Grant Tothill.
The AdNews end of year Perspectives, looking back at 2024 and forward to next year.
Grant Tothill - SCA's Executive Head LiSTNR Audience and Growth
2024 was a year of correction for media companies right around the world. Led by challenging economic conditions both domestically and internationally, media companies were forced to course correct and look at how they best restructure to gain greater efficiencies and improved profitability.
Podcasting was not immune to the correction, given a lot of the larger investment into podcasting is driven by traditional media companies.
Whilst the correction has created a lot of commentary both positive and negative, it’s fair to say there was an enormous amount of investment across the previous three years as companies tried to scale their content slates to grow podcast audiences. While audience growth was the clear focus, monetisation lagged and in tougher economic conditions proved to be no longer sustainable.
A correction was always going to happen, and needed to, if the industry is to continue to grow.
2025 will be a year of continued correction as podcasting and digital audio evolves to match the changing audience behaviours and need states as big tech continues to drive improved user experiences with connected TV, smartphones, and other devices.
Advancement in technology will aid the podcast industry and in the case of new operating systems and AI offer creators stronger tools to use for more efficient podcast creation.
Distribution will continue to be critical. Different platforms offer different audience profiles and access points, which can aid discovery. As platforms develop their respective strategies and product roadmaps over 2025, we will see the continued growth of people watching podcasts as well as listening to them. In short, video will play a key role, along with social media to what has been traditionally an audio first medium. This in turn will create a larger ecosystem for podcast creators to gain and grow their audiences and community, and new ways to drive revenue opportunities. But it will not be for all podcast genres, with chat-based podcasts being the biggest beneficiaries in the short term.
With that said, what will continue to drive new thinking will be the three biggest challenges that the podcast industry has still not overcome - Discovery, Audience Growth and Retention, and Monetisation. I believe this will play out in various ways, and excitingly we are seeing some great steps forward which will continue.
Given Podcasting is largely driven by advertising and free to consumers, audience profiling will be at the centre of innovation both for content creators to attract, grow and retain audiences and for advertisers to achieve effective campaign outcomes with audiences they may not reach through other media at scale.
This will require ongoing investment in both AdTech and Content creation.
With the current environment, some companies may have over corrected, focusing on low-cost business models, relying only on sales representation agreements more than creating content that will grow and retain audiences. In other words, some companies have opted to hire in their audience future, allowing others to grow their skills in content creation across multiple executions and be the drivers behind new formats and opportunities.
Some industry commentators see the low cost approach as prudent. Others would argue this is a short-term approach. Podcasting is continuing to grow. Australia has the largest listening per capita anywhere in the world. With-out investment into creating new podcast formats with a focus on high quality podcasts to attract and retain both existing and new audiences, there is a real chance the industry will stall, as audiences simply have too much choice for their time, not only in the form of podcasting but all entertainment mediums.
It really is about the “attention economy”
More of the same will not grow the medium. New formats and brilliant story telling are still the foundations of podcasting. Podcast creators will take on new approaches that utilise social media, on both visual and audio-based podcast treatments. As audience need states and behaviour change, they will need to be where their audiences are.
Investment into AdTech is now fundamental and critical. We are seeing AdTech play a more important role in narrowing the gap between audiences and revenue, with one company achieving circa 70% usage by advertisers with some form of AdTech to drive campaigns.
It follows further investment into AdTech will accelerate this usage and allow advertisers greater confidence in buying podcast campaigns with measurable outcomes with known audiences. We will see the gap between audience scale and revenue continue to narrow as Podcast focused sales teams and AdTech work hand in hand along with Programmatic sales to monetise audiences.
As education grows and ad sales improve to drive the total commercial market for podcasting, we will see a new approach to audience measurement for the podcast industry that better reflects total audiences. The industry will need to move to a more standardised set of metrics and language for podcast audiences, to allow for the next level of revenue growth.
All in all, 2025 is shaping up to be an exciting year for the podcast industry in Australia. It has always been a dynamic industry. It was only back in 2016 that there wasn’t really a commercial marketplace in Australia and podcasting was seen as a cottage industry – the wild west. That has changed and the acceleration of change is positive . Podcasting is still a very personal medium. Its fundamentals to entertain, inform, teach, and tell stories are still true today. How it's created, consumed, bought by advertisers, and the knowledge we have about audiences is what will change.
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