Six Podcasting Predictions for 2013
What’s the secret to podcasting’s success? It’s fun, with an air of spontaneity. It’s intimate. It’s engaging. Most importantly, it’s driven by passion. Our industry’s biggest luminaries — my business partner Scott Aukerman, Paul Scheer, Chris Hardwick, Marc Maron, Jesse Thorn, Kevin Smith and Adam Carolla — have created TV shows, appeared in films and continue to perform live shows. But no matter how busy they get, they still do their podcasts every week. Sometimes more than once a week — because they love it, and so do their listeners.
So where does that leave us for 2013? Here are my six predictions:
- More Money
The revenue trend is decidedly up, led by advertising dollars (70 percent of our revenue comes from advertising). Earwolf surpassed $1 million in revenue during 2012. That’s up from $190,000 in 2011 and $19,000 in 2010. We started with a $30,000 initial investment with no external funding. We’ve paid out $300,000 to our artists — something that makes us proud. We’ve created jobs. However, our pre-tax profit is only $80,000. Not exactly margins that have venture capitalists knocking down the door.
With more networks and sponsors than ever, the net effect is higher pay for podcast hosts and more profitable networks. As the risk decreases for producers, the pay goes up for artists. More networks equals more competition for talent and downward pressure on costs due to operational scale.
- More Advertising
Marketing expert Seth Godin said it’s a bad idea to try and sell something to a stranger. He’s right. For a few years, I chased ad sales from conventional advertisers, but I realized that most people just weren’t ready. So I started focusing on providing better information and service to parties who were interested in sponsoring our shows. The results have been outstanding and get better with each passing month.
The biggest problem with podcasting ad sales is that by and large, the hosts aren’t great at selling, executing ad reads or reporting to their customers. And no one who actually understands ad sales is using their expertise to tackle such a small, fragmented and immature market. There’s a lack of leadership across the industry.
I’m working to change that in Q1 of 2013 by launching a low-fee ad marketplace connecting networks and independent podcasters to sponsors. The marketplace will be open to non-Earwolf podcasts. I’m aware that I could be destroying one of the unique benefits of joining Earwolf — making money through ad sales. While that’s scary, it’s not as scary as it would be to watch someone else do it to us.
- The Rich Will Get Richer
Networks will grow stronger. There are almost 250,000 podcasts in the iTunes store. It’s increasingly difficult to identify what’s good. Earwolf produces 10 of the top 75 shows in comedy, but it’s hard for others to break through that wall. As it gets easier to start a podcast, listeners will trust the networks more. Perhaps equally important, so will the editors of major aggregators who can’t listen to tens of thousands of shows before deciding what to feature.
Currently successful independent shows will become more valuable to the networks. Anyone who’s launched a show in the past year knows that the overnight sensations no longer exist. Being early mattered. It’s no longer early. For plenty of new shows, it’s too late to get big fast.
- New Shows & Innovation
There’s good news for the independents or the shows that don’t yet exist — there are still too few great podcasts. We need more; maybe you’ll give them to us. Creative innovation is still in the early stages. Just because the networks will get stronger doesn’t mean they are the only game in town, and their weak spot is the up-and-comer, the subversive.
- The Audience Will Continue to Rule
Our listeners are the key to our success. Their loyalty and engagement put other media consumers to shame.
The tech world is gaga over “mobile this, mobile that.” Podcasts are inherently mobile. You listen wherever you are — at home, in the car, on the train, at work, while exercising. Try consuming video that way. It’s impossible. I don’t care how short the videos are. On top of that, the shorter the content, the less engaged and loyal the consumers can be. The less their attention is worth to sponsors.
The cost of producing audio is two percent of the cost of producing video. But you say, “audio can’t go viral like video.” Great! Let’s build our audiences slowly but with integrity. I’d rather have 10,000 real followers on Twitter than 100,000 transients and bots. Podcast listeners are sticky. And sticky is hard to come by in the 2013 world of media.
Still, growth is slowing. There are more episodes than ever and not as many new listeners to keep up. In 2012, Earwolf went from 1.8 million downloads a month to 4.6 million a month, but I expect download growth in 2013 to disappoint.
- Ventures Beyond Podcasting
Podcasters who are able to extend into other media will win in the long run. Anyone willing to listen to an 80-minute audio file sight unseen will also watch your movie. Or TV show. Or Web series. Or read your book. The reverse doesn’t hold true. Try taking a million subscribers from your YouTube channel where you post two-minute videos and ask them to listen to your 80-minute podcast or watch your 90-minute movie. It’s very difficult. Podcast listeners are willing to mobilize to other content mediums. In a sense, they are platform-agnostic. That is extremely valuable.
At Earwolf, we’ve started a TV development and production entity because of this shift. We’ve sold our first script and are signing a first-look deal with a cable network. So while podcasts are important as standalone content, opportunities to expand into other mediums will continue to grow.
Things That Won’t Happen in 2013
- Podcasts replacing radio in car dashboards (it’ll take longer to win that battle than most think)
- Anheuser-Busch as a sponsor (while advertising gets easier and easier, the current structure makes the support of the biggest buyers difficult)
- Disney buying Earwolf (podcasting’s perceived value to established media companies won’t take that kind of leap in one year, and we aren’t selling anyway!)
2012 has been a great year for podcasters and their listeners. Forward strides will continue in 2013, albeit with a few roadblocks along the way. I can’t wait to see what happens.
Jeff Ullrich is the CEO and co-founder of the Earwolf podcasting network. Earwolf has produced 26 — mostly comedy — programs, which are downloaded 45 million times a year. He lives in Los Angeles with his wife and daughter.