brand or store without any help. According to Westwood One, unaided awareness is “the most important metric” to ensure profit and long-term sales.
The study also found the brand favorability of HelloFresh grew by 51% in listeners exposed to the podcast ads, and there was a 16% lift in those that said they would take an action.
If you’re an advertiser who has not yet made the leap to the podcast medium but would like to learn more, SMI can help. To find out how you can use podcast ad exposure to boost awareness, brand favorability, and sales, contact SMI today.