Podcast Media Planning and Buying Media

4 things you need to know about the podcast ad spend rebound


By John McCarthy, Opinion Editor

June 29, 2021 | 5 min read

US podcast advertising spend is projected to rise from $758m in 2020 to $2.4bn in 2025. Forrester claims that’s a compound annual growth rate of 26%. With this level of investment, it is no surprise companies like Spotify are racing to build comprehensive targeting networks in audio.


Ad buyers exhibited less interest in podcast advertising compared to other formats according to the IAB

The Drum explores Forrester’s 2021 Podcast Advertising Forecast and pulls out four pivotal trends.

Lagging growth

Podcasting growth lagged behind digital advertising in general in 2020. The report anticipates a recovery this year and acceleration in 2022.

It reads: “Podcast advertising growth will benefit from a rebound in mobility, a recovery in brand advertising, and investments by digital media platforms in better podcast monetization.”

It had the combined digital advertising revenue of Google, Facebook, Amazon, Microsoft (Bing), Twitter and Snap grow at 15% in 2020, slower than 2019’s 20% but still respectable. The digital shift and a surge in e-commerce drove that.

It estimates that US podcast advertising grew only 7% over the course of 2020. In 2019, we saw 48% growth. With 17% of podcast listens in cars, the declining commute took a bite out of growth projections.

Less interest from advertisers

Ad buyers exhibited less interest in podcast advertising compared to other formats according to the IAB. It found that podcasts would likely see the lowest spend growth of any digital ad channel in 2020 apart from digital out-of-home.

The medium had less to offer many marketers diving into performance marketing and e-commerce during the pandemic.

“Ad buyers were also presumably responding to an expected decline in podcast listen time,” the report adds.


If podcasting wasn’t the tool for the job in 2020, it is still an important medium going forward. Forrester expects growth to rise from 7% in 2020 to 27% in 2021. Still not 2019’s 48%, but a higher base of spend naturally.

The return of travel and the commute will drive listening. It predicts that lower mobility in H1 2021 will remain a drag on spending on podcast advertising for 2021.

The fact hat Stitcher’s peak podcast listening time shifted from commuting hours to lunch hours “suggests that some listeners’ podcast usage remained resilient even as routines changed”. The habit is built, and it moves.

Big brand advertisers will find themselves at home on the platform, running activity e-commerce-facing platforms can’t. “As vaccines help to blunt the pandemic’s impact in the US, businesses are returning to brand advertising in anticipation of a broader reopening of the economy.”

With 42% of podcast advertising coming from brand ads according to the IAB, this year more brands will be comfortable investing in longer-term measures.


The podcasting revenue of iHeart, the top podcast publisher in the US, grew by about $50m, or 91%, in 2020. And Spotify recorded podcast ad revenue growth of $30m in 2020. But compared to the investments made by both, these returns are small. “The combined $80m increase was still relatively small given the roughly $700m spent on US podcast advertising in 2019.”

In short, we’re still at the building and investment stage, which might also be why marketers left the medium briefly in 2020. Big tech’s moving in too. Sirius XM spent $325m on Stitcher, and Amazon acquired Wondery for $300m.

It is worth remembering that the podcast boom is coming atop a well-established radio business. The implementation of digital advertising tech into the content is adding extra value for marketers.

Forrester thinks podcasting will “siphon away radio ad dollars by cannibalizing radio listen time; it will also build on radio ad spending by boosting ad prices with better targeting”. It is no surprise radio firms are making their own explorations into podcasting to get both working in tandem. Early data from Forrester suggests that podcast ads are more influential. In Forrester’s Consumer Energy Index Online Survey, Global Consumers, May 2020, 5.8% of US respondents said that they purchased a product for the first time during the pandemic as a result of a podcast ad, compared with only 4.4% for radio ads.

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