Video Didn’t Kill the Radio Star: Why Video Publishers Are Investing in Podcasts

Podcasts, reminiscent of a time when radio was king, have become a new area of focus for video publishers looking to reach audiences in new places. Refinery29, CollegeHumor and Tegna have decided to test their luck with the format in recent months, investing an increasing amount of resources into experimenting with their own audio-focused content. Publishers are chasing a younger audience that has climbed in recent years, as millennials in particular flock to everything from true-crime hits like “Serial” to comedian Joe Rogan’s interview shows. A 2019 study from Edison Media/Triton Digital estimates that 51 percent of the population now listen to podcasts — up from 46 percent at the start of 2018. Advertisers are also big on the format. U.S. podcast advertising captured $314 million in revenue in 2017, a rise of 86 percent from $169 million in 2016, according to the latest IAB/PwC Podcast Advertising Revenue study. And research predicts that revenue will surge to $659 million by 2020 (a 110 percent hike from 2017). “Whether at home on a smart speaker, at work on a PC, or somewhere in between on a mobile device, more and more Americans are listening while they live, providing a robust podcast platform where advertisers can connect with today’s consumers,” David Silverman, a Partner at PwC US, noted in a recent study. Following this increase in demand for audio entertainment, For advertisers and publishers, podcasts are a way to reach a younger, more affluent audience with more buying power than the average consumer. According to the Edison Media/Triton Digital study, 45 percent of monthly podcast listeners have household income over $75,000 vs 35 percent for the total population. One reason publishers are pushing into podcasts is because of how cost effective it is to produce the content, which can garner similar engagement to premium video. “Video podcasts have been remarkably successful,” CollegeHumor’s chief content officer Sam Reich told TheWrap. “I shouldn’t yet be specific in terms of the numbers, but I can tell you that we now have a podcast that’s more popular than one of our premium shows. Which is fascinating.” CollegeHumor, which has 13 million-plus YouTube subscribers and its own SVOD service, launched five podcasts just before the start of the year, which are distributed across multiple platforms including Apple’s iTunes and YouTube. The format, which Reich said has been most affordable to produce from a cost per minute perspective, has been a promising venture so far. “You wouldn’t necessarily think that a [podcast] would have higher engagement than a scripted narrative show which cost hundreds of thousands of dollars to make, but we’re getting there,” he said. “Folks are really, really engaged with them.” CollegeHumor expects the format to play a bigger role in its content portfolio. “In terms of our effort and expense, podcasts are really only a 10 percent of that equation and I think over time I expect them to become more like 30 percent of that equation,” Reich added. Refinery29, which started experimenting with podcasts in 2015, also likes the low-cost benefits of working with podcasts but also sees the format as an opportunity to expand on existing verticals. The company’s “Money Diaries” podcast, which premiered in March, was based on the company’s editorial vertical and book by the same name, and its “UnStyled” podcast originated from a hashtag on Instagram from its global editor in chief and co-founder Christene Barberich. The kicked-back, conversational feel of podcasts like “Money Diaries” has struck a chord with consumers looking to dig deeper into a subject or listen to their favorite personalities have a long-form conversation that goes beyond the quick hit programming found on Facebook and cable networks. “It’s a nice change in pace from typical television programming,” Ali Esmaeili, a student at Queensland/Ochsner Clinical School in Louisiana, told TheWrap. “And it feels more authentic than a talk show or a regular news program.” Esmaeili regularly listens to “The Drive,” an hour-long medical-focused podcast hosted by Dr. Peter Attia. Unlike video, podcasts allow for multitasking, said Esmaeili, who works part-time as a driver for Lyft. “I don’t have a whole lot of free time between studying and work, so it’s nice to be able to listen to something [other than music] while I’m working out or driving.” For the news broadcaster and video publisher Tegna (which broke off from Gannett four years ago), podcasts offer a new way to breathe life back into hundreds of hours of old news footage from its more than 40 broadcast operations. The company’s first audio project, “Bomber,” which launched in March, tells the story of how law enforcement hunted down the 2018 Austin serial bomber and is based on reporting from Tegna-owned KVUE TV station in Austin, Texas. “We have decades worth of true-crime stories across the archives of our TV stations that we’ll be able to draw upon for this initiative,” Tegna chief digital officer Adam Ostrow said. “For example, with ‘Bomber,’ we have all of the coverage of the serial bombings that our station in Austin did last year, as well as hours and hours of audio and video that never made it to air.” The podcasts also enable the company to engage consumers nationwide for work that had initially been developed for local or regional consumption. “We’re expanding the audience geographically as well as the hours available to us during the day,” he said. Like most of the video-centric companies venturing into podcasts, Tegna does not yet have plans to monetize its content, instead aiming to create programming that resonates with audiences. “Our primary focus, for now, is on producing great content and building an audience for our shows,” Ostrow said. “But we think audio is a great ad format, so we will certainly look to integrate advertising down the road.” Refinery29, on the other hand, has already been working with brands like the lingerie lifestyle retailer Aerie (owned by American Eagle Outfitter) to sponsor the third season of “UnStyled.” “It’s also about finding the right brands to integrate into the podcasts,” said Emmerich. “Building impactful collaborations like that is everything for us (and our audience), and that’s something that we look to do across all channels. On the other end, we’ve also seen a noticeable increase in clients interested in exploring podcast branding opportunities, so the space is widening from both sides of the field.” Advertisers who can leverage the podcast audience may find a greater ROI since podcast listeners tend to spend more, Nielsen Audio sales director Bruce Supovitz noted in a recent study examining the grocery spending of an average podcast listener. With over 500,000 separate series on Apple’s iTunes alone, podcasts cover a broad range of genres and topics, from talk radio format to fictional, serialized stories like those from Gimlet Media, which, as a result of the popularity of its content, has sold its IP to both Amazon and ABC.  Going forward, the number of podcasts being produced by video publishers and influencers is expected to continue to rise. And as Rogan, the former host of “Fear Factor,” attracts guests such as Twitter CEO Jack Dorsey, Actor Mel Gibson, Mike Tyson, and Tesla CEO and SpaceX founder Elon Musk, it’s evident that the format has become a mainstream way to reach the masses.  Rogan’s two- to three-hour podcasts regularly attract between 800,000 to as many as 5 million views. His interview with Musk currently stands at 21 million views, while a recent interview with InfoWars conspiracy theorist Alex Jones raked in 10 million views.