Motley Fool hosts Ricky Mulvey, Dylan Lewis, and Mary Long were live at Podcast Movement, and they discussed:
- The macro landscape for advertisers.
- Podcasting's shift to video.
- The real value of your time to marketers.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our beginner's guide to investing in stocks. A full transcript follows the video.
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Ricky Mulvey: We're live at Podcast Movement, and you're listening to Motley Fool Money. I'm Ricky Mulvey joined live at the Residence Inn with Mary Long and Dylan Lewis. It's so good to see both of you in person. This is a rare opportunity.
Dylan Lewis: It's a rare opportunity. I think this is maybe the second or third time I've ever recorded a show in a hotel room.
Ricky Mulvey: Yes.
Dylan Lewis: I'm excited to be doing it again.
Ricky Mulvey: This is the pirate radio of podcasting. There are studios there. You don't need it. We got a table. We got Dan Boyd. We got mixing board. We don't need any of that.
Mary Long: It's down to Earth. It's authentic.
Ricky Mulvey: We've only been at Podcast Movement for less than a day. But how are you enjoying it so far? What are some things you've picked up?
Dylan Lewis: It's been fantastic so far. I think there's an energy to being around a bunch of people who do the same thing that you do and are as equally excited about it. Especially in the virtual world, where we're doing a lot of our stuff from home. It's easy to lose sight of the fact that there's a lot of people who listen to the show and also who participate to make shows, and so that's fun. I'm thriving on that.
Ricky Mulvey: One of the coolest things is you meet interesting people who are curious about niche topics. It can be hit or miss. This is a convention. There's a lot of entropy here, but that part has been a lot of fun. Mary, how about?
Mary Long: People that are interested in niche topics, but also, again, like Dylan said, people that are all interested in podcasting and telling stories in an audio format and sharing that. Even you can meet somebody who runs a podcast on the legal issues of podcasting. As Ricky and I met last night at one of the networking parties, and you can still have something to talk about, even though typically, I'm not chatting with people about legal issues.
Ricky Mulvey: We're going to talk about general trends in advertising and media a little bit later, but it has been interesting for me to see the number of podcasts about podcasts. Podcasting exists in a circle sometimes. We've seen a couple of the sessions. Any key takeaways that you've picked up from those.
Dylan Lewis: Well, so far in the morning, we've seen Steven Bartlett, diary of a CEO. We saw Ira Glass, the grandfather of podcasting, and that's a pretty good kickoff. It's about as good as it gets. Steven Bartlett was interesting. I actually had been in a car on the way here in a lift, and his show was on. Then I showed up, and I was here we are, recognizing the voice, hearing again. That was neat.
Ricky Mulvey: It's cool to see Ira Glass and walk by him and go. That's Ira Glass. That's the granddaddy of this thing. He's a real human. He is a real person. Mary, how about you?
Mary Long: I thought, listening to Stephen talk, he had a lot of really interesting things to say about details, and how much experimentation can go into an interview show, which on the surface might sound pretty simplistic or simple. You talk to somebody. You ask questions. They answer. He's talking about, when I say detail, he's talking about measuring the parts per million of CO_2 in a room to make sure that people aren't too drunk on the carbon. That is a crazy level of detail to go into when just chatting with someone. Those are the types of things that he measures on a show. We're not necessarily going. We didn't do that today before recording in person at the residence inn. But there's little takeaways about how you can experiment and look at interesting details to try to make a show just slightly better.
Dylan Lewis: On that note, one of the things that I was amazed by was he was talking through some of the interviews that he had done and some of the prep for it. He talked about interviewing Daniel Eck, CEO of Spotify. He said when he was coming into the room, he had, I think Swedish House Mafia playing because Daniel Eck loves Swedish House Mafia, and he was just trying to prime the pump to have him excited for the conversation. I don't know, maybe that's something we need to be thinking about doing.
Ricky Mulvey:: I think that's a good idea. One more on that is I like thinking about things in terms of being 1% better. I like that he brought that up. He talks about how it's easy to get trapped into the next big innovation. That's honestly what we're looking for as investors, if you're looking at a rule breaking company, who's absolutely just disrupting something. But realistically, if you're working somewhere, if you're working on a project, it's much better to be motivated by a 1% consistent win thing. Tell you speaking nice interactions. I do have a story. We'll see if Dan cuts it. This is my favorite so far. I was waiting in line. You always ask, what's your podcast? What are you doing? Guy tells me he's I'm looking for a co host for a show I want to do about loneliness. I'm that's.
Ricky Mulvey: It's pretty on the nose.
Dylan Lewis: That's something a lot of people deal with. That's pretty interesting. You get a co host, and then you're going to talk to people about how they've overcome loneliness and maybe get some actionable things. Guys, like no. It's just going to be about loneliness. I really I'm hoping he finds his partner. I hope this works out for him, but so far, I think that's been my favorite interaction. Dan, thinks it's made up.
Mary Long: You got to find this podcast. Proof them wrong.
Ricky Mulvey: Let's get into some high level stuff. This is the business part of the show. Because there's a lot of talk. There's podcast industry trends. There's higher level media trends that become apparent here. I think Jeff Green in the latest Trade Desk earnings call summed up the state of play pretty well with basically talking about a conversation he had with a chief marketing officer. Describing this advertising landscape is one with "the illusion of growth", where it appears that companies are doing well, stock prices are up, but the average consumer feels more constrained than ever in terms of purchasing power. That has significant implications on how companies market product from a pricing to packaging to advertising. Let's go then. We each have two takeaways from the audio industry, from the ad industry. We'll go Dylan, Mary, and then me. Dylan, kick us off. What is a takeaway that you've seen?
Dylan Lewis: I think on that note of Jeff Green, talking about the ad industry, something I know we're supposed to be very excited about the podcast industry here. I will caution. I think the Podcast ad industry is probably one to watch for a general slowdown in ad spending and consumer activity in general. It's not because I don't love it, but it's because in the grand scheme of where Spen goes, podcasting, I think still is probably toward the bottom of a lot of marketers' lists. It's true when you look at overall digital spend and a lot of the spaces that money tends to go. I think podcast spend about $2 billion for 2024 for context, I think digital video spend, about $60 billion. I think if we see any sensitivity with podcast spend, if you start listening to episodes, and you start catching gaps in those episodes where there would be a normal ad firing something like that, it's probably a sign that there's going to be a little bit of weakness in some other places.
Ricky Mulvey: They're looking for that really not quick, but measurable return on investment. For a lot of podcast, advertisers, even though you're seeing top of the funnel, just awareness marketing, which we've done a few of those ads on this show. The primary thing that marketers are looking for is for you to enter a code at a website so they can directly track where you've come from. I wouldn't be surprised to see things slow down a little bit in that area, too. Mary, how about you?
Mary Long: The thing that I keep seeing everywhere is video. I feel that's not really a surprise, but what's interesting to me is from a creative standpoint, how you tell a story in an audio format versus a video format? To are different mediums.. They are best suited for different stories. Why at a convention that's geared toward audio story tellers, do we see this push toward video? If, if again, they are formats that are best suited toward different types of stories. It's largely because video is a growth mechanism. That's a way to grow a podcast. You can you're telling the same story, but you're using something like YouTube to grow the show. I don't know. I just think that that growth whether you see audio become a springboard to a video podcast becoming a totally different way to tell the original story. That'll be interesting for me to watch or if it just continues to be no, it's just the video version of our podcast is just sitting around on headsets, talking.
Ricky Mulvey: There's video options from Spotify coming, and that's something we were talking about earlier, Dylan is the YouTubization of Spotify.
Dylan Lewis: I think that's something to watch. It will take a long time to happen, but we see a drumbeat here of encouraging creators to make video content. Steven Barlett and his conversation was talking about how he doesn't view what he makes as a podcast. He uses it as a show. If you think about it that way, you have these different avenues for where the show can go. You have the audio expression of that. You have the video expression of that, you have clips that are going out there. I think more people are going to be thinking about it that way because for one, if you're a creator, it diversifies you away from any one specific platform. But also Spotify is pointing people there. They want people to be doing that.
Ricky Mulvey: I would say one thing I've seen in this. I went to one Podcast movement in 2019, 2023, 2024. This gets into video a little bit, but there's generally been, I would just say, a hardening of the podcast industry. You used to see companies spending a lot of money on limited series where we'll find a sponsor, and then the ad dollars will come later based on the number of listeners that they're able to attract. I think that's largely over, and you've seen that at Spotify two with shows like heavyweight leaving. Also just fewer people, I would say, who are here trying to make podcasting a second job or a full time job. Interest rates may have changed a few things here. Speaking of hardening of the industry, I was at an advertising session on just what brands are looking for in shows. One of the things they did is they said they gave a number for basically a listener's time per hour listening to podcasts. This includes content and the ads in the average hour of podcasting. Then I took this to the length of a human life.
Dylan Lewis: As one does.
Ricky Mulvey: As one does to just see how do marketers value this thing. I got a number that I got to, but I'll pose it to Mary and Dylan. We'll say, Dylan saying, we start from 10. Age 10. Zero through 10 don't count for an advertiser. We'll see sugary cereal. I don't know. We'll do 10-72. You wake up in the morning, you only listen to podcasts, and then you sleep eight hours at night. Sixteen hours a day for 62 years. How much do you think that is worth to the marketer. The marketer saying, but does it scale in a board room?
Mary Long: I feel I'm back to being a child looking at a container of M&Ms at the library. I have to guess how many are in there. I'm going to be wildly off face $5 million.
Dylan Lewis: Five million dollars. I want to say first that that sounds like a terrible existence. As much as I love listening to podcasts, nonstop for 62 straight years.
Ricky Mulvey: That's right.
Dylan Lewis: I'm saying that loud because 'cause I need to reason through this aneral, but 62 years Mary's five million sounds pretty good. I'll go three million.
Ricky Mulvey: Three million, Dan do you have a guess you want to do? I know I'm putting you on the spot.
Dylan Lewis: 2,999,999. [laughs]
Ricky Mulvey: Dan going for the prices, right answer, $2,999,999 repeating. Cool, Dan. We're all off $22,000. Wow.
Dylan Lewis: Tell that we work in the Podcast industry.
Mary Long: Dan, where is that sound effect? [laughs]
Dylan Lewis: That has made me a little bit mindful in terms of the time I spend watching ads where you realize this is how maybe marketers are valuing my time. I should say there is a sliding scale for podcasts, I don't know if it's two inside baseball. This shows for investors, so advertisers pay more to be here. But basically, they value your time. It's $0.06 per hour listening to a podcast, including content. It's $0.08 for radio, $0.08 also because there's way more ads listening to a radio.
Mary Long: Here's a question that we might cut. How much of that is because on a podcast, like platform, you can just skip over the ads. I can do that on Instagram, but less likely to.
Ricky Mulvey: This is just an average out from a media consultancy study.
Mary Long: But that's why I'm thinking it's got to be so low because it's so easy to pass by the ads.
Ricky Mulvey: Maybe.
Dylan Lewis: Well I guess my question on that. Wanting to dig into it is, how do you take that number and then reconcile it with an industry that has $30-$50 CPMs for shows that have relatively affluent audiences? Advertisers must have some justification for that.
Ricky Mulvey: I think CPMs change also based on, you're in the strike zone for investing podcasts, but there's a lot of sports, true crime news podcasts where that goes down a little bit. Also, the ad load for a podcast is significantly lower than something like radio. Shows are less willing to put a bunch of ads on the show because we've seen what happens to radio. Another big trend. On big trend, the media consultancy group M expects total worldwide ad revenue spend to surpass $1 trillion in 2025. They're looking at a few things. One is digital growth. The second is growth in China, more ad spend there than anticipated. The other trend that they're expecting is that by 2029, just five years away, connected TV ad revenue, stuff on Roku is going to overtake traditional TV revenue. Both of you, any reaction to that big trend. Any surprise there.
Dylan Lewis: I totally buy that. I absolutely buy that. I think what we see with digital advertising in general is it a much more advertiser friendly environment. You have tracking, you have much better targeting. When we look at traditional media, it's big in the audience that it reaches, but it's an incredibly blunt tool.
Ricky Mulvey: Mary.
Mary Long: Got nothing to add.
Ricky Mulvey: You got nothing to add. There we go. I will go to one other trend before kicking it around. One thing I'm seeing more here. Can you guess what I'm seeing more here than I saw in 2019? One trend that advertisers are so happy to talk about in Podcast. They're going to help you with it. It's a thing they're going to help you with. I'm doing a lot of quizzes.
Dylan Lewis: Is it AI?
Ricky Mulvey: It's AI. I think AI is in an interesting spot for advertising for a couple of reasons. One is I'm interesting to see, and this is outside of podcasting, just display ad growth. The banners on websites, and how that's going to be hit by Google just summarizing stuff when you search. One place that we might be seeing that is problematic. They sell a lot of display ads, and for them, that display ad growth slowed to 2% year over year. They would point to a craziness with a buyer canceling an order issues with Yahoo and a change to their sales platform. But I do wonder if a lot of these display ads are going to continue to face, and I'm using quotation marks, headwinds, is more people just get information straight from search without visiting a single website.
Dylan Lewis: I think that's entirely possible. I think that's one of the big existential risks for a company like Google when it comes to just the way that people are accessing information on the Internet.
Ricky Mulvey: The other thing we're going to start seeing that I heard a experimentation with because brands are uncomfortable right now. But I think there's going to be more AI host red advertisements. They know, Dylan, that you live in near.
Mary Long: I know Ricky doesn't know. [laughs]
Ricky Mulvey: I know. Well, I was like I don't want to give too much Dylan information away. Dylan.
Dylan Lewis: At home game here in Washington DC.
Ricky Mulvey: They know what colors you like, they know maybe your physical activity, they know what teams you're interested in. Your favorite podcast host could appeal to you with your name, with customizable information in order to sell you shoes or meal kits.
Dylan Lewis: I don't know whether that concerns me more as a consumer or as a podcast host. Because I don't really like the idea of being a part of ultra targeted AI marketing.
Ricky Mulvey: That's coming, though. It's going to be like Cloud Atlas from David Mitchell, where they're just showing you things that are exactly what you want that hit those stimulation buttons better than they're able to do with mass targeting. Mary shaking her head.
Mary Long: Well, I loved the Cloud Atlas, David Mitchell reference, but I was not expecting that?
Ricky Mulvey: I'm going to kick it to Mary. Any other big trends you're noticing in advertising or from the conference perhap?
Mary Long: From the conference, I think another thing is just like the effect of the influencer and how that plays into podcasting. There are obviously exceptions to this, but it seems like there are two large buckets. Again, there are exceptions, but it seems like there are two large buckets of people who start a podcast. One is you're an existing brand and you want to use your brand to start a podcast, to pursue your own interests. Or you are just a person that wants to build a brand by carving out a niche within your interest. If you are a person who wants to build your brand, but you're just a regular person who wants to build your brand by building a podcast that caters to people that share interest is similar to you. That's a really crowded market, even if you're playing to a niche interest because people only have so much time to listen. How do listeners find that podcast in a crowded market. I think that that's a hard question to answer. How you see that play out will be interesting to me.
Ricky Mulvey: I think there's also hobbyists in there, where people who are just like this seems fun to do. It's basically everyone can have their own public access show. This one, Dan, is not a bit. This happened last year, and it was in Denver. I promise it's a real story. I was talking to a podcasts and the first question, of course, what's your podcast? What's it about? It's an interview show. She told me that her podcast was a great way to find closure in a relationship because she had her ex boyfriend on the podcast, and then did an interview for two hours. Still and Louis reactions to that. Do you think we should start implementing that at the full?
Dylan Lewis: I'd prefer we didn't. [laughs] You need to have a thick skin to do a show like that bless them. That's wonderful.
Ricky Mulvey: How about a trend? How about something you're more comfortable being asked? Any other big trends as we're starting to wrap up the show today?
Dylan Lewis: Well, you've done a lot of quizzing, so I'm going to ask you a question.
Ricky Mulvey: Let's do it.
Dylan Lewis: What percentage of Americans have ever listened to a podcast?
Ricky Mulvey: 35%.
Dylan Lewis: Mary?
Mary Long: Way higher. 55.
Dylan Lewis: Sixty-seven percent.
Ricky Mulvey: That's pretty good.
Dylan Lewis: According to Edison research and a session that I attended before you guys showed up. [laughs].
Ricky Mulvey: Which is why I was able to surprise you with that data point. I think is interesting about that is it's clearly higher than what we thought. That's not necessarily habit listening. That's ever listened. There is still growth. There's still ceiling for this industry to rise to. But I think a lot of the reason that we look for things like video coming in is we need to get outside of the core podcast distribution audience, because there's actually a decent amount of saturation's already happening. I think that's fair. Also a decent place to wrap it or a good place to wrap it. That was a really good data point, Dylan. You did beat me on the quiz. I was off by a factor of two, and I work in this thing. Mary Long, Dylan Lewis. Thanks for joining me in person live. At the residence in Marriott across the street from Podcast movement. This was a lot of fun.
Dylan Lewis: Absolute pleasure.
Mary Long: Happy to be here.
Ricky Mulvey: As a heads up since all of us are gonna be at the convention for the rest of day and tomorrow. We will not have an episode on Wednesday. We will be back on Thursday. Thanks for listening. As always, people on the program may have interests in the stocks they talk about, and the Motley Fool may have formal recommendations for or against St buyer sell anything based solely on what you hear. I'm Ricky Moly. Thanks for listening. We'll be back on Thursday.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Dylan Lewis has positions in Spotify Technology and The Trade Desk. Mary Long has no position in any of the stocks mentioned. Ricky Mulvey has positions in Spotify Technology and The Trade Desk. The Motley Fool has positions in and recommends Alphabet, Spotify Technology, and The Trade Desk. The Motley Fool recommends Marriott International. The Motley Fool has a disclosure policy.
