This Week in the Business of Podcasting

In just ten days I will be in sunny Denver for Podcast Movement (don’t forget to drop by the Sounds Profitable Partner Lounge). Until then, I need to procrastinate packing and you’ve got this week’s highlights to read!

Spotify x Patreon integration goes live.

This Thursday Spotify announced podcasters can now access the integration. Powered by Spotify Open Access, creators can now add Spotify distribution to their podcasts within Patron. A quote from the Spotify blog:

“Patreon is our latest partner in a growing list of publishers and platforms that offer subscriber-only content powered by Spotify Open Access. With just a few clicks, podcast creators on Patreon can add Spotify distribution to their podcast to grow their audiences while retaining full control over their subscriber bases, their content, and their revenue.”

Spotify is also testing out a new promotional feature that will allow podcasters to run a banner ad for their premium feed on the free version’s Spotify page. Once implemented, the feature will be available for all Spotify integrated platforms, including Patreon, Supporting Cast, and Supercast.

The easier it is for casual podcast listeners to access more of the content they like, the more likely they are to stick around long enough to be power listeners.

Acast, iHeart, and Spotify earnings calls.

It’s quarterly earnings call season once again and some of the bigger names in podcasting have good numbers to share. Starting with Sara Guaglione’s roundup article for Digiday this Wednesday: iHeartMedia, Spotify, and Acast all reported quarterly revenue growth between 12% and 31% year-over year in their podcast businesses. A quote from the article:

“Their earnings results mirror recent reports that U.S. podcast ad revenue is expected to continue growing. According to research conducted by PwC for the Internet Advertising Bureau in May, total podcast ad revenue is projected to hit $2.28 billion in 2023, up 25% year over year.”

Sirius XM’s earnings call was covered by Brad Hill of RainNews. Both podcasting and streaming music are considered ‘off platform’ content in SXM’s reporting structure, with off-platform reaching 13% year-over-year revenue growth in Q2. Pandora’s Q2 profit was $152 million, a quarter-over-quarter increase of 29%.

iHeartMedia’s podcast revenue was $97 million in Q2, a 12.9% year over year increase. Acast is up 22% from last year with net sales hitting $36 million. Spotify reports podcast advertising revenue growth is more than 30% year-over-year, a promising development given the company’s pivot into growing advertising.

Why some publishers are pruning podcasts.

Last Friday, Sara Guaglione covered several major podcast publishers and how they’re trimming podcast costs in an effort to grow their core audio business.

NPR’s podcast team has adopted a strategy of consolidating feeds, switching to running limited-run new projects inside existing RSS feeds instead of launching new podcasts. By consolidating feeds, also NPR hopes to alleviate spreading that listener base thin over multiple shows.

Meanwhile, The Atlantic has cut several podcasts dedicated to smaller soccer clubs, redirecting resources to growing their core shows. A quote from audio managing editor Iain Macintosh:

“There was a huge slate of club shows and that’s been compacted down. But I think we’re doing what we’re doing better, with more thought, more authority and still having the opportunity to try new things.”

The Athletic has also tested a marketing initiative in the U.K., putting all of its marketing power behind one podcast for an entire week before moving on to a different show in the catalog. Macintosh says the experiment saw a big increase in audience with many double-digit increases, though specific stats were not shared.

The era of flashy acquisitions and building massive catalogs is likely at an end, taking a back seat to focused marketing and tight-knit collections of flagship productions.

Industry Insights with Magellan AI

During Q1 and Q2 2023, overall average ad loads increased from 5.55% to 5.97%. Quarter-over-quarter ad loads increased across all show groupings, but most (+0.86) in the Top 500.

Looking to get a handle on podcast advertising metrics? Book a demo with the Magellan AI team.