The International Advertising Bureau (IAB) recently released two reports that shed light on the state of podcast advertising and digital advertising in the US and they reveal an encouraging trend: podcast ad revenue grew by 26% year-over-year in 2022, surpassing growth in the overall digital ad market by 11% [1].
Please note that this article covers the period up until the end of 2022. We won't have any reliable stats for 2023 until early next year.
Rephonic is a database of 2.5m+ podcasts that we built in response to this growing demand from brands looking to get in front of new audiences. By examining data from the IAB reports and other sources, we put together a few charts that show how podcasts compare to other digital channels, both in the US and globally [2].
TL:DR;
- Podcasts are one of the fastest-growing channels
- Podcast ad revenue and ARPU lag way behind other channels
- Podcasting is slowly increasing its share of the audio ads pie
United States
📈 Podcast ad revenue is growing strong in the US
First we looked at the US market. Of all the channels included in this chart, podcasts have demonstrated the highest year-over-year growth in advertising revenue each year, with growth reaching its peak for all channels in 2021 [3].
Over the past three years, podcasts have consistently outperformed the broader category of digital audio, which encompasses podcasts, music streaming, and radio streaming. This suggests that podcasts have established themselves as a force in the audio landscape, captivating audiences and attracting advertisers.
⬆️ Podcast ad revenue has a long way to go to catch up
While podcasts are experiencing impressive growth, it's important to note that they still have a long way to go in catching up to search, display, and digital video:
In 2022, podcast ad revenue amounted to a modest $1.8 billion, paling in comparison to the $84 billion generated by search advertising [3].
🔊 Podcasting is slowly but steadily increasing its share of the audio ad pie
We also examined the proportion of all audio ad revenue that comes from podcasts in the US. Podcasting has been increasing its share of the audio ad pie for the past three years, with podcasts accounting for nearly one-third of all audio ad revenue in 2022 [3][4].
Rest of the world
Please note that statistics on podcast advertising are less reliable outside of the US.
🌍 Podcast ad revenue is growing everywhere else too
Turning our attention to global statistics, we discovered a similar story for ad revenue growth. In 2023, global podcast ad revenue experienced a significant jump of 23% year-over-year, while by comparison search ad revenue increased by 11% [5].
👤 Podcast ARPU still lags behind
Comparing the average revenue per user (ARPU) for ads across different channels, podcasts are earning a similar figure to in-game advertising. In contrast, search and video channels boast significantly higher ARPUs of $52 and $33, respectively [5].
In other words, podcasting remains significantly under-monetized compared to pretty much every other digital channel.
Final thoughts
Podcast ad revenue continues to experience strong growth, outperforming other channels, including the broader digital audio landscape. This growth reflects the growing appeal of podcasts as a medium but there is still a significant gap between podcast ad revenue and established channels like search and video advertising.
Given that podcast advertising is arguably still in its infancy and the evidence suggests that listeners generally don't mind ads, now could be a good time for more brands to jump in and try it.
Rephonic is a database of over two million podcasts that makes it easy for brands, agencies and podcasters to discover shows in their niche and make better decisions about which ones to get featured on. Get started for free and access listener numbers, chart rankings, contact info and lots more.
Footnotes
[1] Figure taken from the PwC / IAB FY 2022 Podcast Ad Revenue Study
[2] US statistics are taken from reports by the International Advertising Bureau. Global statistics are taken from Statista and may be less accurate.
[3] Podcast statistics are taken from the PwC / IAB FY 2022 Podcast Ad Revenue Study and statistics for other digital channels are taken from the 2022 PwC / IAB Internet Advertising Revenue Report
[4] We calculated the proportion of audio ad revenue that comes from podcasts using the figures provided in the two reports.
[5] Figures taken from the following Statista reports:
