Daily news podcasts are experiencing the most rapid growth of advertising spend in the podcast market as they dominate podcast charts, reveals a new report by the Reuters Institute for the Study of Journalism (RISJ) published today (3 December 2019).
The study, News Podcasts and the Opportunities for Publishers, interviewed around 30 publishers, platforms and producers in five countries (US, UK, Australia, France and Sweden) and looked at trends in the respective and overall podcast markets.
Generally, it found that news podcasts continue to outperform all other podcast categories, despite accounting for a smaller market space. For example, just six per cent of the 770,000 Apple podcasts are categorised as 'news podcasts'. At the same time, news podcasts account for just less than a fifth of the top 250 podcasts in the UK, and more than a third in France.
It resonates with previous findings that the industry is experiencing a podcast boom and more publishers are understanding its potential, with 12,000 news podcasts created in the first ten months of 2019 alone.
“News obviously has more volume. People are listening to one or two podcasts as part of that frequency, so these programmes have evidenced significant audiences,” said Nic Newman, senior research associate, RISJ, and lead author of the study.
'Deep dives' podcasts like the Guardian's Today In Focus podcast attract listens in the 'hundreds of thousands', according to the report. While in the US, New York Times' The Daily achieves two million listens a day.
Although Newman explained growth is expected to slow, the 200,000 new podcasts this year demonstrate that this market has not reached its fullest potential yet, particularly with the prospect of further integration of voice technology in our day-to-day lives still to come.
The option to produce deep dives, or shorter mini-bulletins and round-ups means podcasts are a more accessible option for organisations - and often traditionally non-broadcasters - with a range of different budgets to have more online and mobile offering. It also makes practical sense for broadcasters to reversion content into podcasts, like LBC's host James O'Brien's talk show.
It is this bustling space which is proving an attractive - and safer - proposition for advertisers. Advertisers have traditionally been concerned about topic association and brand safety in the online space, but the mood is changing with podcasts.
"It's easier to buy into a particular network of publishers, it's a safer bet and its advertisers want to know how they can do more. Broadly, podcasts are increasing advertiser buy-in," said Newman.
News podcasts are the fastest area of podcast growth, up 38 per cent in 2018. However, the findings are not game-changing for the industry yet, ad spend in the market podcast is estimated to reach $1bn in 2021, significantly lagging behind the $18bn in radio.
However, those on the top end seem to be doing well. US non-profit organisation NPR has become one of the leading names in podcasting in recent years. It is expected to earn $55m from podcasting next year, overtaking radio in terms of sponsorships, according to the report. The study revealed how even traditionally non-broadcasters and "intensively staffed news podcast" like The Intelligence from The Economist became a profitable output within six months.
Tom Standage, deputy editor and head of digital strategy, The Economist noted in the report: "The big change is commercially, which is that we had advertisers who started to come to us last year and said we are only going to buy two kinds of ad next year. Print and podcast, what have you got?"
The big lure for advertisers is the ability of podcasts to engage with hard-to-reach younger audiences. In the US, 54 per cent of 18-24-year-olds are tuning into a podcast every month. That number is lower at 41 per cent in the UK over the same space of time. The Economist has revealed how podcasts are part of a strategy to discover new, and crucially younger, audiences.
Because podcasts are so associated with concepts around building habits and loyalty, advertisers are keen to be seen alongside those benefits - even if it this means less profit short-term - and strategise around long-term subscription conversions.
1. Who is producing news podcasts? What types are they producing? How does that differ across countries? These are the questions at the heart of a NEW report by @nicnewman & @GllzN.
— Reuters Institute (@risj_oxford) December 3, 2019
The report focuses on 🇬🇧🇺🇸🇫🇷🇸🇪🇦🇺. Key findings in this threadhttps://t.co/QISMPvN24j pic.twitter.com/OT0fUNRZzy
However, publishers are concerned that placing ads within podcasts could seem invasive or disruptive to some audiences. There are also concerns that podcast platforms - Apple and Spotify, chiefly - will profit at the publisher's expense, and the abundance of podcast interfaces will result in reduced reach and content revenue.
"How can you do semi-exclusivity?" asked Newman. "BBC publishes first on BBC Sounds and then after 12 hours it goes everywhere else."
Danish news organisation Politiken, in fact, ties podcasts into its subscription offering, giving early access to subscribers. The caveat is that this is also promoted due to doubts around advertising spend in the relatively smaller market of Denmark.
New podcasts launched this year - like the Social Media Geekout - use what the report identifies as 'host reads'. These are amongst the most lucrative options, which would involve the podcast host creating their own advertisement on behalf of sponsors in order to feel more natural, as opposed to a distinctly sponsored jingle. However, daily podcasts almost never do this because of concerns around trust and authenticity.
Newman concluded that the flexibility of podcasts spell optimism in the times ahead, though not all publishers will succeed. Some will have teething issues, and others will run away as clear winners.
"There is the problem of discoverability. Publishers need to produce a high quality product that is fulfilling daily need," he explained.
"Just like Netflix, those with the highest production budgets will do incredibly well. It's more high risk, as it will require more investment. But there will be lots of opportunities in niche content to satisfy passions."
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