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Why narrative podcasts are a bad investment for most publishers
They're prohibitively expensive and very difficult to monetize effectively.
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Why narrative podcasts are a bad investment for most publishers
Back in February 2020, right before the pandemic-induced shutdown, I had dinner with a friend of mine who I knew to be an avid podcast listener. We started discussing the various shows we’d been enjoying, at which point he made a shocking admission: “You know,” he said, “I don’t really listen to any narrative podcasts anymore.” He had eliminated all of them from his media diet and now just consumed conversational shows, the kind where two or more people sit around a mic and record their unfiltered, unedited thoughts for their audience.
At the time, I found that statement incredible. After all, we were entering what everyone considered the “golden age” of the medium. Spotify had just purchased Gimlet Media, which had billed itself as the “HBO of podcasts,” for $230 million. Boutique studios like Pineapple Media were attracting mainstream news coverage, and nearly every major publisher was announcing its own narrative series. And my friend was abandoning all this amazing storytelling in favor of programming that required little more than two mics and a laptop?
But here we are just two years later, and most of the narrative shows are gone from my own podcast feed. The transition occurred gradually. I’d find myself looking forward to new episodes of the conversational podcasts, whereas listening to the scripted ones just felt like homework. My mind would drift during crucial plot points, which meant skipping back several minutes so I could regain my narrative foothold. In many cases, the narrative series I listened to died off after a single season, and I just didn’t have the energy to try out new ones. Today, only four out of the 23 shows I regularly listen to hinge on a storytelling structure.
I don’t think I’m alone in that regard. Last week, Nick Quah published a feature article titled “Podcasting Is Just Radio Now.” It attempts to grapple with why the first season of Serial, published all the way back in 2014, seems to be the only podcast to have entered the monoculture. Here’s Quah:
[Serial] swiftly became a sensation, something you simply had to listen to out of cultural obligation, and it primed you to wonder which show would manage the feat next.
Honestly? It’s hard to say that any has.
It’s been almost eight years since Serial dropped. An entire industry has roared to life, drawing in Hollywood studios, corporations, celebrities, and billions of dollars. But the blockbuster podcast — a subgenre or prestige tier essential to the medium’s rise as an artistic force — is in a serious funk. Your phone is full of podcasts, I’m sure, and maybe you’ve convinced a friend to add one of your darlings to their queue. But when was the last time a single title was being dissected by everyone you know?
I’m not here to argue that nobody listens to narrative podcasts; there’s clearly a market for this kind of ambitious storytelling, and the most popular shows within that category can still attract millions of downloads. But I also think the audience for scripted series is considerably smaller than what most publishers hoped it would be, with many such projects failing to gain much of a foothold.
What’s more, this type of programming is notoriously difficult to monetize. Given this confluence of factors, I just don’t think the investment in narrative audio programming is worth it for most publishers. Let’s dive deeper into my reasons why:
They don’t provide much advertising inventory
When it comes to episode output, narrative podcasts can’t even begin to compete with their conversational counterparts. This American Life probably has one of the largest content budgets in the industry, and yet it only produces a few dozen new episodes per year. Compare that to conversational pods like The Joe Rogan Experience or Fresh Air, which publish literally hundreds of episodes over the same time period.
This means that even hit narrative shows struggle to fully capitalize on their success. If your narrative podcast puts out only 10 episodes per season – which seems to be the standard length for the genre – then that severely limits the advertising inventory that’s available. Meanwhile The New York Times’s hit podcast The Daily produces 250 episodes per year, which comes out to 500 available ad slots.
Audience size is unpredictable
Any industry veteran can tell you that podcast discovery is incredibly difficult, and that’s especially true for narrative shows. Conversational podcasts benefit from consistency, which drives momentum, but narrative shows don’t have that luxury. Instead they have an extremely short runway to build their audience.
Let’s say you’re a premium brand who’s being pitched on sponsoring a new narrative series. You have no idea how popular the show will be — it could end up a complete dud — and you have to commit to the ad buy before the show goes live. Meanwhile, you have hundreds of conversational shows to advertise against, each with very predictable audience numbers and formats. Which route would you choose?
But what if the series has previous seasons that already proved successful? Well, narrative shows can have higher-than-average audience churn, especially when there are long breaks in between seasons and large shifts in subject matter. Just because a listener was interested in the Nixon impeachment featured in Season 1 of Slow Burn doesn’t mean they’ll want to hear about the feud between Tupac Shakur and the Notorious B.I.G depicted in Season 3.
They’re extremely expensive to produce
I’ve heard a lot of claims about what it costs to produce a single season of a narrative podcast. One source puts it at about $250,000, though I’ve certainly heard of shows that cost north of that. Not only does the research and editing take far longer than what’s required with conversational shows, but you also have to pay for things like sound design, music licensing, and marketing.
Let’s say the entire cost for a 10-episode season is $300,000. That means in order to break even you need to generate $30,000 per episode in ad sales. Assuming an average $25 CPM, you would need to generate between 500,000 and 1 million downloads per episode, depending on how many ad slots you run. The number of podcasts that reach that threshold is infinitesimally small, and the odds aren’t in your favor.
Most companies that specialize in narrative podcasts don’t even attempt to recoup their costs directly; instead, their model is dependent on repackaging the IP of a successful series and selling it up the food chain to be adapted into a TV show or film.
They’re also subsidizing their programming with more conversational podcasts. Premium podcast networks ranging from Gimlet to QCode have recently introduced unscripted shows into their slate. While their executives haven’t publicly acknowledged this, I’m guessing that they’ve done so to drive more reliable audience growth and monetization inventory.
The narrative podcast genre isn’t going away, but I think the companies that succeed in it are the ones that have the time and resources to invest in many shows over a period of years. For the vast majority of publishers, on the other hand, the juice simply isn’t worth the squeeze.
What do you think?
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Louie Woodall knows his way around a financial disclosure document. Since graduating college, he’s worked for several media outlets that report on the intricacies of financial risk. In 2020, he decided to combine this expertise with his interest in climate change and launched Climate Risk Review, a Substack newsletter that analyzed climate disclosure documents published by major corporations around the world.
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CNN could use its slumping ratings as an excuse to invest in more digital mediums, but instead it's decided to double down on a format that's losing millions of customers a year. Have fun competing with Fox News for the 80-year-old demographic. [Bloomberg]
Newsletter personalization is tricky because you need an extremely high volume of content to collect enough data to train the algorithms. I doubt the vast majority of publishers would see any success with this. [Digiday]
Substack's reader app will now allow you to add publications that are published outside of Substack. You just simply add their RSS feed. Now it just needs to clone Instapaper's bookmarking functions and it'll be the killer app. [Substack]
"In the same way that Disney’s really learned how to capitalize on the fan hype that builds up around all of its projects, newsrooms have jumped onto Marvel releases as reliable sources of traffic because the eyeballs are just always there" [Nieman Lab] More from the article: "One source who works at a major media company told me that a standard, 1,000-words-or-fewer post-credits breakdown article reliably harnesses between 100,000 to 200,000 pageviews."
YouTubers keep on coming up with more and more innovative ways to monetize their huge audiences. [Tubefilter]
He already had a robust advertising business, but he wanted to foster a deeper connection with his audience.
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