Big brands embracing podcasts during the pandemic, and doing it in a smarter way, has helped Acast double its audience and revenue this year, and managing director for Australia and New Zealand Henrik Isaksson says the sector has plenty of room to grow.
The podcast company, which recently ended its sales deal with Nova Entertainment, had a better-than-expected year given the pandemic, meeting nearly all its targets and doubling its team. Revenue at Acast grew by 250% from last year and listens reached more than 26 million, with 60% of that being locally produced content.
Acast says most of its growth, at a time when traditional media advertising declined by a record 40% according to SMI figures, is from brands heeding advice and looking for sponsorship and integrations, with automation and programmatic accounting for less than 15% of Acast’s booking business.
“I'm still amazed by the level of brands we're seeing in podcasting,” Isaksson tells AdNews.
“We're doing business with CBA, Westpac, Google, which is one of our largest clients, MasterCard, and Visa. So brands that I didn't really think we would see.
“Podcasting is a mass media, it's not niche in the same way as it was a year ago. So the adoption and the recognition on the marketer's side is easier to understand now, and then also, just processes around enabling brands to buy sponsorship and integrations are more seamless. That’s not to say we’ve nailed that until now, but I genuinely do think that we have that now.”
Isaksson says having a dedicated sales team, which has grown to 10, has also helped with its growth. The company recently split from Nova Entertainment after three years of the radio network representing and selling the podcast platform’s audio inventory. At the time of the split, both companies said they would instead focus on their own growth.
“That's been welcomed by the agencies across the board alike, not having a mixed bag of assets like radio, social and digital,” Isaksson says.
“What they do is sell podcasts and that's it, and that really helps just guiding agencies through the process because it can get quite complicated.
“Nova did a great job for a very long time. The deal did have an expiry date, and the feedback we were getting from market was that they wanted to see a podcasting-only sales team and so we decided to do it, and it's paid off, it’s been great.”
As a sign of the growth Isaksson expects local podcast advertising to experience, which has remained relatively strong across the globe for Acast, the company is planning on adding another seven people to the team if its targets are met next year.
Podcasts have been booming for years, with new streaming platforms and traditional media players increasingly investing in the space. Some have declared that we’ve reached “peak podcast”, however Isaksson argues against this, saying advertising has not met the audience growth.
“I think a lot of that revenue that we're gunning for right now is going to come out of radio,” he says.
“And we've seen a lot of radio advertisers shifting ad dollars into podcasting - this is just based on the conversations that we're having with agencies and brands.
“Then there's also an element of social fatigue. Brands, due to the pandemic and the election in the US, don't necessarily want to spend on social as much anymore because of the negative sentiment on social media. So that's definitely helped us as well along the way.
“Q4 for us, which has been our first full quarter being independent, has been the strongest quarter we've ever seen. This is definitely due to factors including the audience shift we're seeing, the growth, the willingness to spend in podcasting, the fact that we now have case studies to show that podcasting works and is becoming really big.”
For the year ahead, Isaksson is focused on building up the company’s technology and also getting his team back into the office once it’s safe, given he’s hired and integrated the team through lockdowns.
“Hiring and finding talent is one thing, but getting them bought in on the mission and the values of the business is not easy to do over Hangouts,” he says.
“The way our business is set up, I don't think we'll ever go back to what was the norm. We were working Mondays through to Fridays, and I don't think that we necessarily need to do that anymore, but the feedback from everyone has been we want to come back to the office because we have a lot of fun, we've got a great team in place.”
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