• by Ray Schultz , Columnist, May 9, 2024

Podcast advertising is on track to reach $2 billion this year and $2.6 billion by 2026. But 2023 was sluggish, judging by the U.S. Podcast Advertising Revenue Study, from the Interactive Advertising Bureau (IAB), conducted by PricewaterhouseCoopers LLP.

Last year, podcast advertising showed modest growth, 5%, for a total of $1.9 billion, due to a tough advertising climate that affected mid-tier companies, the study says. Podcast revenues had been growing by double digits prior to 2023.

"While a few of the largest podcast companies maintained double-digit growth, mid-tier companies hit a speed bump," said Chris Bruderle, VP, Industry Insights & Content Strategy, IAB. "But revenue is already bouncing back."

Looking forward, publishers will achieve growth by utilizing measurement, programmatic, live events, stronger show promotion, and video podcasts.

The study is based on a survey conducted in February, and on market analysis. This is the eighth year it has been conducted. 

Comedy is now the top podcast genre for advertising, growing by four points over the past two years. Nearly 300 new advertisers were added during Q4 2023. Sports has declined slightly from 15% growth in 2022 to 13% in 2023, but it remains the second most popular subject. 

"Between comedy and sports, consumers are using podcasts to be entertained and delighted - which provides a sanctuary from other serious headlines playing out across the nation and the world," said David Cohen, CEO, IAB. "It's where the greatest engagement and subsequent ad dollars are."

Meanwhile, CPG brand revenue grew by 4% and retail by 5%, likely because podcasts provide more direct connections with consumers, the IAB says. 

Over 25% of podcast revenues were in the “other” category, which includes such topics as government, nonprofit, pets and home. 

"Podcasts deliver at scale, can pinpoint niche audiences, and have the power to build authentic connections with consumers," continued Cohen. "And as audience measurement in podcasting becomes more aligned with other digital channels, there's more growth ahead."

In a separate report, podcast producer Acast states that 44% of U.S. ad investment goes to the top 500 shows, although those account for only 12% of monthly reach. 

Acast adds that podcast is a wide-open opportunity for advertisers, given that only 9% of the overall ad spend now goes to audio and 31% of audience media time. But 36% of U.S. audiences have not yet listened to a podcast.