Listen to This! Podcasting and Why It’s Here to Stay.
I learned first-hand last week the best way for coping with a long journey. It’s totally free and we all have access to it. Perhaps the title of the post gives it away.
One word. Podcasts. A 5-hour trip down to Portsmouth, followed by a 6-hour ferry was surprisingly enjoyable thanks to some choice Bon Appetit episodes my friend put on for the drive (the Action Bronson interview is a great listen.) I had known for some years that podcasts were good for passing the time while driving to university, but this was the first time I was truly impressed at how engaging podcasts can be over long periods of time.
Nor am I alone in my appreciation of the iPod/radio lovechild. Podcasts are growing in popularity at a prodigious rate, particularly with younger adults. As Ofcom noted in 2018, the number of weekly listeners in the UK rose from 3.2m in 2013 to 5.9m, undoubtedly rising further in 2019. Highlighting the rapidity of this change, statistics from the US show that 65% of monthly podcast listeners have only been listening to podcasts in the past 3 years. And like me, the most popular time to listen to is while travelling, with 30% of all podcasts consumed on our commute and travels.
Back to Basics
First, we should be clear on what exactly podcasts are. While many people have listened to them, not everybody has. Quite simply, they are audio files — recordings — made available online to be listened to at once, or downloaded for later. They are collated together, serialised, and given a show title, with the same host/co-hosts and format every episode. Shows usually stick to specific broad themes, and are usually in the form of interviews or discussions, but can also come in a solo/long-form speaking format (like Dan Carlin’s Hardcore History, for example, which is nowhere near as esoteric as you would expect given the name.)
The most amazing aspect about podcasts currently are the topics being covered. The choice is vast. Politics, business, comedy, cooking, true-crime, culture, sports, and philosophy — all of which only scratches the surface. Increasing demand has only boosted the global supply of podcasts. There are currently 700,000 active podcast series, and over 29 million episodes on the internet available for download.
The New Audio Age
So how did we get here? Podcasting did not just pop-up overnight (although given its dizzying ascent in popularity, it perhaps feels that way.) The main driver behind this growth, I believe, was the personal music revolution wrought by Steve Jobs, which was then followed by the advent of ubiquitous smartphone usage. In this so-called ‘revolution’, Jobs forced struggling music companies to sign away their song rights, allowing them to be bought and downloaded individually on computers, rather than through traditional album sales.
One of the offshoots of this momentous change however, was the creation of a stable, user-friendly and secure piece of software for listening and gathering your music — iTunes. Platforms such as Limewire, had previously allowed for the sharing of audio-files (which, remember, is all podcasts truly are), but these had no standard of security or regulation, and illegally distributed music and viruses freely. Think of that time as the Wild West for audio-file sharing. It was iTunes that came as the ground-breaking software package providing a legal, reliable, and trustworthy audio hub that set a new industry standard (where one had not even existed before.)
This then offered a popular risk-free home for audio files that gave space to a fledgling medium such as podcasting to cultivate and grow. The immense cultural zeitgeist created by the iPod (the product which even had Bill Gates lamenting when he first saw it, “It’s only for Macintosh?”), was then built upon by the smartphone revolution, leading us into the society we live in today. Everyone now has a smartphone in their pocket, which means everyone has access to audio through some form, anywhere and everywhere.
With this fundamental shift in audio consumption becoming established and entrenched (where before audio was limited to radios, music systems at home, or concerts) all that was then needed for podcasts to become popular was a self-reinforcing virtuous cycle over the last decade. Recommendations by word of mouth leads to increasing popularity leads to higher ad revenues leads to more investment, leads to new shows and higher quality output, leads to more recommendations and so on.
Which brings us to today. Why are we seeing so many new podcasts starting up now? We seem to have reach a tipping point, moving past the stage of podcast early adopters, and into the mainstream, where people are beginning to understand the value of the platform. For example, part of the reason is that the start-up cost for setting up a podcast is so negligibly low. All that is required is a microphone to record the audio, and some editing software (some basic options of which are free) to clean up elements of the recording. That’s pretty much it. Higher quality podcasts might improve the recording equipment, perhaps have a dedicated recording space, and have a higher quality editing production, but the basics remain accessible for the vast majority.
Second to this, online content creators are beginning to realise and exponentially advocate the benefits of this growing medium as a new form of content marketing to complement their online presence. There is a great synergy to be found in podcasts. For content creators, the topics discussed each episode can be used as ideas for blog posts; the audio recorded makes for great sound bites across social media; even videoing a podcast interview can double your content output, as the whole video can be uploaded to another content channel such as Youtube, substantially increasing your exposure and outreach. Existing entertainment channels such as BBC Radio 4, are now also catching on and creating podcasts from their popular radio segments in order to access a younger demographic of listeners they would not usually have exposure to (as over half of podcast listeners are under 35 in the UK.)
Nor do podcasts simply complement existing media forms. As the numbers show, podcasts can earn impressively strong ad revenues due to loyal and highly engaged audiences. Ad revenues from podcasts grew exponentially from $69 million in 2015 to $402 million by 2018, and is forecasted to reach $659 million by 2020. As Tim Ferriss, host of The Tim Ferriss Show, one of the most popular business and investing podcasts in the US (and one of my personal favourites, listen to his great interview with Jamie Foxx) repeatedly comments, although he intended for his podcast to be a brief experiment into the medium, it is now his greatest income stream, and funds his other avenues of interest such as angel investing, writing his books, and running his blog.
Turning On, Tuning In, Not Dropping Out?
Money is clearly being made from this audio lovechild. There would not a be such a proliferation without this simple fact. Part of the reason why podcasts are viable money makers is the level of audience loyalty and engagement to podcasts. Unlike traditional adverts such as on TV, where they are often ignored, listeners are far more likely to take note of what is being advertised on their favourite podcast, and will consider the product more seriously than other forms. Why is this? Why are podcasts so popular, and why are the listeners so much more engaged? These are important questions that get to the heart of podcasting success.
Why listeners remain engaged with podcasts is worth unpacking into its constituent parts. Podcasts make money through their advertising revenue, which can be understood as follows:
Therefore, we can consider listener ‘engagement’, in two ways. First, why do we find more active than passive listeners of adverts on podcasts than on other mediums? And second, why are the listeners more interested in the adverts, and more likely to engage with them?
There is a threefold reason for why there are so many more active than passive advert listeners than on other media forms. Firstly, podcasts are listened to on demand, at a specific moment when a listener wants to focus on the subject, not as continuous background music like radio. Secondly, podcasts are for the majority short in length (anywhere from 20 minutes to 1+hrs), a short enough time conducive for paying attention. Thirdly, as episodes often explore personally interesting topics in depth, we are kept highly engaged throughout, to the benefit of the ensconced adverts within.
As to why there are more active listeners of podcast adverts specifically, it is worth turning to Robert Cialdini, who wrote about the 6 principles of persuasion in his book Influence: The Psychology of Persuasion. It is the first of these principles which is most applicable here, that of Reciprocity. This principle, which we are all subject to, dictates that when we are given a gift or a favour, there is an immense subconscious psychological pressure on us to reciprocate with a favour or gift of our own. We feel obligated to return a kind gesture to assuage the social blinkers that want to ensure we are a valued tribe member and not a freeloader.
Picture the flower seller in a tourist hotspot that forces an unwanted flower into your hand which inexplicably makes you feel that you need to give them some change. This is that same principle. With a podcast, we are being given the favour of a high-quality piece of entertainment and discussion on a topic of interest for free. Oftentimes, the listener feels obligated to reciprocate in kind, by listening to the adverts featured and actively consider them, as a return gesture to the podcaster’s kindness. It’s the feeling that, “They’ve given me such a great product to enjoy, it’s the least I could do for them!”
This sense of obligation is further heightened by the personability of podcasts. The most successful of them feel personal. Particularly with a podcast you subscribe and listen to regularly, you feel a connection to the hosts, what sociologists homophily — an increased sense of connection to those perceived to be similar to us.
Further to this, we are social animals. We love communication — stories and conversations. We like people who communicate well, and entertainers who can tell interesting and engaging stories (Abraham Lincoln was famously one of them). Listening to podcasts can be like listening to those same stories, listening in on a fascinating conversation. It’s an on-demand version of the story round the fire. By having a repeat host that we recognise in conversation around interesting topics, we get that positive feeling of social interaction, and by feeling a connection to the host, our feeling of obligation is heightened.
With this alluring mix of short listening times, interesting topics, feelings of personal obligation, and the on-demand listening style, successful podcasts continue to retain highly engaged audiences, who are far more likely to listen to an advert and thus increase its conversion rate (and thus payment to the podcaster.) The conversion rate of these adverts is then spiked further by the nature of the listening audiences in question, who can often be categorised into their specific interests and then targeted precisely with the types of adverts that are relevant to their situation. This is why podcasts are becoming more viable financially, and why we are seeing more being started by budding sound-wave surfers.
This also helps explain the popularity of podcasts. They’re personal. They’re relevant. They’re interesting. They are exactly what you want to listen to on demand, and you can multi-task while listening to them. And on journeys in particular, unlike music and radio where you focus on the road and passively listen to the music, podcasts are engaging and you end up distracted from the monotony of the journey — you lose track of time.
Perhaps once you have experienced the power of these little audio packets on a long journey to Portsmouth, you’ll understand what I mean.
Happy listening!
OCM
