U.S. audio advertising and marketing spend is on track to grow14.4% this year to $18.06 billion, the fastest growth rate in 40 years, driven by double-digit increases in over the air radio (OTA), streaming, podcast, satellite and Hispanic audio ad andmarketing spend, according to PQ Media’s new United States Audio Media Forecast 2021. The report attributes the record growth to new technologies, changing consumer behaviors and shifting ad budgets.
Breaking out individual audio channels, PQ Media says podcast advertising is on pace for a 32% surge in 2021, while Hispanic audio ad spend is set to rise 16.5%. Over the air advertising is expected to increase 14.2%, and streaming audio ad spend is projected to grow 13.4%.
While the forecast calls for double-digit growth all around in the U.S. audio market, it’s important to note that the projected gains follow the steepest drops on record in 2020, when all media spending was driven down by the brutal impact of COVID-19 and the pandemic’s after-effects worldwide. Total audio ad spend, of which OTA accounts for 70%, is not expected to reach the pre-pandemic 2019 level until 2023, according to PQ Media.
However, streaming audio advertising – including digital extensions of AM/FM radio stations, podcasting and subscription-based audio services – kept growing at double-digit rates during the pandemic’s apex in 2020 and will continue to do so through 2022, the report says.
Audio Consumption Up 3%
Shifting gears to consumption trends, PQ Media says audio listening is expected to rise 3.3% to an average of 13.7 hours per week in 2021, the quickest uptick in 20 years, fueled by strong growth across all major audio platforms. Over the air usage grew 2.7%, streaming audio, including the streams of AM/FM stations and subscription-based audio services, increased at the same rate while podcast listening surged 9.9%.
Consumer spending on audio media content and tech is expected to increase 8.3% to $25.96 billion in 2021. The key growth driver is consumer spending on audio content, including streaming and satellite subscription services, podcasts and digital radio extensions. Consumer spending on audio content surpassed total audio ad and marketing expenditures, surging 12.4% in 2020, as the pandemic lockdowns supercharged consumer time spent with digital audio. Spending on audio content will grow at an accelerated 12.6% to $19.62 billion in 2021, PQ Media estimates.
“Audio has proven to be a resilient medium since its rise to the fore of the media spectrum in the 1920s, continually adapting to strong challenges posed by the emergence of new technologies, such as television in the 1950s, as well as related changes in consumer behaviors and shifting ad budgets. All three of these critical PEST [political, economic, social, and technological] trends were strongly influenced by COVID-19, but as these key variables evolved with the severe impact of the pandemic in 2020, audio media once again rose to the challenge and showed its staying power with consumers,” says PQ Media CEO Patrick Quinn. “With the continued growth in the popularity of podcasting in 2021 and the increased use of smart technology to listen to digital radio station extensions, traditional OTA broadcasts have remained the most popular audio content consumers listen to in their cars. When audio media’s three major platforms are combined – OTA, digital and podcasting – audio is a powerhouse medium like no other,” Quinn added.
Among other key trends in PQ’s audio forecast:
AM/FM will remain the primary way consumers access audio through 2023, far outweighing consumer time spent with Spotify and Pandora;
Podcasting has become the sexiest audio media channel, enticing more brands to audio that, previously, had not included this medium in their omnichannel advertising and marketing campaigns;
Hispanic audio – both digital and traditional – has emerged as a major force in the overall audio media industry, as Hispanic OTA advertising is pacing up 16.6% in 2021, while Hispanic streaming audio ad spend is expected to grow 14.8% this year, and Hispanic podcast advertising is projected to surge 38.5%.