Video podcasts having a moment

Amazon’s second-ever Upfronts pitch to advertisers this week featured an appearance by NFL champion brothers Jason and Travis Kelce. They weren’t there to hype live football rights.

While Amazon’s Prime owns the media rights to the NFL’s Thursday Night Football games — and the streamer showcased much of its sports portfolio, including the upcoming NBA season, during the annual media presentations — the Kelce brothers were invited onstage because of the success of their video podcast, “New Heights,” made by Amazon’s Wondery.

Live sports in general have emerged in recent years as the darling of Upfronts. The category was a big part of presentations by Fox Corp., Comcast’s NBCUniversal Disney and Warner Bros. Discovery this week.

Sports content is expected to remain the dominant force in securing advertiser commitments during Upfronts this year, despite growing economic uncertainty.

But viewers’ shift toward social media on both their phones and TV screens has increasingly drawn eyes to the video format of podcasts, and now influencers, TV stars and athletes are inking multi-million dollar deals and garnering millions of followers. The quality of the video production of podcasts has increased, too.

The growing emphasis on podcasts during Upfronts is helping to cement the format as value added in the media landscape. Its this consumer gravitation toward social media, tech and streaming platforms that has led advertisers to spend more on these digital platforms than traditional TV in recent years.

Now, they’re more and more turning their attentions to podcasting.

“We’re constantly looking at all different types of content and content creators. The lines between podcast and talk shows are getting pretty blurry,” said Ted Sarandos, co-CEO of Netflix, during an April earnings call in which he said podcasts could soon join the platform. “We want to work with kind of great creators across all kinds of media that consumers love. Podcasts … have become a lot more video forward.”

The shift in preferred podcast format from listening to viewing signals another opportunity for media companies vying for advertising dollars.

Video podcasts have been soaring in popularity on Google’s YouTube, which is a dominating force in the media landscape and on TV screens.

The consumer preference has been evident with popular podcasts like Alex Cooper’s “Call Her Daddy,” which has almost 1.3 million subscribers on YouTube. The Kelces’ “New Heights” has nearly 2.6 million followers on YouTube. Joe Rogan’s interview last year with then-presidential candidate Donald Trump has 58 million views on YouTube, and counting.

The most-watched TV show on linear last week according to Nielsen data saw 8.2 million viewers. That data measures an audience sitting down to watch a programmed show at one time, versus YouTube audiences which can accumulate over time.

“One of the most relevant formats driving culture — podcasts — is thriving on YouTube,” said YouTube CEO Neal Mohan in a recent post, specifically highlighting Rogan’s interview with Trump. He also cited a report from Edison Podcast Metrics, which named YouTube as the go-to platform for podcasts.

YouTube will hold its presentation to advertisers Wednesday evening.

While podcast companies are able to generate revenue from the sponsorships embedded in the shows, YouTube is typically in charge of the traditional ad spots during breaks. However, Wondery, which is also known for podcasts like “Dr. Death,” was an early “preferred partner” with YouTube, allowing it to sell its own advertising inventory, said Angie More, head of advertising at Wondery.

Amazon acquired Wondery in 2020, putting the podcast maker in Amazon’s advertising ecosystem. Amazon also utilizes video podcasts to create free, ad-supported streaming channels — or in industry jargon, FAST channels. This means Amazon can sell advertising for these channels for the videos outside of YouTube, too.

Having a visual component to the traditional audio content opens up more advertising opportunities, too.

“You can have a more linear TV spot, or you can do full integration with the host, so you can actually have the host talking about the brand and having a visual aspect with product placement,” said More in an interview. “If it’s Coca-Cola, you can actually show them drinking the actual product, or having banners around them, behind them. There’s a lot of different ways to do it, which is nice.”

As the conversation around video podcasts picks up during Upfronts, much of the excitement is driven in particular by sports.

Broadcast station owner Sinclair centered its Upfront presentation earlier in May around its growing podcast content, particularly in sports.

At the event in New York City, executives talked extensively about how brands and sponsors are integrated into the conversation between podcast hosts, such as staging a Nissan Armada onsite or indulging in Wendy’s Frosty treats on air.

Sinclair announced upcoming sports video podcasts after successes with “The Triple Option” and “Throwbacks,” both of which include former NFL players.

Sports-related podcasts, whether discussing the game itself or simply led by former athletes, have been popular among consumers and have led to highly valued partnerships.

The Kelce brothers’ deal with Wondery was reportedly valued at more than $100 million and will run three years.

This year Wondery also announced it had entered into a multi-year deal for the “Mind the Game” series with the NBA superstar LeBron James and former NBA star Steve Nash. This video podcast is one of the first to be made available on Amazon’s Prime platform, along with external sites like YouTube.

“We’re getting to the point where the word podcast means something almost different than it did years ago. It’s really a digital content series, for lack of a better term, and it’s video-first these days,” said Matt Schwimmer, CEO of the Better Collective’s Playmaker HQ. The company makes sports podcasts like “Roommates,” which counts the New York Knicks’ Jalen Brunson and Josh Hart among its co-hosts.

Conversations between media companies and podcast creators are happening more frequently and becoming “more meaningful,” said Schwimmer.

“A lot of them are really starting to kick the tires on syndicating that content from podcast-first companies, and not necessarily making their own,” said Schwimmer, noting discussions with traditional TV networks, the leagues and others.

“I wouldn’t say the budgets are there yet to spend on it, but I think there’s a lot out there and the budgets will come,” he added.

Disclosure: Comcast’s NBCUniversal is the parent company of CNBC.