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Westwood One 2019 Audioscape, We Review Two Major Innovations in the Audio Space: Podcasting and Smart Speakers

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Westwood One 2019 Audioscape, We Review Two Major Innovations in the Audio Space: Podcasting and Smart Speakers Audio is a huge part of life for Americans. While AM/FM radio dominates the audio landscape with mass reach and significant time spent, new content and distribution platforms represent audio innovations that are experiencing significant consumer adoption growth. In the Westwood One 2019 Audioscape, we review two major innovations in the audio space: podcasting and smart speakers. In this report, we will examine: • The podcast consumer and listening trends • The smart speaker consumer and user trends • Podcast consumption among smart speaker users • Marketer and agency sentiment for advertising in podcasts and smart speaker environments Research partners Edison Research is the leading authority on consumer use and adoption of new audio technology. For the last 20 years, Edison’s “Infinite Dial” study has tracked usage of streaming, podcasting, and new audio platforms. Each quarter, Edison’s “Share of Ear” study provides the definitive view of American time spent and usage of audio content. The data in this report is based on a Edison’s Q4 2018 “Share of Ear” which represents Q1 2018, Q2 2018, Q3 2018 and Q4 2018. We also use data from Edison’s “Infinite Dial” study. MARU/MATCHBOX is a professional services firm of consultants with a deep heritage in both strategic insights consulting and technology. MARU/Matchbox brings a unique level of expertise in delivering Insight Communities, community management, and advanced research consulting services to its global client base. GfK MRI provides marketers with the most reliable and comprehensive view of the consumer and media marketplaces available. They produce the country's largest and most current database of consumer behavior, media usage, and consumer motivations. The survey is an encyclopedic repository of consumer insights. Advertiser Perceptions is the gold standard of advertiser and media agency sentiment. Advertiser Perceptions conducted a series of studies on podcast advertising consideration and intended use among brands and media agencies during September 2015, July 2016, May 2017 and May 2018. They also conducted a smart speaker survey during January 2018. Podcasts Podcast listening is on the rise % persons 12+ who have listened to a podcast in the last month 32% 1 in 3 26% 24% 21% Americans 14% 15% have listened to a 12% THE COGNITIVE MEDIA PLATFORM 9% An open ecosystem of cognitive tools to harness thepodcast in the last month power of media 2008 2010 2012 2014 2016 2017 2018 2019 Source: Edison Research, Triton Digital, “The Infinite Dial 2019” Podcasting sees steady growth among Gen Z, Millennials, and Gen X % of persons 12-24 listening to podcasts in last month % of persons 25-54 listening to podcasts in last month 100% growth since 2014 129% growth since 2014 40% 39% 32% 30% 31% 27% 27% 23% 24% 20% 19% 17% 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Source: Edison Research, Triton Digital, “The Infinite Dial 2019” Podcast listeners are super fans of audio Daily time spent with audio Podcast listeners spend 43% 5:39 more time with audio daily 3:57 U.S. total Podcast audience Source: Edison Research, “Share of Ear,” Q1-Q4 2018. Persons 13+ Audio includes: AM/FM radio, owned music, music videos on YouTube, SiriusXM, TV music channels, Pandora, other streaming audio, podcasts, Amazon Music, Apple Music Podcast consumers listen to podcasts the most Share of audio time spent among podcast consumers Podcasts 28% AM/FM radio 24% Streaming 15% Owned music 13% If you listen YouTube music videos 11% to podcasts, SiriusXM 5% they are your TV music channels 3% #1 audio source Other 2% Source: Edison Research, “Share of Ear,” Q1-Q4 2018. Persons 13+ Music videos on YouTube and owned music: podcasts listeners are music fans Daily reach among podcast listeners and total audio users Category Podcast listeners Total audio consumers AM/FM radio 69% 74% Music videos on YouTube 40% 24% Podcast Owned music 33% 27% listeners use SiriusXM 21% 16% Spotify 19% 11% 74% Pandora 16% 12% more audio platforms than the Music channels on TV 14% 9% average audio Apple Music 12% 3% consumer Amazon Music 4% 4% Average # of platforms used 3.3 1.9 How to read: Among podcast listeners, 69% also listen to AM/FM radio, 40% listen to music videos on YouTube. Source: Edison Research, “Share of Ear,” Q1-Q4 2018. Persons 13+ Podcasting is growing fastest with Millennial women Female Daily reach among Millennial 18-34 demographics Millennial podcast listeners are Q4 2016 Q4 2018 catching up to male +42% Millennials +118% +55% 20.8 +2% +81% 17.0 17.2 13.9 14.5 14.8 14.6 11.1 7.7 7.8 Women Hispanics African Americans Persons 18-34 Men 18-34 18-34 18-34 18-34 Source: Edison Research, “Share of Ear,” Q4 2016 vs. Q4 2018 Podcast listeners are heavy consumers of spoken word content, especially news and personalities % of who listen to any audio content Total audio consumers Podcast listeners 92% 90% +280% 76% +65% 43% +150% 26% 20% 20% 8% Music News Personalities/talk shows Sports How to read: 43% of podcast consumers listen to news content from any source on a typical day. Source: Edison Research, “Share of Ear,” Q1-Q4 2018. Persons 13+ Among talk and personality listeners, share of time spent with podcasting skyrockets Podcast share of audio time spent with talk/personality content Q4 2016 Q4 2018 +11% 50.5% 45.0% +83% +82% 37.7% +196% 28.9% 26.9% 20.6% 15.9% 9.1% Persons 18+ Persons 18-34 Persons 25-54 Persons 35-64 How to read: Of all the time Americans 18+ spend listening to talk/personality content, podcasting share has grown from 15.9% in Q4 2016 to 28.9% in Q4 2018. Source: Edison Research, “Share of Ear,” Q4 2016 vs. Q4 2018 The podcast audience is significantly younger than other media; but the audience is aging Median age of podcast listeners Podcast median age: 35 33 34 35 35 29 29 29 AM/FM radio median age: 46 ABC/NBC/CBS median age: 56 Q4 Q2 Q4 Q1 Q2 Q3 Q4 2016 2017 2017 2018 2018 2018 2018 Source: Podcast & AM/FM radio: Edison Research, “Share of Ear,” Q1-Q4 2018; Edison Research, “Share of Ear,” Q4 2016 – Q4 2018. TV: GfK MRI Spring 2018, Base: Adults 18+ Podcast listeners are younger, employed, and affluent Total U.S. audio listeners Podcast listeners 69% 63% 55% 55% 50% 52% 52% 35% Younger than Work full-time/ Some college/ $50k+ HH income 35 years old part-time college graduate Source: Edison Research, “Share of Ear,” Q1-Q4 2018 Categories with high purchase propensity among podcast audience Category Index Category Index Category Index Cell/mobile phone "apps" 207 Video games 154 Mp3 players 141 Quick service copy/printing 186 Flowers by phone/internet 149 Cameras/camcorders 140 Headphones 175 Dry cleaning 148 Domestic vacations 140 Camping equipment 174 Fine dining restaurants 146 Barber shop 136 Household furnishings: big ticket Audio equipment & accessories 170 Internet & catalog shopping 144 136 items Sports clothing 169 Luggage 144 Men's clothing: low ticket 134 Contact lenses 163 Baby furniture & equipment 143 Personal computers at home 134 Household furnishings: low Personal computers at home: Video game hardware 162 143 134 ticket items software Foreign vacations 156 Athletic shoes 141 Tablets & E-readers apps 128 Sport/recreation equipment 155 Men's clothing: big ticket 141 Watches 128 How to read: Podcast listeners are 107% more likely than the average population to purchase cell/mobile phone apps. Source: 2018 Spring GfK MRI weighted to Population (000) - Base: A18+. Podcast listeners defined as: Music Or Audio-Related Activities Done On The Internet In The Last 30 Days: Downloaded or listened to podcasts/podcasting Categories with high purchase propensity among podcast audience (continued) Category Index Category Index Category Index Nonprescription sunglasses 127 Fast food & drive-in restaurants 116 Flower shop 109 Shoes 127 Personal appliances 116 Gasoline 109 Total health & beauty aids Home improvements 126 109 Children's shoes 115 expenditures: for women Clothing expenditures 125 Automobiles & other vehicles 112 Women's clothing: big ticket 109 Fine jewelry 123 Women's clothing: low ticket 112 Food stores (personal) 108 Total health & beauty aids 123 Gift cards & prepaid cards 108 expenditures: for men Family restaurants & steak houses 111 Cellular/mobile phones/ 122 Any climate control appliance 110 Home remodeling 108 smartphones Children's clothing 122 Bedding & bath goods 110 Property & garden maintenance 108 Children's toys & games 120 Food stores (household) 110 Table Settings 106 Cologne for men 118 Paint/stain 110 Convenience stores 101 How to read: Podcast listeners are 27% more likely than the average population to purchase nonprescription glasses. Source: 2018 Spring GfK MRI weighted to Population (000) - Base: A18+. Podcast listeners defined as: Music Or Audio-Related Activities Done On The Internet In The Last 30 Days: Downloaded or listened to podcasts/podcasting Most podcast listening occurs at home and throughout the day Where: When: % of time spent listening to % of time spent listening to podcasts by location podcasts by time of day Home 60% 10am-3pm 36% 3pm-7pm 20% Work 20% 6am-10am 20% In the car 11% 7pm-midnight 19% Other 8% Midnight-6am 6% How to read: 60% of all time spent with podcasts occurs at home; 20% at work. 36% of all time spent with podcasts occurs during 10am – 3pm. Source: Edison Research, “Share of Ear,” Q1-Q4 2018. Persons 13+ Percentages may not add up to 100 due to rounding Podcast advertising generates strong results due to extraordinary levels of consumer concentration % reporting high levels of concentration (4 or 5 on
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