How to monetize podcasts?
Unsure about monetizing your podcast? Afraid you would annoy or lose your following? You aren’t alone. Most podcast creators like you face these challenges. I’m here to help you understand why those thoughts might be incorrect and and to discuss different ways in which you can monetize podcasts without affecting your following.
Why monetize podcasts?
Picture this - Your podcast is doing well. You’ve gained a following that regularly tunes in for your episodes. Brands showed interest in advertising to your audience and you chose to take it up. What do you think it indicates? It shows that your podcast has high perceived value
The Perceived Value Effect
When reputed brands begin to advertize on your show, it builds credibility amongst potential listeners and helps in growing the channel even more. Most people tend to ignore this idea and decide not to have ads on their podcast as it leads to a poor listening experience. However, if you select the right brands, it can have a positive effect on your podcast growth.
Having said that, ads aren’t the only way to monetize a podcast. So let’s look into some of the other areas of opportunity that you might be missing.
Consistent delivery of valuable content is the key to a successful podcast. When you start to make money from podcasts, it sub-consciously helps develop more faith in the product you are putting out and boosts morale to keep you going. This is why it can be a good idea to begin thinking about podcast monetization right from when you have small loyal audience.
Ways to monetize a podcast
Podcast monetization can depend on the way in which content is packaged. For example, podcasts in United States are packaged as entertainment and earn money through ads and sponsorships whereas Chinese podcasts are packaged as educational tools and therefore make money through paid subscriptions.
You should consider 3 levels while thinking about ways to monetize a podcast.
- Level 1: Direct monetization
- Level 2: Brand and content monetization
- Level 3: Knowledge monetization
The podcasting industry is still young and filled with early adopters. Podcast analytics reports suggest that vast majority of podcast listeners stay engaged until the end of the episode. This makes it an attractive opportunity for marketers. Hence, if you have gained a decent following in your niche and you've been able to capture their attention, then direct monetization through advertisements and sponsorships can be kickstarted.
Premium ads are the ones that need to be added to your podcast right when it's released up until either 60 days or until the target downloads that the advertiser paid for is hit.
How to find Podcast Advertisers?There are several podcast advertising networks that help podcasters find the right brands for ads placements. Some of these include:
- Midroll Podcast
- Podcast One
How much money can podcast ads make?Podcasts ads like internet ads have costs per 1000 impressions/downloads(CPM) pricing. Ads tend to range anything between $5 to $70, however, on average, podcast ads have a $30 CPM rate. Let's assume Shopify is paying $30 CPM (cost per 1000 downloads) to advertise on your podcast and you get 10000 downloads and you sold out your ad inventory for it. Let's say your inventory included 2 mid-rolls, 2 pre-rolls and 1 post-roll. Pre-rolls and post-rolls tend to have lower CPM(assume $20) because people might sometimes skip these segments. Your earnings would then be a sum of $1200 ($600 for 2 mid-rolls, $400 for 2 pre-rolls and $200 for 1 post-roll).
If you receive traffic for episodes that are released longer than 60 days ago, then you can consider backlog ads. Evergreen episodes provide value to listeners regardless of when they were released, and are considered as backlog. Advertisers categorise them as backlog ads and pay a lower CPM rate in such cases.
Podcast advertising had become the most effective way for brands to reach consumers. 47% of podcast listeners "strongly agree" that they pay more attention to podcast advertising than broadcast radio advertising. A niche podcast audience can be a gold mine for brands, and you as the podcaster should reach out to brands, who would potentially be interested in targeting your listeners, and offer them a chance to sponsor your podcast. To make it a win-win, you can leverage the brand’s team and expertise in their niche for fresh podcast content. Key difference between Premium Advertisers and Sponsors are that the former pays in terms of CPM (cost per 1000 downloads) whereas the latter can be charged a flat fee. Sponsorships can potentially pay higher and can last long-term, however, materializing such partnerships could take longer.
Endorsements for Affiliate Income
You can help your listeners discover products or services they may like, offer a link to buy the product and earn money in the form of affiliate commissions. A good way to generate higher revenue through endorsements is by building a website where you can post detailed show notes that have affiliate links. You can promote products available on Amazon and other ecommerce platforms, or you could work with brands directly and get a unique link for yourself.
Have a loyal listener base and not keen on promoting ads on your podcast? Patreon might be your best bet. If your podcast was called "xyz", then you could set up patreon.com/xyz and offer tiers of membership for your patrons. Patreon offers podcasters the opportunity to ask their listeners for support. In turn, the podcaster can offer his/her ‘patrons’ access to some additional valuable content. Some creators choose to create unique pieces of content available only to subscribers. The model works particularly well for non-fiction, educational and news podcasts. You could also create tiers for patrons with different levels of access.
Another option of listener support could be in the form of tips, donations, or crowdfunding through kickstarter. When you provide true value, you'd be surprised to see how many listeners are more than happy to come forward and support you and your podcast.
Brand is the secret to making real money for your podcast. The good aspect about Level 2 is that it works even if you have a small audience because you operate in a niche podcast category. Monetary potential primarily depends on the way you package the content under your brand. Some ways to consider are as follows:
Different episodes of your podcast that build on top of each other, compilation of advice from 20 specialists in your niche, behind the scenes research you've done for your podcast, can all be used to make a book and you can leverage your podcast and website traffic to generate sales for the book.
Let's say your podcast is about Mindfulness and you have interviewed multiple hundreds of leaders who have share the best practices. You can compile these into a speech, sign up with an events agency and earn for the gigs.
If you spend time answering a lot of questions, you can set up a paid facebook group where you share lots of valuable learnings and resources for beginners.
Use your brand to launch merch such as hoodies, hats, bags, books etc. and use Amazon or Spotify to generate sales.
For some businesses or personal brands, podcasts can be a channel for sending traffic to your blog or website where you can sell other products or services and generate sales revenue.
Sell Info Products or Courses Educate people and monetize knowledge by selling info products such as ebooks, online courses or offline workshops.
Once you are able to monetize your podcast, you know that your podcast has made it because your content is packaged well enough for brands to place a number on. Making money from podcasts can also boost your morale to stay consistent, which is crucial for a podcast to be successful.
Key to Podcast Monetization
Don’t just stick to one monetization model. Mix it up. Have ads, endorse affiliate products, make books, sign up for events, sell merch. This helps in making sustainable money in the long term.
So, let’s get to it!