Monetizing a podcast is different from monetizing an ebook or SAAS product. The methods for monetizing podcasts are not as apparent as other internet content. In this chapter, I will go over the methods of monetizing a podcast.
Did you know you can subscribe to the Open Podcast mailing list to get podcasting tips like this directly into the inbox- Click Here to Subscribe Today
Sponsorship is when a company pays a host to promote their company or product on-air. The amount of money a host gets from sponsorships depends on many factors. One factor is when the ad plays during the podcast episode. Another factor is how long the ad runs during the episode. An ad can run three different times. The first time is pre-roll: at the beginning of the podcast. Next is mid-roll: stopping the podcast in the middle to run an ad. The last opportunity is post-roll: run after the podcast ends. The standard for the length of an ad during a podcast is 10, 30, and 60 seconds.
According to AdvertiseCast, the industry average for advertising is as follows:
$15 for a 10-second ad CPM
$18 for a 30-second ad CPM
$25 for a 60-second ad CPM
For a company to consider running ads on a podcast, the podcast needs downloads. The more well-known companies want high download numbers. The monthly downloads numbers companies want can range from 1,000 to 5,000 per episode. By monetizing with ads, a host is selling its entire audience to advertisers. Monetizing using sponsorship will not happen right away. The download numbers need to be high and consistent before companies will advertise.
If a host wants to advertise a specific company's product, they can reach out to employees. The host can find the employees on different social media platforms. Start on professional networking platforms where the people will have their titles listed. Looking for people in the marketing or advertising department. People in that department will decide if running ads on the podcast is the right fit for them. If there is no one from those departments, then get in contact with another department. Someone else might be willing to connect the marketing department with the podcast. The broad approach is to get in touch with support. Many companies have their support on social media. The person running the support could tag a marketing person in the question. If the marketing employee has an interest, they will reply.
Some services will connect podcast hosts with advertisers. The services will take a cut of any money made. The benefit is that the companies using the service want to advertise on a podcast. A host does not need to sell them on the idea. A host is subject to the companies on the service. There might not be a company that fits well with a host's podcast content.
A host can try an open call on their podcast. Someone in their industry might be willing to advertise a product on the podcast. A host has nothing to lose by asking.
Another type of ad to monetize a podcast is the affiliate link. An affiliate link is linking to a product for a commission when someone buys the product with that link. A host can become an affiliate by signing up through an affiliate service. Another option is to use the affiliate program of an e-commerce store. The type of e-commerce store that sells many different products.
For example, I could discuss a specific microphone on my podcast. Then, add a link to the microphone from an e-commerce store in the show notes. I would get a cut of every sale made from the link.
Hosts should be thoughtful when advertising a product or company. A host should ask, "would my audience benefit from using their product?" In the case of Open Podcast, the audience is people that have started podcasting. The companies that would benefit from more podcasts are companies that sell to hosts.
These companies are microphone companies, podcast hosting companies, or audio recording software companies.
By using affiliate links, a host can start to monetize their podcast as soon as possible. A host may only be monetizing a fraction of their audience with affiliate links.
Sell Products or Services
Selling products allows a host to remain independent. While providing extra value to their audience. The products a host can sell to their audience are products such as an ebook, services, or a course.
Selling products gives the audience a choice to pay, which may lead to low conversion rates. A host should ask their audience what products they would be willing to buy. By asking a host does not invest time in a product nobody wants.
For the Building an Indie Business listeners, I could sell services surrounding podcast creation. Listeners might want consulting services or an ebook about podcasting. Anyone needing help and that is willing to pay would have the option of getting my support.
Selling products or services is not an overnight monetization method. A host needs to build trust with the listeners. Build trust for listeners to find that products or services will provide value. In most cases, the host has to take the time to create the product they will sell to listeners. A host sets the price for products or services. By setting the price, hosts can decide their own profit margin. For affiliate links and sponsorships there are fixed rates.
To sell the product, a host can sell a product on their own. There are DIY e-commerce services that a host can list their product on. The services will handle payments and send the host a check every month. A host can add the product to e-commerce platforms. The platforms will take more money, but more people might buy the product. A host can accept donations for the product. Once a donation gets made, they send the product to a donor.
There is a second impact of selling products and services other than money. A host can grow their audience from the people that buy their product. People who do not listen to the podcast that buy the product might start to listen if they are aware of the podcast. A host can mention the podcast on the cover, use examples from the podcast, or put a link to the podcast in the product.
The final monetization method is to have the listeners pay. There are two routes a host can take in the listeners' pay model, donations and private podcast.
For donations, hosts need to set up an account to accept donations from listeners. The donations would be optional for the listeners. If a host wants to make money from their podcast, they should set up donations before the first episode. Some podcast players will add a button for donations that opens up to the podcast's account.
For a private podcast, a host would need to set up an account to accept donations. The donations platform will give donors access to the RSS feed.
In the listeners' pay model, a host may need to provide extra content to the listeners. For the listeners to get additional value for their money. A host could have a Q&A with donors or give additional details about the episode. Some donors might want a behind the scenes look into the making of the podcast.
The listeners' pay model is similar to selling products. Being that the host has to build trust and provide value to the audience before giving their money to the host.
For Building an Indie Business listeners, the type of extra content I could create is videos. Videos that would help donors create their podcasts. Showing viewers how to use recording software or upload audio to specific podcast hosts.
Comedians monetize their podcasts with two methods. The first method is by listing their tour dates on the podcast. Announcing their tour dates on the podcast sells more tickets. Listeners will buy tickets if they know the comedian is touring in their city. The comedians are selling an experience. Some comedians monetize through ads too.
A host does not have to stick with one method for monetizing a podcast. A host can use more than one method. But the host has to manage each method of monetization. They have to manage the relationships that each method creates.
This post is an excerpt from the Open Podcast Community book. The book is available for purchase here.