Podcast advertising sold through programmatic platforms is forecast to double in 2020 and again in the year to come. Forecasters at eMarketer estimate $31.3 million of podcast ad sales will move through automated systems this year. That is more than twice the $15.6 million in programmatic deals that were struck last year. And analysts forecast in 2021 the amount of programmatic ad sales will total $68 million — and reach $106.5 million by 2022.
The growth rate is large, but the big picture is one of programmatic ad sales remaining a small part of the revenue equation for podcasters. “Just four percent of total U.S. podcast ad spending will transact or be fulfilled programmatically, up from 2.2% last year. That figure will increase to eight percent in 2022,” said eMarketer.
Analysts said there are several reasons why programmatic has been slow going into podcasts. The list includes the fact that some podcast publishers haven’t adopted the necessary ad tech to facilitate these transactions. It also notes that Apple, which still has about 60% of podcast listening, has been reluctant to share listener-level data with advertisers. That has made targeting and measurement more difficult for ad buyers. There is also the lingering fear among publishers that programmatic sales could reduce their ad prices and ruin the user experience. “They turn to embedded host-read ads instead,” said eMarketer.
During the Voxnest Podcast Advertising Summit in July, podcast executives said the industry is slowly warming to the idea of machine-based buying. Voxnest CEO Francesco Baschieri said between January and May there was a 65% increase in programmatic advertising buys across its network. He credited that to a flood of demand from ad categories like digital products, software, telecommunications, and insurance that were able to step in and replace the cancelled buys from advertisers in other sectors severely hurt by the COVID-19 pandemic.
Nina Harvey, Senior Director of Audio at Magnite — the former Rubicon Project — said programmatic lags compared to other digital channels where 60%-90% of media is traded programmatically. “We just need to get the pipes connected and sort out some technical challenges,” she said. “That is a way for the podcast audience to start to be made available to the big audio buyers who may already be buying audio streaming but want to now enter the podcast space.”