By FANG Yuanjing, SHE Xiaochen

 

QIAO Qian has a new concern.

She suffers from insomnia, so she started listening to a Chinese podcast and developed the habit of listening to other podcasts. But she soon discovered that it took less than a month to listen to everything available which interested her.

"There are so few Chinese podcasts,” she says.

After comparing with podcasts in English, she was frustrated to find that Chinese podcasts were not only mostly interviews, but also totally different in quantity and quality, which made her very confused.

"Most Chinese podcasts are rubbish,” Er Guai says straightforwardly. Er Guai is one of the producers of Fun Factory Talk Show, a Xiaoguo Culture Media audio series. She believes that the content of Chinese podcasts is still in the rough stage of UGC (user-generated content), and workshop-style production falls short of high-quality content that can be commercialized.

"Podcasts do have a large audience. People’s interest in podcasts springs out of a random show that they enjoy. As soon as they become devoted to the medium, they reach the limits of the limited selection available. It takes less than a month to hear them all, and as a result, the audiences immediately redirect their attention to audiobooks and whatnot, or give up listening to audio shows,” said CHENG Yanliang, host of the Chinese podcast series, “Left-Right.”

Cheng Yanliang and his partner YANG Yi analyzed the statistics of their show over the past 22 months. They compared recent statistics to those from around month ten and month six, from when the show went online, and they concluded that, “the playback to subscriber ratio is stable.”

Yang Yi told Jiemian News that this proves that "Chinese podcasts can attract a stable audience as long as they update regularly and produce decent content."

One the one hand, the current stock of Chinese podcasts is far from meeting the audience's needs. On the other hand, we keep hearing reports that some long-established Chinese podcasts are suspending operations.

Triceratops Radio, Movies are Not Boring, Come Together to Lu’s 2D World and other once-popular podcasts have all gone off the air in recent years, and the podcasters have moved on to other careers. Podcasts that have survived are trying out different genres to stay afloat.

Few investors pay attention to podcasts. A podcast industry practitioner told Jiemian News that this may be because the podcasts are not yet attracting the numbers of subscribers and traffic that interests capital. Instead of Chinese podcasts, advertisers seem to prefer audiobooks which have already generated considerable traffic, or pay-for-knowledge content which is quicker to monetize.

Compared with mature business models like video and animation, why do Chinese podcasts suffer from this problem?  Is it likely to improve?

Podcasting is going corporate

Podcasts are not necessarily a niche market.

In the U.S. market, for example, “The Infinite Dial 2019 Survey” found that about half of their respondents (aged 12 and over) has listened to podcasts. This was the first time that more than half the U.S. population has listened to podcasts. Listeners spend slightly more than seven hours a week on podcasts; with an average user listening to seven programs a week; and an average "loyal listener" spending as much as 12 hours.

By contrast, China, with a population that is many times larger, has 150 million listeners a month listening to audio content, according to PricewaterhouseCoopers' 2018 analysis, but the penetration rate is nowhere near that of the United States. 

Yet, there are signs that Chinese podcasting is on the rise.

Since last year, Yang Yi and Cheng Yanliang have been running a Chinese-language podcast called "Left-Right." The format of the program, like most Chinese podcasts currently on the market, is a talk show. But the topics of "Left-Right" are highly dynamic. Sometimes it talks about the Cold War between the United States and the Soviet Union and spy novels. Sometimes it invites the CEO of a startup company to talk about the sale of second-hand books. It even invited Yi scholars to talk about numerology and Feng Shui.

Most of the topics are what Cheng is interested in. They’re fun but they’re not mainstream.

"I intend to cover topics that we want to know. My version of market common sense is that if you focus solely on what interests the audience, you are bound to be mediocre. Audiences don’t always have good taste, they may treasure mediocracy as miracles. This happens all the time,” Cheng said.

Soon after its launch, “Left-Right” hit the top five completion rates on audio platform, Himalaya. For 50-minute episodes consisting of casual talk and chit-chat, this was very difficult to achieve.

In July, XU Tao, a former content director for 36Kr, a Chinese information service provider for tech companies, returned home from Silicon Valley to start “ShengFM” and specialize in podcasting. She was in charge of content production for 36Kr's generic business technology show “Early Bird from Silicon Valley”, which is now in its third season. On top of that, she has a podcast called "ETW" which has been running for years and is more self-centered and "casual."

Cheng Yanliang and Xu Tao are both rare producers of premium content on the circuit.  "Left-Right" was named Apple's best new podcast of 2018, while "ETW" and "Silicon Valley" were also selected as Apple's best podcast of 2018.

But most podcasters are doing it as a side job, and if it becomes a full-time job or incorporated, monetization becomes an inevitable consideration. The conflict between scaling and quality is prevalent in the field of content-production, in one form or another.

“If you are only doing it as a business, you produce no commercial success, nor premium content,” Er Guai said, "China has yet to prepare the ground for podcasting. It’s hard to assemble a good team and unrealistic to outsource. These are very practical problems, and only full-time professionals can take on such challenges."

Audio content is already an emerging market with 425 million users nationwide in 2018, according to research published by iResearch. As a comparison, video content has about 725 million users.

At present, a single episode of "Left-Right" attracts between 40,000 to 50,000 playbacks on Himalaya, and "Early Bird in Silicon Valley" also has several episodes of nearly 200,000 playbacks on the same platform. However, as a comparison, a single episode of "Guo Degang's 21-year Crosstalk Collection" has been played 46.89 million times. On top of listeners' preferences, the platform is also more willing to direct traffic to the latter.

It is almost impossible to count on live-reads to generate viable profit. On Himalaya, a 200-episode series named after an alcohol brand, Shede, was played 1.27 billion times. Himalaya paid the production team 200,000 yuan ($28,000.) This signifies, in a way, that advertisers are not buying into this form of advertising.

Hence, Cheng Yanliang experimented with another approach to monetization: packing their production ability as the product. He presented "Left-Right" as a mature case to sell his programming experience to other businesses, and started JustPod as an extra.

Four months after 'Left-Right' launched, it had its first client: LinkedIn China. Cheng planned, hosted and post-produced LinkedIn's podcast “Turning Point.” Cheng’s other clients include GGV, Withinlink, BMW China, and Publicis.

In the process of working with his clients, he noticed that brands had done their study on audio content. Compared to WeChat public accounts, podcasting is a less populated field. If they acted in time, they stand to draw in stable traffic and increase their brand awareness.

Xu Tao sees the lukewarm market as a rare opportunity to take advantageous positioning in a field. She has planned several programs and secured angel round financing in August.

Right around that time, some brands began getting in touch with Xu Tao. Those which came knocking on the door did not stress traffic and conversion. The audience of Xu Tao’s programs was small in scale but quite vertical. These listeners happen to be exactly who these brands are targeting.

Few podcasters received financing in China. The capital market is still waiting it out.

"If you don't get financing, you have to expand the team's ability to commercialize,” said    Cheng. According to him, JustPod chooses clients that can also drive content production, "so that powerful companies can mobilize their contacts and bring elites from various fields into their programs as guests,” as well as improve the quality of the podcast.

Professional PGC march into the market

Some media organizations have also started to enter this market, leveraging higher budget and more professional production to gain strategic positioning.

In March 2017, Vistopia, a company founded by well-known Hongkong writer and cultural critic, LEUNG Man-tao (LIANG Wendao, if spelled according to Mandarin), launched its first audio program, "Bai Xianyong’s Take of the Dream of Red Chamber.”

Since the Vistopia app went live in 2018, it has presented “Salon Dialogue,” “Vistopia Radio,” the talk show “Eight Minutes” hosted by Liang Wendao, and the recently launched “100 Career Confessions.”

Sun Ruicen, deputy GM of Vistopia, said in an interview with Jiemian News that they will experiment with newer types of audio programing in the future, such as “sound documentary,” to delve into more profound topics.

This form of audio program has become quite sophisticated in the U.S. In 2014, in a “StartUp Podcast,” Alex Bloomberg talked about his own startup experience in a monologue and included details of his communication with family members, arguments with business partners, and battles with investors.

It was a unique podcast innovation. For a long time, listeners' views of podcasts were limited to talk shows, interviews, and round-table discussions, but reality audio programs were refreshing.

“StartUp Podcast” has become one of the most popular podcasts in the U.S., and its production company, Gimlet Media, has became well-known. Gimlet was founded by Bloomberg to provide professional podcasting services.

Besides this new genre, there are also crime investigation podcasts such as “Serial,” and then there is “Corporate podcasts in America.” In 2017, Intercontinental launched its own corporate podcast, “Stories of the Intercontinental Life,” hosted by New Yorker staff writer, Peter Hessler.

In China, the types of podcasts are still limited; mainly because individual podcasters are not capable of producing reality shows, audio dramas, and other programs that require more elaborate structure.

"There are industry standards for who writes the script, who does the voice acting, who does the editing and the music. It's not something that a few people can chat about at home and get done right away. You will need platform support and professional facilities to achieve it,” said Sun. She also thinks this is where PGC’s strength is.

Professional media are better at producing programs. GQ China also launched a new podcast program called “GQ TALK” this year. The first episode of “GQ TALK” was a dialogue between Chinese actress LI Bingbing and Leung Man-tao, on the topic of “becoming middle-aged.” When The Big Band became an Internet variety show hit in the summer, GQ brought two of the bands, New Pants and Jiu Lian Zhen Ren, onto their podcast for interviews.

“GQ TALK” is more like an audio version of GQ’s special reports. But HE Tao, deputy-editor-in-chief of Chinese GQ, has further consideration.

"Audio shows have some unique features compared to video shows. Subjects are often wary or eager to perform on camera, but a recording device makes them more relaxed and willing to share more deeply,” said He Tao who thinks, for content, the voice is irreplaceable.

Compared with other podcasts, professional media is better connected to a large pool of interview resources, excels in professional production, and can update their program regularly.

He Tao is also trying to discover more diversified forms of audio content. He told Jiemian that instead of recording spontaneous dialogue between the host and guest, he designs the scripts and plots before each episode.

In the latest episode of “GQ TALK,” they asked comedian, Jin Jing, to describe her reactions to the invite and her views of the journalists’ questions before they cut to the dialogue to show the contrast. “You always need to discuss the plan before-hand with the podcast guest. But professional media are good at designing the plot and pacing the story,” said He Tao.

In the future, He Tao plans to make the podcast interviews longer and to try something similar to the documentary of sounds by Vistopia.  By recording multiple interviews at different times and instances and edited materials that span a longer time, he hopes to deliver content which is more intense and insightful.

PGC also puts emphasis on the team’s ability to attract celebrities to their show, which is their strong suit.

Er Guai thinks that having a superstar is the best way to elevate a program’s influence. "No matter how strong the program’s desire of expression is, how good its content is, the public will not listen to a show if it did not have anyone that is well-known,” she said.

Stars may be the first step in PGC's efforts to bring the public back to podcasts. Whether it's Li Bingbing for “GQ Talk” or Leung Man-tao for “Vistopia Radio,” they all use the celebrity effect to attract the audience's attention first. There is still a substantial difference between the podcast content provided by PGC and UGC.

Er Guai believes that although "Left-Right" is currently a relatively high-quality content in UGC, it is produced in workshop style. Furthermore, it performs with a single storytelling approach, and still has no idea about how to do a show. 

Xu Tao also experienced the limitations of a monophonic format. She has planned programs with stronger story lines and scripted content. "Though it is still in demo stage, we’ve already had four or five versions of the script already,” she said.

Commercialization is also not a high priority for these professional institutions.

Er Guai points out that only those who do not consider commercialization a priority can put their hearts and souls into making strong podcast content.

According to He Tao, “GQ Talk” will only consider commercialization in a broader framework across a longer time span. At this stage, it primarily is a sign that GQ China values the audio content industry, and it aims to occupy a strategic position. Both the audience and advertisers of GQ tend to be high-level, so GQ is paying more attention to the penetration and reaction of its brand among elites, instead of trying to gain mass traffic.

At present, Vistopia’s main source of income is still video such as “Round-Table Talk,” which it produced in collaboration with Youku; "CHEN Danqing's Interpretation of Art and Life;" and “Vistopia-Part.” However, Sun Ruicen, deputy GM of Vistopia, believes revenue from audio programs could reach 50 percent next year.

Preparing for an industry to take off

In any case, podcasting is still stuck with the "niche" label.

For audio platforms, the amount of traffic podcasts contribute is still relatively small. In addition to podcasts, audio platforms have audiobooks, live programs, music, crosstalk, and other forms of content. Although platforms such as Himalaya and Qingting FM, two of the most dominant audio apps in China, have emphasized in recent years that they will strengthen their strategic support of podcasts, their support is still auxiliary at best.

Vistopia launched its own app this year, and selected some audio programs and platforms for exclusive broadcasting.

"You can see the support of the platform, but more platforms are doing it from a traffic point of view than from a content point of view. It does not amount to any change in their operation direction. So there are some real difficulties when it comes to collaboration. There are some good podcasts, some platforms that do direct traffic and other support their way, but they're not quite there yet," said Sun.

Himalaya’s operations director told Jiemian that currently the revenue of the platform and anchors is based on the micro-task system. The system automatically pairs advertisers with anchors that are mini or micro influencer and a list of PPC cost is shown. "At present, the most common cooperation is Yi Tiao, where anchors can get 80 yuan when a follower clicks through an ad," he said. 

Within this system, the advertising income of podcasters with large followings is higher and advertisers can choose either sponsor an episode or customize a podcast series. This kind of payment method is similar to WeChat's public accounts, and does not deviate from the traditional advertising method of text and video.

But in the United States, methods to monetize podcasting are relatively mature. Take iHeartRadio for example. Based on market research findings, it has launched SmartAudio, a digital data advertising tool to help brands target precise audiences.

In terms of live-reads, the solution in the United States is to set up a special promotional code, which can let advertisers know the sales generated from a certain podcast. But this approach has failed to catch on in China, as the platforms prohibit podcasters from advertising in their shows or on program pages. They have even banned hyperlinks on the programs introduction pages.

As a result, the cooperation between podcasters and platforms are formed by licensing, which has its own limitations for podcaster. It limits a podcast’s profitability when it is licensed exclusively to a platform. And when you license to multiple platforms, your followers are scattered across platforms, and it becomes unlikely that an advertiser is willing to pay for that.

The only thing that gives podcasters hope is that 5G, smart audio devices, and smart driving are set to become more prevalent. More and more advertisers are looking into these scenarios, and podcasts are closely connected with such scenarios.

The head of operations at Himalaya also admits that the biggest advertiser in the audio market at the moment, apart from FMCG and light luxury goods, is the auto industry. "Because the owner is in the car for a long time, there is no way to look at the screen,” He said.

As the smart audio market matures in China, users’ preferences and habits for audio programs will probably follow that of the U.S. market. But how long the ideal environment will last is unknown.

To be sure, revenue from audio programs is growing steadily. Even with traditional radio, Sun says, advertising revenues are growing every year. Again, data from the U.S. market is used by the industry as a reference. Podcasting is one of its fastest-growing advertising media. IAB and PricewaterhouseCoopers predict that ad spending on podcasting in the U.S. will double to $659 million between 2017 and 2020.

Chinese podcasters have some grounds for optimism, but they are also venturing carefully.

"What's more important is to let content-savvy people work on increasing the size of their audience, so more people will listen to podcasts,” Himalayan’s operations director continues, “After all, only with good content can we start to plan for commercialization. China's current podcast quantity and quality are far from this level."