While audiences for streaming audio and podcasting continue to ramp up, ad dollars are slowly following. Combined revenue for local streaming audio and podcast advertising is forecast to hit $720 million in 2019, up from $590 million in 2018, according to Borrell Associates. The numbers represent ad dollars spent by any company that has a local presence – from a local furniture store to Macy’s – and exclude national ad dollars.
The research firm’s latest forecast shows ad dollars for the combined digital audio platforms growing to $850 million in 2020 and hitting the $1.0 billion threshold in 2021. Zeroing in on a pair of local markets, CEO Gordon Borrell told a Media Financial Management Association webinar audience Thursday that local streaming audio and podcast advertising for 2018 in Miami was $10 million, while Phoenix booked $8 million.
Like any emerging platform, it takes time for ad dollars to catch up with audiences. “The money will come, it will just take some time,” Borrell said.
The Borrell numbers are smaller than what the Interactive Advertising Bureau (IAB) and PwC reported in November. Looking at just the first half of 2018, the digital media trade group said digital audio ad dollars (including desktops and mobile devices) soared 30.6% year-over-year to $935 million, in the first six months of 2018, from $716 million in the same period in 2017. The IAB/PwC numbers include local and national revenues. “Audio wasn’t even a category large enough to measure a couple years ago,” Kristina Sruoginis, IAB research director, said when the numbers were first issued. “Now audio arena advertising is near 1 billion dollars, which includes smart speakers and podcasting. These have proven to be viable ad models.” Nearly one out of every five ad dollars spent on digital audio during the first half of 2018 was allocated to podcasts or $168.3 million.