I'm a big fan of podcasts; this year I've heard multiple podcasts that I listen to say that the bottom fell out of podcast ad sponsorship money and they lost a lot of funding. Many were looking for alternative ways to fund their podcasts like selling monthly subscriptions. I wonder if the ad market will start to drop out for other stuff like websites too. AI might cannibalize search engine traffic... if google can ba…
Why are podcasts being affected?
- 10-20 companies focused on Direct to Customer (DTC) products seem to make up the majority of advertisers for a lot of podcasts: VPNs, mattresses, personal grooming products, discount code providers, online courses, etc. If their ad budgets are reduced in the current economic climate, podcast earnings will fall. It's also possible that they've collected enough data to know that ROI in this medium isn't great, and growth of podcast creation is slowing.
- A lot of top podcasts have been being acquired by Spotify and Apple as exclusives over the past few years, where a lot of this ad spending was concentrated . This reduces the total pool of advertising money available.
- Programmatic advertising (where ads are spliced into the downloaded file, varying by geographical location) has lowered the cost of advertising, so the money paid out to podcast owners is less.