The pod­cast train has left the sta­tion. Are you on it?

The Insider - - TECHNOLOGY - By the PressReader Team

Pod­cast­ing is at an all-time high right now, and we are see­ing more pub­lish­ers than ever jump on board. Both ma­jor legacy news­pa­pers and their dig­i­tal na­tive coun­ter­parts are leap­ing head first into the fray, from The Washington Post and The New York Times to Slate and Buz­zFeed. Where pod­cast­ing was once just sidelined to en­ter­tain­ment and sto­ry­telling, news seems to fi­nally be mak­ing its de­but into the sonic land­scape.

It wasn’t without try­ing be­fore. The New York Times bought into the pod­cast­ing hype early back in 2006 with the now­can­celled Front Page, a sum­mary of the day’s news in five min­utes. Since then they’ve launched plenty of hu­man in­ter­est and cul­tural podcasts with vary­ing de­grees of suc­cess. But it’s only now that we’re see­ing cur­rent-events-styled news podcasts gain suc­cess, largely spurred on by the ad­dic­tive, end­less cov­er­age of the Amer­i­can elec­tion and the Trump ad­min­is­tra­tion.

It’s taken some time, but pod­cast­ing is poised to hit the main­stream with news out­lets. Much like pub­lish­ers had to learn that their web­sites need to be more than just a bor­ing dig­i­tal tran­scrip­tion of their print front page, the me­dia had to learn how to adapt their con­tent to take ad­van­tage of the unique fea­tures of the pod­cast medium.

A Slow As­cent

It’s taken a long time for pod­cast­ing to cul­mi­nate into the pop­u­lar plat­form it’s be­com­ing to­day. Pod­cast­ing be­gan in 1999 as an RSS feed that ag­gre­gated au­dio blogs. It only first gained promi­nence when Steve Jobs, sens­ing a pos­si­ble new dis­rup­tive tech­nol­ogy star­ing at him in the face, added a pod­cast di­rec­tory into iTunes in 2005. From there, the medium slowly but steadily gained users, with Edi­son Re­search re­port­ing in 2006 that 11% of Amer­i­cans had lis­tened to a pod­cast at least once. In 2016 that num­ber rises to 36% of Amer­i­cans hav­ing ever lis­tened to a pod­cast, with 21% hav­ing lis­tened to one in the past month. By com­par­i­son, in 2016 only 13% of Amer­i­cans used Spo­tify monthly, 21% used Twit­ter and 28% used In­sta­gram.

It wouldn’t be un­til 2014 that pod­cast­ing would ex­pe­ri­ence its next break­through when Ap­ple launched a na­tive iOS pod­cast app on their phone. The sud­den emer­gence of the app on more than 200 mil­lion iPhones around the world fu­eled the pod­cast­ing world’s first block­buster hit, Se­rial, a true crime pod­cast that was the fastest pod­cast to reach five mil­lion down­loads and streams in iTunes’ history and is still to­day the world’s most pop­u­lar pod­cast at more than 80 mil­lion down­loads in total.

So why should main­stream me­dia get into pod­cast­ing?

Pod­cast­ing, as an on-de­mand au­dio mo­bile chan­nel, of­fers so many op­por­tu­ni­ties that vis­ual meth­ods don’t. Pod­cast­ing’s dis­tinct fea­tures as a mo­bile plat­form, re­la­tion­ship­build­ing medium, scal­able chan­nel and di­verse rev­enue stream, pro­vides key ad­van­tages over other medi­ums.

Mo­bile

Podcasts are pri­mar­ily lis­tened to on mo­bile de­vices which makes this grow­ing au­di­ence even more valu­able to pub­lish­ers. While pod­cast­ing in its ear­li­est days started on the desk­top com­puter, smart­phone mass ac­ces­si­bil­ity has en­abled wide­spread mo­bile con­sump­tion with 64% of podcasts lis­tened to on a mo­bile de­vice in 2016. Which is not sur­pris­ing given that mo­bile is now the top chan­nel for con­tent con­sump­tion at 2.8 hours per day.

On the dig­i­tal side of news, growth in year-over-year news con­sump­tion on mo­bile far out­paces the growth in lap­top/desk­top con­sump­tion and mo­bile is once again prov­ing to be the pre­ferred de­vice for news ac­cord­ing to a Pew 2016 sur­vey. Pod­cast­ing presents a mo­bile-first plat­form for me­dia to reach their read­ers, new and old, on the de­vice they use most.

As any reg­u­lar pod­cast lis­tener can tell you, one of the top ad­van­tages of podcasts is that they let you lis­ten to con­tent any­where on the go. The mode of con­sump­tion, pas­sive lis­ten­ing, com­bined with its mo­bile ac­cess al­low for podcasts to reach peo­ple at times when writ­ten con­tent can­not.

It’s a pow­er­ful propo­si­tion and opens up new ways for pub­lish­ers to com­pete for reader at­ten­tion that was never avail­able be­fore. Peo­ple can lis­ten to podcasts while driv­ing, cook­ing, work­ing, and ex­er­cis­ing and more — new spaces that me­dia and jour­nal­ism in the writ­ten form would never be able to pen­e­trate.

Peo­ple al­ready spend an av­er­age of four hours a day lis­ten­ing to au­dio, 54% of that time on AM/FM ra­dio, ac­cord­ing to Edi­son Re­search’s 2016 Share of Ear sur­vey, and the op­por­tu­ni­ties are mas­sive for me­dia if podcasts can en­ter — and steal from — this mar­ket.

Re­la­tion­ships

“From WBEZ Chicago, it’s This Amer­i­can Life. I’m Ira Glass. Stay with us.” Any reg­u­lar lis­tener of one of the most pop­u­lar and long­est run­ning podcasts would rec­og­nize this friendly in­tro­duc­tion de­liv­ered for more than a decade.

Podcasts rise and fall on the abil­ity of their hosts to con­nect and de­velop a re­la­tion­ship with their au­di­ence. Pod­cast­ing is a dis­tinctly in­ti­mate medium; episodes of­ten feel like a story or a con­ver­sa­tion and lis­ten­ers re­ally get to know the pre­sen­ters.

The in­ti­macy and re­la­tion­ship-build­ing po­ten­tial of pod­cast­ing is a pow­er­ful ad­van­tage the medium holds over other more tra­di­tional chan­nels. Few jour­nal­ists are as closely as­so­ci­ated with their work the way pod­cast hosts are as­so­ci­ated with their con­tent. And this can in­spire loy­alty and en­gage­ment in lis­ten­ers that pro­vide value to the brand.

A stronger re­la­tion­ship with the au­di­ence means hav­ing a fol­low­ing who will con­sume more, en­gage more, and keep com­ing back, all of which has big rev­enue im­pli­ca­tions. This Amer­i­can Life has built up a loyal fan base over the years, mil­lions strong, and they’ve mon­e­tized this au­di­ence sus­tain­ably through live events, ad­ver­tis­ing, and di­rect sup­port. This just barely touches on the rev­enue op­por­tu­ni­ties of pod­cast­ing which will be in fur­ther de­tail later be­low.

Scale

Ex­ist­ing in­ter­nal re­sources, like tal­ent and brand at a me­dia out­let, scale well into pod­cast­ing and can make for a smoother, more cost-ef­fec­tive tran­si­tion. Pod­cast­ing at its heart, typ­i­cally con­sists of the same kind of con­tent pro­duced by the news me­dia — al­beit in a very dif­fer­ent medium and with a con­ver­sa­tional bent. While au­dio con­tent needs to be fun­da­men­tally pro­duced and adapted dif­fer­ently than its writ­ten coun­ter­parts, the same jour­nal­is­tic skills, re­search, and re­port­ing are in­volved in putting the sto­ries to­gether.

Me­dia out­lets al­ready have the tal­ent to scale ex­ist­ing ed­i­to­rial and dig­i­tal ex­per­tise into pod­cast­ing. Jour­nal­ists, re­searchers, re­porters, ed­i­tors and so­cial me­dia/dig­i­tal pro­duc­ers all have skills well suited to adapt. From back­ground in­ves­tiga­tive re­search to per­sis­tent in­ter­view chas­ing to sim­ply know­ing where and how to dig for a story, hav­ing th­ese skills on hand means not hav­ing to start from scratch to build out a pro­fes­sional pod­cast. Scal­ing in­ter­nal tal­ent can sig­nif­i­cantly re­duce the cost of pro­duc­tion and lower the bar­rier of en­try into the medium.

Pro­duc­tion cost is also a ma­jor con­sid­er­a­tion. More so than on­line video, an­other buzzy fron­tier for me­dia brands, pod­cast­ing pro­duc­tion is rel­a­tively cheap, es­pe­cially if you al­ready have the re­port­ing staff cov­ered. Au­dio equip­ment is quite in­ex­pen­sive and edit­ing know-how is much eas­ier to find or learn in­house. A ba­sic pro­duc­tion set in­clud­ing record­ing equip­ment, edit­ing pro­grams and host­ing ser­vice, will only cost a busi­ness $500 to $2,000 in ini­tial startup costs, de­pend­ing on de­sired qual­ity. The big­ger

re­cur­ring in­vest­ment will be the time spent by the newly as­signed staff to pro­duce the con­tent and even­tu­ally find po­ten­tial ad­ver­tis­ers.

We’re even see­ing the early de­vel­op­ment of pod­cast-mak­ing apps, like Bumpers, that al­low any­one with a de­cent smart­phone to record, edit, add ef­fects and pub­lish a pod­cast from the com­fort of their per­sonal de­vice.

The low cost of en­try has given even am­a­teurs a chance to en­ter au­dio, some­times to amaz­ing suc­cess, but more im­por­tantly, it gives me­dia com­pa­nies with com­par­a­tively much greater re­sources a low-risk op­por­tu­nity to en­ter with a big splash.

An­other im­por­tant as­set me­dia out­lets can lever­age is their ex­ist­ing so­cial net­works. A sig­nif­i­cant bar­rier to pod­cast­ing is how dif­fi­cult it is to be dis­cov­ered in a crowded mar­ket­place. Pod­cast­ing, or re­ally any au­dio for­mat, is not con­ducive to so­cial me­dia shar­ing de­spite be­ing a dig­i­tally na­tive plat­form. Un­like ar­ti­cles and other vis­ual con­tent, there is no easy way to share a snip­pet or high­light from a pod­cast on so­cial me­dia be­cause of the au­dio for­mat.

A re­cep­tive ex­ist­ing so­cial au­di­ence will make it eas­ier to over­come this chal­lenge; a rec­og­niz­able brand can draw lis­ten­ers who rec­og­nize that its qual­ity stan­dards will trans­late to a pod­cast worth lis­ten­ing to.

The Daily by The New York Times is a great pod­cast ex­am­ple of a main­stream out­let scal­ing their brand and tal­ent to great suc­cess. The news­pa­per re­as­signed one of its top po­lit­i­cal re­porters, Michael Bar­baro, to launch a news pod­cast un­der the Times’ dis­tin­guished name and um­brella. His first pod­cast, The Run-Up, cov­ered the as­ton­ish­ing Amer­i­can elec­tion cy­cle and found such a mas­sive cap­tive au­di­ence that it spun out an­other news pod­cast post-elec­tion, called The Daily, which con­tin­ues to reg­u­larly top the iTunes pod­cast charts.

Rev­enue

At the end of the day, the biggest de­cid­ing fac­tor for any me­dia out­let go­ing into pod­cast­ing will be the rev­enue op­por­tu­ni­ties. Let’s be up front, pod­cast mon­e­ti­za­tion is still in very murky wa­ters and as of now, will not come close to match­ing the rev­enue brought in by tra­di­tional chan­nels. But it’s the fu­ture growth op­por­tu­ni­ties of this fresh medium and the vi­tal im­per­a­tive for pub­lish­ers to diver­sify their in­come streams in an un­cer­tain me­dia en­vi­ron­ment that make pod­cast­ing worth the in­vest­ment.

Rev­enue di­ver­si­fi­ca­tion is in­te­gral for pub­lish­ers to sur­vive an un­pre­dictable in­dus­try that is see­ing shrink­ing sub­scriber num­bers and de­clin­ing ad rev­enue in the face of dig­i­tal dis­rup­tion. We’re see­ing long-time legacy pub­lish­ers lean freshly on dig­i­tal sub­scrip­tions, pulling away from the tra­di­tional ad­ver­tis­ers they’ve heav­ily de­pended on be­fore, in the hope that they’ll find a will­ing, pay­ing au­di­ence.

Oth­ers yet are tak­ing the shot­gun ap­proach, dis­tribut­ing their con­tent any­where and ev­ery­where on global plat­forms like Face­book, Google, and other all-you-can-read plat­forms to mon­e­tize eye­balls, en­gage­ment, and in­no­va­tive spon­sored ac­cess mod­els. Still oth­ers are push­ing for even more novel, cre­ative rev­enue streams like exclusive live events, sub­scriber com­mu­ni­ties, li­cens­ing out pro­pri­etary tech­nol­ogy and even es­tab­lish­ing do­na­tion pro­grams. Most are do­ing a com­bi­na­tion, and that’s where pod­cast mon­e­ti­za­tion falls in.

Ac­cord­ing to Tow Cen­ter’s 2015 Guide to Pod­cast­ing, ad­ver­tis­ing and spon­sor­ships are the most lu­cra­tive and fastest grow­ing rev­enue sources for podcasts. The en­gag­ing au­dio for­mat pro­vides a com­pelling ad­ver­tis­ing al­ter­na­tive to dis­play ads, es­pe­cially when global click-through rates sit at 0.06 per­cent ac­cord­ing to Google’s Dou­bleClick. Early sur­veys sug­gest pod­cast ads are not dis­liked as much as tra­di­tional ads be­cause of their typ­i­cally host-read for­mat, which comes from a fa­mil­iar, trusted voice and is in­te­grated smoothly into the episode. Fur­ther­more, the lack of es­tab­lished ad rate stan­dards means CPM rates are flex­i­ble, es­pe­cially if the pod­cast is pro­mot­ing a par­tic­u­larly cre­ative, high-value ad. Matt Lieber, pres­i­dent of Gim­let Me­dia, a dom­i­nant player in the pod­cast­ing world, claims to have “the best mo­bile ad unit in ex­is­tence.” Gim­let charges a pre­mium CPM, among the high­est for podcasts, for host-crafted sto­ries about the spon­sor. This cre­ative ap­proach shows the op­por­tu­nity for in­no­va­tive ad­ver­tis­ing in a world of in­ef­fec­tive dis­play ads.

An­other ma­jor rev­enue stream is di­rect sup­port and sub­scrip­tions from the lis­ten­ers them­selves. Through sites like Pa­treon, podcasts can so­licit their lis­ten­ers to make monthly con­tri­bu­tions to fund the con­tent they love and gain ac­cess to exclusive fea­tures, like early ac­cess to episodes, di­rect in­put into the con­tent they want to hear, and passes to live events.

Canada­land, a Cana­dian news and me­dia crit­i­cism pod­cast, runs a yearly fund­ing drive to boost sub­scribers and replenish churn from the prior year. They of­fer in­cen­tives like mer­chan­dise and their pub­lished book to en­cour­age sub­scrip­tions, and try to keep their fund­ing drive within a lim­ited once-a-year time­frame to not an­noy their loyal lis­ten­ers.

Other rev­enue op­por­tu­ni­ties, though less con­sis­tent, in­clude foun­da­tion sup­port and live events. Or­ga­ni­za­tions have do­nated sig­nif­i­cant sums of money to podcasts that align with their goals. The Knight Foun­da­tion do­nated $1 mil­lion to Ra­diotopia to fund new shows and push for me­dia in­no­va­tion and sus­tain­abil­ity. Live events also pro­vide a small rev­enue stream to podcasts, but their real value is in the brand ex­po­sure and lis­tener en­gage­ment that drives hype for new ini­tia­tives.

There are still fun­da­men­tal chal­lenges to pod­cast­ing…

Pod­cast­ing has taken off, but is run­ning into tech­ni­cal bar­ri­ers that pre­vent it from reach­ing its full main­stream po­ten­tial. Chief among the com­plaints is the lack of stan­dard­ized and track­able met­rics which scares risk-averse ad­ver­tis­ers from div­ing into the plat­form. Avail­able met­rics of­ten lack gran­u­lar in­sight or de­mo­graph­ics, can vary greatly from pod­cast-topod­cast and rely some­times on bor­der­line self-re­ported data for smaller or­ga­ni­za­tions—a less than ideal sit­u­a­tion for ad­ver­tis­ers who want trusted, in­de­pen­dent data.

Down­loads for ex­am­ple is the most widely used, ba­sic met­ric, but it lacks much nu­ance, like the num­ber of lis­tens per down­load, the lis­ten­ing “drop-off” rate and the de­mo­graph­ics of the lis­ten­ers. Both are hard to de­tect without the right back­end in­fra­struc­ture that’s avail­able to only the most well-funded net­works. It’s also hard for ad­ver­tis­ers to com­pare ad rates be­tween podcasts be­cause of th­ese un­stan­dard­ized met­rics and dif­fer­ent meth­ods of re­port­ing.

Be­hind much of th­ese prob­lems is the plat­form dis­tri­bu­tion dom­i­nance iTunes holds, at 70% of the pod­cast mar­ket, not un­like the dis­tri­bu­tion supremacy of Face­book and Google for dig­i­tal news. iTunes pro­vides lit­tle in terms of con­sump­tion data and met­rics for the podcasts listed in its cat­a­log, but pro­duc­ers can­not leave be­cause most of their au­di­ence is on iTunes and the na­tive iOS app. In a more strik­ing par­al­lel to Face­book and dig­i­tal news, podcasts are at the mercy of the un­clear al­go­rithm of the iTunes chart, where many peo­ple first dis­cover podcasts.

What’s next for pod­cast­ing?

De­spite th­ese chal­lenges, pod­cast­ing still presents a sig­nif­i­cant growth op­por­tu­nity for me­dia out­lets to reach read­ers where they are — and where they are go­ing to be. Pod­cast con­sump­tion has steadily in­creased year af­ter year and shows no sign of stop­ping as it starts reach­ing into the rich mar­ket share ra­dio has long held a tight grip on. Ra­dio has stub­bornly emerged fairly un­scathed from the dig­i­tal dis­rup­tion of the 2000s and as one of the last strongholds for tra­di­tional me­dia, it’s now primed for break­ing with the on­com­ing pod­cast­ing wave.

Ad­ver­tis­ing has reached a peak of sorts among pub­lish­ers as well, where they find it in­creas­ingly dif­fi­cult to fi­nan­cially sus­tain them­selves on ad sales alone in our dig­i­tal era. Pod­cast­ing may be the ex­act kind of cre­ative medium needed to cut through the dis­play-ad noise, and of­fer a new kind of com­pelling ad more valu­able to ad­ver­tis­ers and lu­cra­tive to pub­lish­ers.

Pub­lish­ers need to pre­pare for the next fu­ture of news and me­dia now be­fore it catches them off guard in the same way early dig­i­tal dis­tri­bu­tion chan­nels did, and pod­cast­ing looks to be a vi­tal grow­ing op­por­tu­nity for me­dia to weather the next waves of change.

In­ter­ested in do­ing a pod­cast with us or want to learn more? Let’s talk.

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