US Programmatic Podcast Ad Spending Will Double in 2020

US Programmatic Podcast Ad Spending Will Double in 2020

Programmatic podcast ad spending in the US, which we are forecasting this year for the first time, is growing at a fast rate from a small base. We define such ad spending to include podcast ads that are transacted and fulfilled via automation. Spend will double from last year to $31.3 million and reach $106.5 million by 2022.

Just 4.0% of total US podcast ad spending will transact or be fulfilled programmatically, up from 2.2% last year. That figure will increase to 8.0% in 2022.

There are multiple reasons why programmatic has been slow going into podcasts:

  • Some podcast publishers haven’t adopted the necessary ad tech to facilitate these transactions.
  • Apple, which controls one of the most popular platforms for podcasts, has been reluctant to share listener-level data with advertisers, making targeting and measurement more difficult.
  • Brand awareness, which is influenced more by overall reach than hypertargeting specific segments, has become a more common podcast campaign goal.
  • Some podcasters fear that programmatic could reduce their ad prices and ruin the user experience, so they turn to embedded host-read ads instead.
  • Some ad buyers prefer embedded host-read ads because they find them to be more effective.

Nearly half (47%) of US podcast advertising was purchased on an annual rate in 2019, and 31% was purchased quarterly, according to the Interactive Advertising Bureau (IAB). Some 21% was bought on a scatter basis. And only 1% was purchased programmatically.

When so much inventory is purchased well before a campaign runs, it restricts programmatic’s role.