In case you hadn’t noticed, everyone’s talking about the cost of living crisis right now. With food and fuel costs rising sharply and inflation (in the UK, at least) at its highest since the 1980s, it’s no wonder this is on everyone’s minds.
But before you start to nod off, don’t worry. We’re not here to talk economics – we’re just here to talk about podcasting.
With all this in mind, it’s worth asking: how will the cost of living crisis impact the world of podcasting? And what does it all mean for your podcast?
Podcasting Layoffs Are Happening
You might’ve heard that there’s been a wave of redundancies going on in the podcasting industry in recent months. For example, CNN sacked a lot of its podcasting team. Patreon let go of 17% of their workforce, including the entire security department. Acast sacked 15% of their staff in order to focus on profitability and reduce the risk of running out of money in an “extended recession”.
These redundancies are all terrible news, but are they really a sign that the podcasting industry is losing favour? In a public statement, Patreon’s CEO, Jack Conte admitted that the redundancies had to happen because he made a decision to grow the business too fast during the pandemic when there was a Creator Economy boom.
Now that we’re seeing economic slowdown, redundancies are naturally going to happen. But it doesn’t necessarily say anything worrying about the podcasting industry per se.
Advertising Demand Set to Soften… But Will It?
Audioboom recently reported that while profits were up substantially in Q3 2022, shares were down due to “a softening in advertiser demand” as a result of lower consumer spending.
However, a lot of sources indicate that in practice, ad spend isn’t slowing in the podcasting industry at all. In fact, YouTube just announced it’s going to allow advertisers to start targeting podcast listeners specifically. This suggests the opposite – that they consider podcast advertising an area that will be profitable in an economic downturn.
So while the digital media industry more generally might be preparing to take a hit, could podcasting be the exception?
More People On the Quest for Free Content
Netflix lost almost a million subscribers in Q2 2022. The majority of these losses were in the US and Canada, where they increased subscriber fees due to rising costs.
As the cost of living intensifies, subscription fees are likely to creep up across the board. And unfortunately, subscriptions tend to be the kinds of luxuries first to get the cut when people are looking to scale back on their monthly outgoings. Netflix won’t be the only streaming network haemorrhaging subscribers right now.
But the positive side effect this could have on the podcasting industry is that the quest for free content could increase podcast listener downloads. Of course, audio and visual content are two very different things, but content is still content. And new data suggests that the same audiences who use streaming services listen to podcasts too.
Premium Subscriber Numbers Taking a Hit?
Apple and Spotify both launched premium podcast subscriptions in 2021. There’s been no announcement about falling subscriber numbers since the cost of living crisis, but it will be interesting to see how paid premium subscription models fare over the next couple of years.
Spotify’s decision to make most of Gimlet’s and Parcast’s shows exclusive apparently “caused a steep drop in listeners — as high as three-quarters of the audience for some shows,” according to a statement from their union. This resulted in 11 of these studios’ original podcast shows getting the cut.
Apple also seems to be making a real effort to push premium subscriber content. In August, it launched two new subscription-focused podcast charts specifically just to push paid content.
In reality, these small subscription monthly outgoings are usually first to get the cut when people need to tighten up their budget.
What This Means For Your Podcast
While all this chat about economic slowdown and redundancies might sound concerning, don’t panic. From what we’re seeing so far, confidence in the podcasting market is clearly still strong and shows no solid signs of cooling down.
It doesn’t need to cost an arm and a leg to run a podcast. And if you’re creating great content on a consistent basis, you will have the opportunity to monetise and earn from it.