The news: Spotify will now let any podcaster using its publishing platform Anchor upload video podcasts, after beta testing the feature for a year, per TechCrunch.

How we got here: The Swedish streaming company tried to get in-app video off the ground as early as 2016, experimenting with artist biopics and animated shorts.

• Those projects didn’t take off, but Spotify has finally found an avenue in video podcasting.
• That’s likely because video podcasts like “The Joe Rogan Experience” and those by sports network The Ringer were already massively popular before Spotify acquired them as part of its growing podcast business in 2020.

Why it matters: As the podcast medium grows in popularity among consumers, it’s gaining steam among marketers.

• Spotify’s podcast listenership in the US has grown so rapidly that we expect it to exceed that of Apple Podcasts this year, with 28.2 million monthly listeners compared with Apple’s 28.0 million.
• As marketers chase that rise in listenership, we expect US podcast ad spending to spike by 38.7% this year to $1.33 billion.

• Adding video into the mix could make the format even more attractive for both users and marketers.

For Spotify users: Making video more ubiquitous on the platform could help Spotify draw in even the users who have less interest in audio-only content.

• While Spotify’s podcast listenership is on the rise, at 28.2 million, it’s still low compared with the 223.5 million monthly US YouTube viewers we expect for this year.
• Video could help attract some of those viewers interested in visual content.

For marketers that use host-read ads: Sponsorships can be a lot more engaging in video podcasts, as hosts can give product demos or offer other visual aids. Plus, many of the top US podcast advertisers, such as BetterHelp, ExpressVPN, and Squarespace, also regularly sponsor YouTube creators and have visual content ready to go.

For marketers looking for more standard ad spots: Spotify has a strong track record of rolling out podcast ad technology, such as dynamic in-stream ad insertion. That’s a good sign that video ad formats and tools won’t be far behind.

Plus, the very presence of video on the app also breathes new life into existing ad formats. For example, Spotify already offers on-screen display ads, and those become far more valuable if users are actively looking at their screens.

The bottom line: Though Spotify’s forays into video have failed to gain traction in the past, this newest venture looks primed to succeed—both because of video podcasts’ existing popularity, and because of Spotify’s relentless investment in its podcasting business.