Advertising expenditure on user-generated content is expected to rocket over the next four years, with podcasting adspend leading the way, forecast to grow at a compound annual rate of 154.4%.
A new report from PQ Media estimates that podcasting adspend will reach $327 million in 2010, up from $3.1 million in 2005, overtaking the blog advertising market.
Recent figures from eMarketer confirm podcastings expected strong performance, forecasting the media to reach between 20 and 80 million US subscribers by 2010 (see Podcasting Could Reach 80 Million US Subscribers By 2010).
In 2005, blog advertising expenditure accounted for 81.4% of total 2005 spend on user-generated online media. However, PQ Media expect this to drop to 39.7% of over all expenditures by 2010.
Really Simple Syndication (RRS) advertising, which was non-existent until mid-2005, generated $650,000 in 2005.
Overall, combined adspend on blog, podcast and RSS advertising is projected to rise by 144.9% over 2006, reaching $49.8 million, up from $20.4 million in 2005.
Commenting on the forecasts, Patrick Quinn, president of PQ Media, said: “Blog, podcast and RSS advertising are being driven by some of the same factors boosting the growth of the overall alternative media sector: continued audience fragmentation, the perceived ineffectiveness of traditional advertising, and the elusive but coveted 18-24 year old demographic.”
Quinn continued: “Blog, podcast and RSS advertising have demonstrated an ability to reach younger demographics as well as influential, and the media tend to be highly engaging. These are attractive trends to brand marketers that are focussed on return investment.”
Total spend on user-generated online media is expected to grow at a compound annual rate of 106.1% from 2005 to 2010, reaching $757 million in 2010.
In contrast, the overall alternative media industry, including markets such as branded entertainment, digital out-of-home advertising, mobile marketing and video-on-demand marketing is predicted to grow at a compound annual rate of 14.8% in the five-year period to $253.7 billion in 2010.
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