For podcasters looking to grow their revenue via YouTube distribution, there is some good news. WARC Media is forecasting YouTube’s advertising revenue will grow at twice the rate this year than it did during 2022, when a worldwide slowdown in digital ad spending hit the video streaming site harder than most. This year, YouTube’s ad revenue is set to grow four percent to a total of $30.4 billion. That is more than double the rate of growth recorded in 2022, with ad revenues expected to recover in the second half of this year.
The forecast marks a turnaround for YouTube, which WARC Media says saw its ad revenue decline 8.8% during the fourth quarter last year as marketers shifted investment to retail media and search and it battled against TikTok and Instagram Reels and was squeezed by Apple’s App Tracking Transparency framework that requires users to authorize an app tracking them.
“It's been a tricky 12-month period for YouTube, which is increasingly battling on two fronts, against short-form video platforms like TikTok as well as long-form content streamers in the connected TV space. However, as trading conditions improve in digital advertising, YouTube can expect to see revenue growth improve,” said Alex Brownsell, Head of Content at WARC Media.
As trading conditions become more favorable, WARC Media forecasts YouTube’s revenue growth to accelerate 10.3% in 2024, to reach $33.5 billion by the end of the year.
Retail remains YouTube’s most important category for ad investment: retailers are expected to spend $4.1 billion on YouTube ads this year, a 4.6% increase verses 2022, according to WARC Media data. Yet it says growth from other sectors has been harder to achieve. WARC Media data forecasts an increase this year in technology and electronics (+8.0%) and toiletries and cosmetics (+4.3%).
As podcasters embrace YouTube as a way to reach new audiences, WARC Media data suggests there is a lot of potential. It says YouTube reaches half of all internet users globally – or 2.07 billion people worldwide, almost twice as many as TikTok and Instagram according to Kepios. And it says more than one billion hours of video are watched every day on YouTube.
Overtaking Netflix in 2022, according to Nielsen, YouTube is the most popular ad supported streaming service in the U.S., accounting for 22.9% of OTT viewing in March 2023. It is also the most popular channel for U.S. Gen Zs to use to catch up with sports news, and last year, it was the most popular platform for both music and podcast listening in the U.S.
WARC says the Alphabet owned video platform is actively looking for ways to forge deeper connections with viewers, creators and brands through multi-format video strategies. It is doing that by prioritizing Shorts and Connected TV engagement. However, Shorts’ 50 billion daily viewer total is still way behind the 140 billion daily views achieved by Instagram Reels, while users under age 18 spend on average 60% longer on TikTok than with YouTube content.