Often when you start podcasting the first question you ask – how much money is there for me to grab? The answer is not simple and requires a little more thought than meets the eye. Will you start making money from day one? Will you hit 1,000,000 downloads within a month? Likely NOT. However podcasting can offer a great revenue model if it is thought about and planned with care.
Where Will the Podcast Revenue Come From?
There are three ways in which you can approach money making from your podcast:
- Podcast monetization enabled with your podcast host.
- Acquiring external sponsors via direct deal.
- Selling your own products and services.
Ultimately a lot of the time we think that recording a podcast is all it takes – there are however many more steps and considerations you should have before going with any of the above methods. I always advocate going into podcasting for all the right reasons. Money should not be your number one priority. Why? As you will see below it is not as easy to make the money flow as you may think AND there is a much more valuable aspect of podcasting that you should be exploring – community building. More about this below. Before I will expand on that I will explain more about the three points above.
Podcast Monetization: Via Your Podcast Host.
Most of the main podcast hosting companies now give you an opportunity to turn the ads on. Spreaker, Anchor, Libsyn, PodBean and many more. I have recorded detailed podcast episode about this point. I encourage you to listen to it here.
In a nutshell I am personally not the greatest fun of this option. We have calculated that for 10,000 downloads per month you can expect to get around $20. That’s 10,000 engaged podcast fans – $20 from a room full of 10,000 people would be rather a poor performance. I am sure that pity would bring more than this to your hat! With external monetization options you need to remember that you are working for your podcast host to make them money – it is not a system designed for you to cut a good deal and walk away with a decent wage. PLUS it may actually provide worst user experience for your listeners who may want to choose an ad free experience elsewhere. So proceed with caution here. The money in my opinion is not big enough for you to risk loosing potential listeners.
Podcast Monetization: Acquiring External Sponsors via Direct Deal
This method certainly brings more money to the table and gives you a grater degree of control over where and how to integrate the ads into your content. Here at Music Radio Creative we post produce content for many podcasters and had some discussions with our clients on what works and what doesn’t. Cutting a sponsor deal directly with a sponsor requires the following:
- Consistency of content production – you need to be able to show potential sponsor that you are reliable, have a solid track record and they can expect that you deliver what you promise.
- Quality of content – you can’t pull wool over anybody’s eyes here. You need to know your niche and provide quality content for any sponsor to take you seriously. This method certainly does not have a place for podcasters who aimlessly release a content without a thought and consideration.
- Perseverance – this is not something that will happen overnight. We have worked with podcasters who had to get to episode number 200 before any corporate sponsors would take them seriously enough.
- You need to know your numbers – when you approach potential sponsors with a sponsorship proposition have all the numbers handy for them. Average number of downloads per episode, if you have run any previous campaigns send examples of execution and conversions if you have them in hand. It is often worth to get the first sponsor at a minimum rate so that you have an example to share with any new sponsors you approach.
How much can you expect to get?
This hugely depends on your industry and size of the audience as well as the budget of your sponsor. To give you an example of our YouTube sponsored content. We charge approx $1000 for a series of 3 dedicated videos. With podcasting you can consider the following ways in which to charge:
- Dedicated content – interview with sponsor, detailed review of their service/product, use case scenario, how you use them and why you recommend them. Dedicated content should be charged at a premium. Think of how much time it will take you to create it and put hourly charge to your time. Then double it as it is always worth to ask for more than you are comfortable with 🙂 you can always go down – never up!
- Month/quarter/half-year sponsorship – ad pre-roll, mid-roll and end-roll ads to your podcast (or any combination of those). You can read them, sponsor can provide produced ad and you insert it into the normal content. Best to look at overall number of downloads you get per episode and calculate potential reach your sponsor would get. Remember to remind your sponsor that podcasting targets specific niches so all of the audience you are exposing them to is uber relevant! Unlike with radio where you advertise to whole population with podcasting you are already doing the most important marketing job – segmenting the audience into relevant categories. I may be entirely off here but I did see rates of around $100/10,000 downloads/month (can you see how irrelevant that $20 is now!?)
- Combination of the above. It’s nice to be flexible and work with a sponsor to get them the type of exposure that aligns with their values. So work on combining the bespoke content with regular ads. If you have a mailing list you can add that to the list too (for extra charge), blog post etc – just make sure to accumulate the reach as you go along.
Podcast Monetization: Selling Your Own Products and Services
By far my favourite and most relevant podcast monetization method. Why? Because it leaves you in control 100% of the time! If you have decided to start a podcast – hopefully it is because you have something valid to say and cater to a group of people interested in the topic. So instead of putting the energy to find an external sponsor – put all of that energy in developing your own products and services. Your podcast should be a vibrant community of people interested in the topic you cover. Because they know and trust you already – they will be much more likely to buy your product from you than some external product you offer. Ideas for products and services you can sell on your podcast include:
- Coaching services
- Paid consultations
- Mastermind groups
- eBooks (or printed books too)
- Online courses
Word of Caution
In everything you do – always keep your podcast listener in mind first. Their best interest at heart should be always your number one priority. If you follow that rule – you will be just fine with any method of monetization you choose for your podcast. Good luck and please share your experiences in the comments below.