The average podcast conversion rate for site visitors decreased in Q1 2023, having dropped from 1.32% in the previous quarter to 1.21%, but has remained up year-on-year, according to the latest Podsights Benchmark Report for Q2 2023.
Average podcast conversion rates dropped likely due to economic uncertainty, as a previous report from Insider Intelligence projected podcast advertising growth dropped from 55% to 27% in 2023. Previous reports from Podsights already started to show signs of conversion rates slowing, as the numbers remained stagnant at 1.3% in both Q3 and Q4 2022 last year.
However, the report from Podsights still says that “2023 podcast media performance is starting the year out strong” when comparing the numbers to Q1 2022, where conversion rates dropped by 23% and that, overall, the average conversion rate has increased year-on-year by 9%.
“Although that is slightly lower than the previous report, historical trends consistently show growth in performance quarter after quarter starting in Q1,” said the report. “Now is a great time to take advantage of the expected uptick.”
In addition to an increase in the average conversion rate, podcasting ad spend also saw a significant increase in Q1 2023, having gone up by $33m (£26.5m) since the last quarter of 2022 with a total of $790m (£633.3m).
The latest Digital Ad Spend report from the IAB also proved that 2023 could be a positive year for podcast investment, as it was one of the most resilient categories last year, up by 32% year-on-year in 2022 and beating the overall UK digital ad industry’s growth of 11%.
“[Podcasts are] a fast-growing medium, it doesn’t scream to us that advertisers are holding back investment or that there’s concerns at all,” said IAB UK chief marketing officer James Chandler to PodPod. “On a very logical level, it must be delivering for them as they continue to invest in it and as the opportunities to do different things become more varied and more complex.”
Data from the Podsights report is collected from Podsights’ ad campaigns, which have been running from Q2 2022 to Q1 2023 and includes up to 4,500 podcast campaigns and 1,000 brands. It takes into account the campaign size, frequency and conversion rates to analyse the data, while the average conversion rate is calculated based on the number of impressions and estimated frequency of visitors.
Other highlights from the report show an upward trend in the use of mobile apps for podcast listening and its effectiveness in driving app downloads. The conversion rate for mobile app installations rose by 44% in Q1 2023 from the last quarter, now at an average rate of 0.23%.
According to the report, Q1 2023 also experienced the “strongest” average conversion rate since it experienced a drop by 0.65% from Q1 to Q2 2022. Now, the average conversion rate has grown from 5.15% at the end of last year to 5.35%, which represents the number of attributed visitors who enter a website as a result of a podcast ad.