From the time podcasts were developed in 2004 until about five years ago, these on-demand audio broadcasts suffered from an image problem. The perception was podcast were the lowest rung on the broadcasting ladder. They were a graveyard for washed-up media personalities who hoped to preserve any modicum of relevancy or an outlet for wanna-be broadcasters who weren’t good enough to make the cut in traditional media.
Once broadband internet accelerated the consumption of digital media, especially on mobile devices, and mainstream personalities such as Adam Carolla moved to the medium, this perception gradually reversed course. Not only did podcasting gain credibility, program quality vastly improved. As a result, the number of podcast listeners is rapidly increasing every year, reaching record numbers in 2015. As audiences have embraced this once-snubbed medium, so have marketers for high-profile national brands such as HBO and Burger King, as well as hip startup brands like Warby Parker and MailChimp.
What does this mean for magazine publishers? In an age where periodical publishing has given way to being omnipresent across all media platforms all the time, podcasting may be the next frontier to reach a new and broader audience while generating additional revenue.
Defining an Exploding Market
When Inc. magazine editor James Ledbetter was approached late last year about developing a partnership with a soon-to-be-launching podcast network owned by his former employer, Slate, he called the decision “a no-brainer.”
Ledbetter was a podcasting advocate but previously rejected the idea when it was broached in-house. He changed his mind when presented with this opportunity to join a network with the potential to immediately draw a larger audience while tapping into the expertise and resources of the podcast pioneers at Slate.
In February, Panoply launched to leverage Slate‘s decade of sales, audience development, and production experience with the medium. By providing production resources, affordable studio time, a sales team, and a high-profile distribution channel, Panoply makes podcasting more manageable. Among the charter partners in the new podcast network were New York Times Magazine, Real Simple, Popular Science, and Inc.
“It was a no-brainer because of the relationship Slate had built with iTunes and the fantastic distribution channel,” says Ledbetter. “Even if we were going to do one on our own, we could build it for five years and not be where we are right now. We could’ve put it up on inc.com and maybe 300 or 400 people would’ve listened to it. It was a huge gift looking us right in the face.”
The overall audience for podcasts is large and it’s getting larger. In February, Edison Research released its annual report on the industry and announced the following information about the number of Americans aged 12+ who listened to podcasts:
- 89 million listened to at least one podcast ever
- 46 million listen to at least one podcast per month
- 27 million listen to at least one podcast per week
- weekly podcast listeners listen to an average of six podcasts each week
- 15 percent of podcast listeners listen to 11 or more podcasts per week
All of these figures are all-time highs for the podcast industry.
“There’s this great medium in podcasting that not a lot of people are taking full advantage of,” says Slate general manager Brendan Monaghan, who oversees Panoply.
Partnering with a podcast network with a built-in audience such as Panoply, CBS-owned play.it or PodcastOne is one path to success but not the only one. There are many examples of independent podcasts that are successful, meaning there is an opportunity for publishers of all sizes to fill the high demand for the type of content they can provide.
“Someone is going to create the content that magazine readers want to listen to,” says Lex Friedman, co-founder of Midroll, the leading podcast advertising network representing more than 200 podcasts. “Podcasting is exploding in popularity so if a magazine wants to be the one their readers are listening to, they have to be the ones creating those podcasts.”
Adds Friedman: “I think over the course of the next six months or so you are going to be hard-pressed to find a major magazine that doesn’t have a podcasting initiative of some sort.”
A Pod of Gold?
Retail follows rooftops and big name brands are following listeners to advertise on podcasting real estate. Inc. was fortunate because it launched the podcast with T-Mobile as a title sponsor. Discussions were already underway between the publication and the wireless carrier about a wide-reaching partnership for 2015. That led to an opportunity to pitch involvement with the podcast, which T-Mobile agreed to and that platform was added as part of a larger multimedia sponsorship package with Inc.
Podcast monetization isn’t just about the revenue generated directly from the podcast, but also from the “ancillary revenue,” says Monaghan. “Someone might buy the podcast as part of a larger package, so it can help drive broader business for an organization and have an impact on the bottom line.”
Continues Monaghan: “CPMs in podcasting rival, if not exceed, video, so it’s a great place to be from a monetization standpoint. We generally say 50,000 downloads per episode but that’s not a hard and fast rule. It’s not that you can’t make money with less than that but 50,000 is the number we generally point to.”
Which points to a major consideration for publishers with titles that don’t have a large, national reach. Driving a similar level of revenue may prove to be a challenge for niche, B2B, and regional publications with smaller reach and readership. However, the potential benefits of podcasting are numerous beyond the hard dollars they generate and could provide enough incentive for these categories to venture into this medium.
The Human Element
With podcasts enjoying record popularity, publishers have new opportunities to market their magazine brand and content. First, there is the potential to reach a broader audience with a pool of tens of millions listening to podcasts, as mentioned above. For example, regional publishers could potentially carve out a listening audience much like that of the many successful regional sports podcasts.
Also, a podcast puts a name and voice behind your publication, which personalizes the relationship with your audience. There’s something unique-an intimacy factor-about the audio medium that builds a relationship with an audience that’s otherwise hard to achieve and certainly goes beyond the written word, whether print or digital. It’s sometimes the next best thing to an in-person event.
“The marketing aspect that’s there is important in terms of engaging the audience and making a connection that isn’t there from reading an article,” says Monaghan. “You’re hearing their voice. You connect with them every week. Our podcast audiences are incredibly engaged and they spend money. And it’s an additional way to extend your brand editorially while reaching a new audience because the people that listen to your podcast don’t always overlap with your readers.”
Podcasting can also condition readers to consume other content on a mobile device, given that 64% of podcasts are frequently consumed on a mobile device. “When we surveyed our listeners, more than half use an iOS device to listen to at least part of a podcast and more than a third are using an Android device,” says Friedman. “I would guess if a magazine is struggling to reach its audience on mobile devices, then a podcast is certainly a way to bridge that mental gap to get an audience to identify a brand with mobile.”
To Cast or Not To Cast
There are a few factors for a publisher to consider before deciding whether or not to launch a podcast.
The first is obviously cost. The initial investment for launching an independent podcast is a quality microphone and audio editing software, so the cost of entry is low. Publishers typically use their own talent to host podcasts, integrating writers and editors, experts, and other interview subjects for content. While there’s no new talent investment, there is an editorial resource cost that needs to be accounted for.
“There’s not a lot of investment,” says Ledbetter. “The only people we’ve used are staff. We’re not paying people extra for it. Slate charges us a small fee for the studio and producer and any admin fee gets added on.”
Because of the low cost of entry, podcasting isn’t just for the national titles that join a network, which opens the space to regional and niche publications or another title of any size.
“If a magazine can be successful on a regional basis then I don’t see any reason a podcast couldn’t be too,” says Friedman.
Another consideration is whether a publisher should produce the podcast in-house or externally. Not every title can secure a network partnership. In fact, very few do. Of the more than 100,000 podcasts in the U.S., the vast majority of them are independent and self-produced.
Technology such as wearables, smart TVs, and connected cars, a.k.a. in-car media are expected to feed the demand for podcasts going forward. The connected car, in particular, is forecasted to bring the next expansion in podcast listenership. While this market is in its infancy, it’s estimated to skyrocket during the next five years. Automakers and tech companies have already begun to partner to put features in cars that are normally used in smartphones. By 2020, it’s estimated up to 75% of cars shipped globally will have the hardware to connect to the internet.
“We are very excited at Midroll for the benefits of our medium with the connected car,” says Friedman. “When a car can automatically download the episodes of the shows you’re most interested in and you don’t have to deal with pairing the vehicle with Bluetooth or anything else, then that’s a great situation to be in. I have no doubt the connected car is going to be a huge boon to podcasting.”