Can YouTube take on Spotify on the podcast front?

Podcasting is on the rise and clearly YouTube wants in on the space. Last year the Google-owned platform hired an individual named Kai Chuk, to the role of director for podcasting and next gen media partnerships after announcing in October that is was looking to hire an executive to oversee its podcasting business. Chuk's background was in business development and strategy, having worked at companies such as Bain & Company, Paramount Pictures and MTV Networks.  

Now, according to an article on Tech Crunch, YouTube has plans to create a future podcasts homepage on YouTube.com with other monetising aspects.

According to news published by Podnews YouTube detailed its podcasts roadmap, and said it plans to centralise podcasts on a new homepage at YouTube.com/podcasts. The document suggests that YouTube will in the future feature audio ads sold by Google and its partners. The document also mentions metrics and the ability to integrate YouTube data into industry-standard podcast measurement platforms.

The addition to podcasts in YouTube wouldn’t at all be surprising as podcasting has become a trend in recent years. Findings from Insider Intelligence indicate that the audio demand has increased in in 2022, the number of monthly US podcast listeners will rise by 6.1% year on year. This is largely driven by younger consumers aged 18-34.

Meanwhile, competitor Spotify has been way ahead of YouTube in this space making heavy investments into the podcasting space with multi-million dollar deals with content creators, tech companies and advertising platforms. It has made its intent on growing its in house capabilities clear.

While the move by YouTube is clearly a copycat one, industry professionals MARKETING-INTERACTIVE spoke to don’t however discount it from being a good one.

Partha Kabi global director for the SK-II account at MediaCom, said Google, the parent company to YouTube, has always stayed ahead of the curve and tried to make it big either by replicating things launched by other platforms or creating something of its own. This can be seen with its launch of YouTube shorts inspired by Insta Reels, YouTube music inspired by Spotify and even YouTube Originals inspired by Netflix. While some have worked well, others are still in the growth stage.

The move into the podcast space, said Kabi, will give a good boost to many content creators who are already creating podcasts and uploading them as videos on the platform. The move won’t just help existing content creators, but also attract new podcasters.

“This will not only help YouTube from an additional revenue stream perspective, but will also allow for diversification of offering to marketers with the ability to add a pre roll or instream audio ads on the podcasts with higher view time and additional reach to the overall platform,” he shared.

Given Alphabet (parent company to Google and YouTube) is a listed company, its hunt for constant growth opportunities is expected. While podcast has been increasing its popularity recently and other players such as Spotify have emerged as prominent players in this field, it’s a logical step for YouTube to get into podcast aggressively - which is similar to its move to launch YouTube Music a few years back, explained Serm Teck Choon, co-founder and CEO of Antsomi.

“With more audio advertising moving away from radio to podcast, Google and YouTube can’t afford to miss out on the opportunity to grab a piece of the cake in terms of audio advertising.

Can YouTube take on Spotify’s giant podcasting wheel?

According to Hari Shankar, chief revenue officer at iVS and former CEO of Singapore Media Exchange said that the incident goes to show :

The 'me-too' malady that has afflicted Google is there to stay.

“I am sure not many recollect Google video - a project that went out with a miserably loud bang because it tried to do a me-too number on the then independent YouTube which was becoming a rising star. Sure enough, when Google saw the project nose-diving, they promptly just gobbled up Youtube for a handsome price,” he said.

Shankar added that whenever an original idea is born out of pure acumen or a trend-spotting, generally that product always has the highest chances of success - if built out robustly. However, when a copycat product is born from the overarching obsession of dominance, majority of the time, the venture is destined to go sideways.

“In my opinion, YouTube can easily get trials of any new products they launch because they have a juggernaut of a platform but in the end, originality will always prevail,” said Shankar. However, a question worth asking is if the original stature and persona of the brand, and how these types of misadventures, tend to taint the image of the brand eventually.

Shanker added that YouTube as a platform is known for its user-generated content as well as original programming. The platform is deeply embedded in the visual world, a world where users have been conditioned to, and revel in, watching video content in order to obtain an informational outcome. Similarly, Spotify users are a different cult, steeped deeply in the audio meme, and expect only that out of the platform.

“I believe that while the original audio products of Spotify will always hold a sway over its users, any original video product of YouTube will always hold a sway over its own users. But either of them try to do a ‘me-too’ number on the other, this 'domination gene' is not going to bade well for the intruder,” said Shankar.

Similarly, Julian Chow, head of digital at Archetype said that YouTube will be playing catch-up because platforms such as Apple Podcasts and Spotify have a much larger podcast library compared to YouTube which will just be starting out, with a ton of genres already in there. He also added YouTube may be attempting to pivot from entertainment to include edutainment in its offerings as well.

"Podcasts are seen more as a learning medium compared to merely videos and music, and by diversifying its value to users, YouTube stands a chance to capture a broader swathe. Whether or not YouTube is successful will be down to whether or not they can convince creators to see them as a credible destination for serious podcast listeners," Chow said. 

At the same time, Chow said a possible reason behind this move could be in response to the rise and prominence of TikTok, which has been chipping away at YouTube's dominance as "the de-facto place for entertainment". YouTube’s move to enter the podcast scene is a typical response to diversify its offering and maintain its value to audiences, he said.

On the flipside, Chow said that YouTube does hold a special advantage over platforms such as Spotify which are audio-only. "YouTube is an audio + visual platform – they could have a winning edge if they can translate that kind of advantage, working with creators to enhance the kind of podcast content being put out on their platform. For example, I can imagine how much richer a podcast could be, if it were enriched with graphics and charts or visuals that further aid the listener in comprehending the podcast’s content," he explained. 

Kabi and Serm held similar opinions that there is a potential of YouTube winning in this space – despite YouTube being a late entrant.

This is because YouTube owns one of the largest bases of audience in the world. If YouTube can aggregate tons of great podcast content, and work on a very great UI/UX to seamlessly integrate the video, music and audio content, it can definitely slice a huge part of the pie for itself.

“I think the simple answer lies in the reach that YouTube has. While Spotify is loved by many for its good repository from a music and podcast perspective, still from the company perspective, its scale is limited given it’s not a platform adopted by everyone in the world. But when it comes to YouTube, the reach is unbeatable,” said Kabi.

Moreover, in many markets around the world, there are already big content creators on YouTube creating podcasts. “This can help YouTube to grow much faster than Spotify in the audio industry. What Spotify did in last ten over years, Google could do that in one year maybe,” he said.

Adding on Serm said, what YouTube might need to be wary of is its reputation in the video space. “YouTube Music is a natural fit for product evolution as many audiences watch music videos on the platform hence they can move on to use YouTube Music. However, the strength sometimes may limit its development in terms of getting into new fields such as podcasts as now you are dealing with different kinds of needs and requirements,” he said.

Lauding the move, Richard Bleasdale CEO of Construct Digital added that while YouTube is playing an Offensive Defensive game, its monthly active users globally (2.3Bn) can dwarf any of the other sub-based players such as Spotify at 0.4Bn.

“It needs to defend its turf from all-comers such as Spotify, and one of the key ways to do this is to develop its service offering, to give current users fewer reasons to go elsewhere for their content,” said Bleasdale.

Unlike Serm however, he saw the move as a natural extension. It will probably help them grow a slightly more affluent demographic – pending of course that demographic being convinced that the YouTube brand can deliver to their needs and wants.

“My gut is they are likely to succeed more initially against a mass, mid-market demographic, which is YouTube’s traditional heavy user base. Over time, I’m sure they will segment more and target different demographics,” said Bleasdale.

Photo courtesy: 123RF

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