Gen Z And Millennials Are Driving A Podcast Revolution

The podcast revolution has probably passed many people by. It has been happening behind headphones on buses and trains and it isn't until there is a big announcement in the space that you realise that it is actually huge business.

Spotify's purchase of Gimlet and Anchor -- platforms for distributing and making podcasts -- shows there is a real phenomenon in audio entertainment going on. The Telegraph estimates the Swedish music stream paid around $200m for Gimlet, making it the company's most expensive purchase to date.

Spotify's founder explained the purchase with a forecast that soon enough, 20% of time on Spotify will be people consuming podcasts. The trouble for the person in the street, of course, is that they are hard to track down in one place, other than on Apple, which is arguably why Spotify thinks there is a business to be had in collating popular programming under one roof.

It is easy to imagine that with Spotify's reach, and marketing budget, it can make a huge impact in the niche, with people able to see what friends are listening to and the machine-learning algorithms suggesting what people should download next.

Spotify's activity prompted me to do a little research into whether this is a flash in the pan or a solid trend. It would appear to be the latter.

Ofcom research shows that nearly six million adult Brits listened to podcasts every week in 2018. That is a near doubling in the size of the market in five years. In terms of proportions, it represents 11% of the UK adult population.

Perhaps more interestingly for Spotify and the tech giants, the same research shows that the biggest demographic tuning is those ages 15 to 24. With one in five of the Gen Z demographic listening to podcasts every week, by definition, that's very nearly twice the penetration seen in the UK adult average.

In fact, delve a little deeper and it turns out that half of the podcast market is age 35 or under, although this age group is far less likely to tune in to traditional radio that those older.

What we have here, I would suggest, is a Netflix of radio or at least of audio content. Gen Z and millennials are less likely to tune into a radio set than their parents, but they are interested in audio content. As one would expect from those who came after Generation X, Gen Z and millennials are wanting to listen to audio on their terms -- on a device that suits them and a time when it's convenient. 

With half of podcast listening coming from this young audience that advertisers are keen to reach, yet are more likely to be ad blocking than older groups, the medium suddenly looks very attractive, doesn't it? 

It just shows behind those ear pods at the bus stop and train station, there has been a very quiet revolution taking place -- and it's opening up a youthful demographic that are less receptive to digital display, are less likely to be listening to commercial radio and increasingly dodging television ads by streaming shows to a laptop and watching catch up entertainment with a fast-forward button to hand.

Podcasts suddenly become a lot more appealing if you delve into who is doing the listening. 

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