The US podcast industry had a great run in 2017. According to the latest joint study conducted by the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC), the industry raked in $314 million last year.
The IAB, which was responsible for the Podcast Advertising Revenue Study for the second year in a row, stated that 2017's revenue showed an 86% growth for the year. The medium generated $169 million in 2016.
The two companies also predicted that the podcast market will be worth around $659 million by 2020. That's a 110 percent growth between 2017 and 2020.
[Graphic via InsiderRadio]
The IAB study even touched on the kind of podcasts that benefited from the increasing interest in the medium and the advertisements that suited it.
Unsurprisingly, the most-preferred ads were the host-read spots. This accounted for more than two-thirds of the ads in 2017. Direct response ads, which are designed to generate an instant reaction from the show's listeners, captured a big chunk of the marketing campaigns. Brand awareness came in third at 29%. Meanwhile, ads integrated into the podcast or embedded into the show took up 58% of the combined ads of the year.
While there are different types of advertisers willing to shell out money for that all important air time, the top three spenders are financial services companies (18%), direct-to-consumer sellers (16%) and marketers from the arts and entertainment sectors (13%).
It goes without saying that not all podcasts are created equal. Some types are just better when it comes to money-making. Fourteen genres were tested, and the top four categories for content are Arts and Entertainment (17%), Gadgets and Technology (15%), News and Politics (13%) and Business (11%).
The revenue generated by podcasts is even more impressive considering that this avenue is still growing.
According to Anna Bager, the EVP of IAB's Industry Initiatives, the “strong numbers speak to advertisers' increasing recognition that podcasts provide a powerful platform for reaching and engaging audiences.” She also stated that advertisers are just now starting to tap into the medium's “highly engaged audience.”
This bodes well for podcast startups. The boost in consumer interest has certainly helped companies like Wondery, which raised $5 million this year thanks to Greycroft, Shari Redstone's Advancit Capital, and Lerer Hippeau Ventures. Meanwhile, Castbox has already raised $13.5 million for its new podcast app.
The rising interest in podcasts is also largely attributed to how people now listen to content, which is through mobile devices and smart speakers as they go about their lives.[Featured image via Pixabay]