Podcast Advertising Growth Slowed in 2023, 2024 Rebound Expected

After many years of double-digit growth, U.S. podcasting advertising revenue growth slowed down in 2023. But there is hope ahead.

Per a new Interactive Advertising Bureau study, released Thursday and prepared by PricewaterhouseCoopers, podcast advertising revenue in the U.S. increased 5 percent to $1.9 billion in 2023, due to an overall challenging ad market that also impacted other sectors of media and entertainment. This was compared to a jump of 26 percent the prior year, and 72 percent before that. In light of the slowdown, podcasting advertising revenue was outpaced by overall digital advertising, which was up 7.3 percent, in a reversal from prior years.

A few podcasting companies were able to maintain the prior growth rate, but losses from mid-tier companies dragged the sector down overall. Amid the downturn, companies such as Spotify and Audacy conducted layoffs and made cuts to programming.

Within the podcasting sector, comedy podcasts took the biggest percentage of U.S. ad revenue for the year, with 17 percent of the total, up from 14 percent in the prior year. Comedy podcasts were the most listened to podcast genre, according to the study, and the sector gained 268 new advertisers in the fourth quarter of 2023. This is the second straight year that comedy and sports have led the pack, outranking news in third place, in terms of listenership. 

The sector also saw an increase in ad buying from consumer packaged goods related companies, as well as retail brands, which are up 4 and 5 percentage points, respectively, since 2021. 

Still, experts are projecting the sector will bounce back somewhat in 2024, as the advertising revenue in the podcasting sector is expected to grow by 12 percent in 2024, to more than $2 billion in revenue, and then by 10 percent and 8 percent in the following years. By the end of 2026, the sector is projected to reach close to $2.6 billion in revenue. It’s worth noting however, that in 2022, before the ad slowdown of 2023, the IAB study predicted podcasting would reach close to $4 billion in 2025.

The belief in the continued growth is bolstered by improvements in ad measurement analytics and leaning more into programmatic buying, as well as additional revenue tied to the production of video podcasts and hosting live events. 

Speaking to The Hollywood Reporter at the end of 2023, Wondery CEO Jen Sargent and Conal Byrne, CEO of the iHeartMedia Digital Audio Group, were also optimistic about trajectory going into 2024, pointing to the rise in daily podcast listening, as well as a continued momentum from national brands.