Subscriptions to ad buyers’ doubts will upend the advertising direction of the podcast industry. | Daily News Podcast

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Expect to see fewer platform exclusives and don’t worry about podcasting moving away from an ad-supported model. These are two of the messages Jason Endres, Associate Director of National Audio at Active International, has for marketers.

Endres says that while several companies are “trying to break ad-based models” by offering subscription options, he thinks the audio space is unlikely to follow the video model. “While subscription services have been abundant in the streaming video market, questions still arise about the financial viability of the subscription model in podcasting,” he says. “Podcast listeners have less appetite for a paid service than video consumers do. With over a million podcasts in existence, there is so much free content to access.

Endres says the small impact of the three-year-old subscription service Luminary has had less of an impact on the podcast market than many thought when it launched in 2019. And while some shows choose to offer ad-free subscriptions to superfans via a growing list of subscription options, he thinks most publishers will stick with what’s proven in the industry. “Podcast consumers have shown support for the current ad-supported content model and I expect subscription-supported networks will struggle to maintain viability,” says Endres.

Deep pockets from companies like Spotify and Amazon are also less likely to sign more exclusive podcast deals according to Endres. With paydays ranging from the reported $200 million deal for The Joe Rogan Experience on Spotify or $60 million for SmartLess on Amazon Music, Endres believes the exclusives could run their course.

“Publishers have incorporated these shows into their portfolio to grow their overall audience and increase their unique audience. As ROI fades, I see a trend away from exclusives,” says Endres. “A publisher’s goal is to generate as much ad revenue as possible. Podcast listeners have had the luxury for two decades of listening to podcasts on their favorite podcast website or app. Spotify and Wondery have made the effort to break this mold, but it is believed to have a negative impact on a podcast. Podcasts lose their influence and reach when they go to an exclusive platform. He thinks it’s similar to when Howard Stern moved from FM to satellite radio. Financially, the $100 million deal was good for Stern, but Endres says the price paid was a smaller reach and a significantly reduced sphere of influence.

In terms of advertising, Endres predicts there will be more podcast audience data to share with marketers over the coming year, especially at the show level where he says there is had a “great disparity” in data availability. The result made it difficult to compare one podcast to another.

“With Nielsen and Triton becoming more involved in podcast analysis, I expect more data to be revealed in 2022; ultimately helping marketers and brands better determine which podcasts align with their marketing goals,” he said.

Endres also expects programmatic ad buying to continue to take hold as publishers look to grow revenue beyond the host-read ads that helped the podcast hit its first billion dollars. revenue dollars.

“For podcasting to become a $2 billion industry, audience-based ad buying will have to become a major factor,” he said. “As companies like iHeart, Pandora, and Spotify continue to invest in the space, their experience in audio streaming as well as their partnerships with ad tech companies will further enable them to offer audience-based ad buying. audience. Yes, there are opportunities today to buy by demo, geo-targeting, and some behavioral targeting, but that will increase dramatically in 2022. The opportunity for publishers to tap into a marketer’s programmatic ad budgets is lucrative. .

Marketers should also expect to see more sports betting content, predicts Endres. While some shows may come from traditional publishers or independent hosts, deep-pocketed sports betting brands are driving much of the gains as companies like Cumulus Media and BlueWire line up with Wynn and FanDuel enters a four-year, $120 million alliance with The Pat McAfree Show.

“McAfee has a large and loyal following, but certainly not one that would bring in a $30 million annual payout based on an audience and CPM model,” says Endres. “What we see is the exponential potential of aligning a sportsbook with an audience. The ability to be exclusive offers so much potential long-term value for a sportsbook that it makes possible a partnership of several million dollars. He thinks that as more states allow online sports betting, Caesars, Draftkings, MGM and Pointsbet and others will consider making similar types of offers.” power of affiliate partnerships between sports betting companies and podcasts will be a boon for the category and content creators,” says Endres.

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