Another sign of how media and technology companies plan to help marketers reach the massive audience for podcasts is the acquisition of Triton Digital by IHeartMedia, whose key benefits for customers are portability and adaptability. The acquisition of Triton by IHeart, its latest agreement to expand its digital audio production and programmatic advertising activities, could assist the revenue of broadcasters, which have fallen last year in Q3, although podcast ad sales were a bright spot. A custom advertising network targeted at marketers seeking to reach the audience of the podcast in 2020 was launched by the company.
According to a study by Edison Research and Triton, the percentage of U.S. consumers who paid attention to a podcast last year expanded to 37 percent, or 104 million people, from 32 percent last year. “According to a “Super Listeners” survey, podcast listeners are also advertising-friendly, with 49 percent of them last year noting audio ads are the best way to reach them, up from 37 percent of listeners who said the same in 2019. The study supports the market research firm Claritas’ September report, which noticed that podcasts can raise brand awareness between 24 percent and 79 percent, a significantly higher lift rate than other media channels such as digital display, print, and linear TV. Marketers will increase spending on podcast advertising by 45 percent to $1.13 billion in the U.S. to reach those viewers, researcher eMarketer predicted last year.
The ecosystem is evolving to better assist advertisers as podcast audiences grow, with iHeartMedia being one of the most aggressive in this space. The company expanded its podcast production with the acquisition of Stuff Media in 2018, which produces the “HowStuffWorks.” show. In October, iHeart purchased Voxnest audio tech company, which offers podcasters with programmatic advertising and analytical tools. This year, programmatic ad spending on podcasts in the U.S. will double from $31.3 million in 2020 to $68 million, and reach $106.5 million by next year, eMarketer researchers forecast in July.
As iHeartMedia’s revenue dropped 22 percent from a year earlier to $744 million in Q3, the push into podcasting emerges as advertisers either pulled back on spending or moved their media dollars to digital platforms such as search and social media. However, according to a quarterly report, the podcasting business of iHeart grew 74 percent during the period, helping to push a 17 percent gain in digital revenue. On Feb. 25, IHeart will report results from Q4.
Over the past few years, many other media and technology companies have also stormed to snap up start-up podcasting companies, leading to increased competition for ad dollars. With its reported $300 million purchase of podcast producer Wondery, Amazon indicated its increasing interest in the audio format in December. Sirius XM, the satellite radio company that owns Pandora’s audio platform, bought Scripps’ Stitcher podcasting unit for $325 million last year. The New York Times bought the producer of the popular “Serial” program last summer for $25 million.
Audio streaming giant Spotify has made various podcasting deals, including its purchase in November of podcast advertising and podcast company Megaphone for $235 million and its acquisition for as much as $196 million a year ago of The Ringer, a network focused on sports and cultural programming. It also purchased podcast producer Gimlet Media, podcast production platform Anchor, and narrative-focused podcast studio Parcast for a reported $230 million.