The Interactive Advertising Bureau has released the US Podcast Advertising Revenue Study 2023: Drivers, Strategies, and Tactics for Growth. The study sheds light on the dynamics of podcast ad revenues in the United States, offering insights into the market’s evolution.
Conducted by IAB and PwC, this comprehensive quantitative survey and discussions with industry experts unveil the factors driving podcast ad revenues and provide insights into the future direction of the market.
Podcasting continues to gain traction among larger brand advertisers. The report highlights that podcast advertising effectively serves buyers’ key performance indicators across the marketing funnel. Notably, 61% of total ad revenues are attributed to brand-building efforts, marking a 13% increase over the past two years.
Brand safety and suitability solutions within podcasting have surged, with 69% of publishers utilizing brand safety measures and 62% employing brand suitability solutions, including contextual transcript analysis. The study also indicates that buyers are diversifying their measurement solutions for podcast campaigns, aligning them with practices from other digital channels.
Dynamic ad insertion has also gained prominence, accounting for over 90% of ad revenues, nearly doubling in the last three years. To sustain this growth trajectory, podcasting must further develop its capabilities to compete with other digital media channels for advertisers’ investments.
The study underscores the need for interconnected networks that offer advertisers both scale and precision, with programmatic showing significant growth but still comprising only 11% of podcast revenue, compared to 87% in other digital media channels.
Publishers are encouraged to reimagine their podcast ad inventory to facilitate advertisers in reaching audiences across various shows, episodes, and properties, as sophisticated, audience-based purchases account for only 25% of podcast revenues.
A notable opportunity lies in the incorporation of video within podcasts, as users increasingly consume podcasts in both audio and video formats. Currently, video-enabled podcasts constitute less than 10% of revenues, signifying substantial potential for audience engagement and monetization.
IAB Media Center Digital Audio and Video Director Matt Shapo said, “The growing interest we’re seeing in podcasting among larger, brand awareness advertisers demonstrates the medium’s evolution to deliver on a range of buyer’s KPIs. Podcasting continues to be a remarkably agile channel that enables advertisers to reach an expanding user base, adopt new functionalities and solutions, and develop new content with creators.”
IAB CEO David Cohen commented, “For marketers who need to respond fast to trends and update messaging on the fly — but need a brand-safe and brand-suitable solution — podcasting is a proven winner. There’s still real growth ahead.”
