Why Spotify is invested heavily in Podcasting
Spotify Drops $235 Million to Acquire Podcast Platform Megaphone
Spotify has made yet another multimillion-dollar podcasting investment, this time by acquiring podcast advertising and publishing platform Megaphone in a $235 million deal.
Listen on Podcast:
Purpose of Spotify’s newest investment:
It’s been known (since May 2019) that Spotify originally plunged into podcasting to make more money. With music royalties unable to support their business model, Spotify saw podcasts as an exciting new growth opportunity and invested $500 million into purchasing 3 major platforms. (Gimlet, Parcast, and Anchor)
Gimlet and Parcast are both podcast content studios which have several popular series. Gimlet, in particular, is known for best-in-class content and has won several industry awards. Spotify is getting top-quality studios that will serve as creative engines for pumping out original and exclusive content.
Anchor is a podcasting platform that provides tools to help record, publish, and monetize low-budget podcast productions.
In addition to the 250,000+ podcasts already found on the Spotify platform, most of which are not exclusive to Spotify, the purchase of podcast platforms bring fresh content to Spotifys lineup.
In a general release, the Stockholm-based streaming service indicated that Megaphone will be their next acquisition promising podcast publishers to improve their reach of fine-tuned target audiences “based on confirmed ad impressions.”
“And we’re excited to share that, once we come together, we will soon make Streaming Ad Insertion available to podcast publishers on Megaphone,” Spotify’s release continues, “the first time this technology will be made available to third-parties.”
Look at the demographics..
The demographics of podcast listeners skew younger and wealthier than other forms of media. 30% of listeners are between the ages of 12 and 24, and according to Nielsen, nearly half of listeners make more than $75,000 in annual income, sparking a gold rush in advertising revenue for the industry.
The number of Americans listening to podcasts has grown significantly over the past few years. In 2018, 26% of Americans over the age of 12 listened to a podcast at least once a month, this is a big increase over the 17% statistic reported for 2015.
As of 2020, 75% of Americans are Now Familiar with Podcasting growing 37.5% in 3 Years. Monthly worldwide Podcast Listeners Have Grown 54% in 3 Years.
76 million Americans Now Have “Smart Speakers” in Their Homes
Led by Amazon, growth in smart speaker ownership has been significant. 21% of Americans own Amazon Echo (Alexa) device, as of 2020. And smart speaker ownership overall increased by 17% between 2019 and 2020. This increase in smart speakers is giving owners more opportunities to listen to podcasts at home.
Podcasts to listen to:
Music Marketing Insider: a podcast dedicated to Music Marketing, promotion and changes in the Music Industry.
99% Invisible: a podcast about how design matters to our lives hosted by Roman Mars.
The Armchair Expert with Dax Shepard : an endless fasination with being human with interviews on personal growth.
Today, Explained: a news explainer podcast hosed by Sean Rameswaram of Vox media.