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Podcasting’s Top Ten Spent A Third More During Fourth Quarter.


Handwringing about an economic slowdown continues into the new year as the typical first quarter softness in the ad market makes it hard for media companies to judge how much of what is happening is typical or the start of something more ominous. But there is some good news suggesting that 2023 had a decent launch pad on which to start. Magellan AI says the top ten podcast advertisers spent a combined $93 million during fourth quarter, which was a third more than what the top ten spent during Q3.


There is little suspense in who the top spender was as the online mental health platform BetterHelp was the biggest advertiser during each of the final three months of the year. Magellan AI estimates it spent $26 million during the fourth quarter overall, 24% more than during Q3.


Amazon was in second place every month and that is where it landed for the quarter with an estimated $17.5 million in fourth quarter podcast ad spending, nearly double the $8.9 million it spent in the prior quarter.


The ecommerce platform Shopify also rode the holiday spending season up to third place, as its podcast ad investment jumped 50% to $9 million in the fourth quarter according to Magellan AI estimates.


Magellan AI saw podcast ad spending building throughout the fourth quarter. The holiday season brought especially large gains in the Gift ad category, which saw spending nearly triple between Q3 and Q4 to $8.6 million. Retail spending jumped 80% to $28.6 million. And gambling ad spending doubled to $30.1 million according to its estimates.


Magellan AI’s quarterly benchmark report does show a whiff of softness in the ad market during the fourth quarter as podcast ad loads shrank five percent compared to a year earlier. The average podcast dedicated 5.92% of an episode time to ads during Q4. While that was up slightly from third quarter, a year earlier the Q4 average was 6.26%.


True Crime podcasts had the heaviest ad loads during Q4 with nearly nine percent of episode time going to commercials. Society & Culture (6.6%), Education (6.3%) and Kids & Family (6.1%) followed. Magellan says ten of the top 13 genres increased their ad load compared to the third quarter.


There was little difference in ad trends between direct response and brand awareness advertisers. Between third and fourth quarters, Magellan AI says brand awareness spending rose 20% compared to an 18% bump in direct response spending. The report says during fourth quarter, direct made up 50% of overall spend in the market, while brand awareness made up 48%.


The quarterly report shows a lot of brands are still making their move into podcasting. Magellan AI says it detected 1,718 new brands for the first time during the fourth quarter. Their spending was not huge – the average new brand spent $24,000 during Q4 – but in some cases it could open the door to much bigger investment in future quarters.


A snapshot of some of the industries that are spending the most on podcasting shows where some of the injection of new brands is coming from. For instance, the business services and software segment had 684 different brands active during fourth quarter. That included 162 new brands. And the food segment had 526 brands active, including 94 new brands.


Magellan AI says Sports podcasts continued to be the most popular destination for new brands with one in five turning on shows in that genre. About 11% of brands new to the market included News podcasts in their plans, while Comedy ranked as the third most popular destination. Overall, Magellan AI says new advertisers typically placed mid-roll ads with spots than ran an average of 54 seconds.


Magellan AI’s quarterly analysis shows that podcast ad spending continues to be concentrated among the biggest shows. It says during the fourth quarter roughly four of every ten dollars spent on podcasting went to the top 500 shows, on par with what it saw during the third quarter.


It also says advertisers spent an average of $291,000 per month on podcasts in the top 500 compared to $32,000 on shows that ranked between 501 and 3,000.


The data also shows many podcasts rely on a single brand. Magellan AI says for 12% of episodes, all spots typically available were filled by one advertiser.


Magellan AI’s quarterly update is based on data it collated from more than 10,000 brands that placed ads across 76,000 episodes during the second quarter. Download a copy of the report HERE.

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