Over the last few months, the tone of a few widely circulated articles about podcasting have taken something of an abrupt turn. Unbridled optimism has been replaced by headlines projecting a rocky road ahead for podcasting or even a sense that podcasting’s best days were somehow behind us.
It’s time to put the stories and the headlines into perspective.
It’s true not all the news from the podcast industry over the past few months has been rosy. Much like what we’ve been seeing, though on a much smaller scale, from the tech giants like Facebook, Amazon, and Google, there have been recent layoffs at Acast and among the podcasting teams at Spotify and CNN. Meanwhile, some podcast companies are re-evaluating the 9-figure mega deals that dominated so much of the conversation the last few years. These stories provide a counterpoint to what has been a seemingly endless stream of upbeat news around the growth of listening and ad revenues flowing to podcasting.
The pending recession (if it ever comes) is the big culprit here. Advertiser fears have tempered what Signal Hill’s new Chief Insights Officer and Partner Paul Riismandel calls “irrational exuberance” within certain corners of the industry. The clearest example are the huge investments made by some big players to seize the high ground as podcasting ad revenues effectively doubled every two years since 2015.
Good journalists have reported these stories as they should, even if the doomsday headlines often seem to target clicks more than they reflect the balance presented in the story itself. Other long-time observers of podcasting, dismayed by the many changes in the industry in recent years, have jumped into the fray complaining that the problem is that podcasting isn’t what it used to be.
In fact, there continues to be much to celebrate about podcasting and its potential.
Podcast advertising revenues keep showing growth that virtually any other media would die for. Factoring in recession concerns, eMarketer now predicts that US ad revenues for 2022 will come in 28.6% higher than 2021, projecting the year-over-year increase for 2023 rising to 31.8%. The IAB’s 2023 Outlook Survey from this Fall has buy-side decision-makers expecting to increase their US spending in podcasts at a greater rate than digital video (excluding CTV), social media, other digital audio, digital OOH, digital display and gaming, while spending less on traditional media.
Fueling this is the continued growth of podcast listening. The Reuters Digital News Report 2022 found an average annual increase of nearly 10% of past month podcast listeners in the 20 countries where they feel confident that respondents understand the term ‘podcast.’ In the Canadian Podcast Listener 2022 study we conduct with support from TPX (The Podcast Exchange), we have seen increases of more than 10% in both weekly and monthly listeners.
Of course, growth like this can’t go on forever and gains will become incremental as time goes on. However, any suggestion that podcast listening will decline any time soon simply runs counter to the trend towards on demand media we’ve seen over the past 25 years.
The podcast industry is shifting to a period of mature growth. That will require some readjustments to grand ambitions. Not that we’re going through anything like the dot.com bubble that burst following the first few heady years of the world wide web, but it’s worth remembering that the collapse of so many dot.com stocks didn’t spell the end of the Internet. Instead, smart, savvy companies that identified an opportunity and carefully built a strategy around it took the Internet to places where no one expected it to go.
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