Although podcasting tools have become affordable for hobbyists to make quality audio at home, many aspiring podcasters still want to know how podcasts can make money. Here are five ways that our producers and our clients have all earned cash from online audio.
1. “Organic,” non-targeted ads.
You’re probably most familiar with “host reads,” a form of advertising that’s worked for traditional radio broadcasting and translates very well to podcasting.
Advertisers love these when they can align their brands to the personality of a popular podcaster, especially when they cross over into testimonial territory. Direct response advertisers especially like podcast ads, since they can measure each placement’s impact on sales. (That’s why you hear so many ads with “coupon codes” that vary between episodes.)
However, these are the most difficult sponsorships to book, and they require podcasters to have scaled an audience in the tens of thousands just to cover the cost of handling the paperwork and traffic management. If your show includes more formal spot breaks, you might slot in some network commercials—with the caveat that too many of these runs the risk of alienating your audience.
Most podcast hosts will support your show if you’re running organic ads within your episodes. Just watch the fine print on hosting agreements with podcast publishers that prohibit “outside monetization” on low-cost plans.
2. Programmatic, targeted ads.
Some podcast hosts now feature technology that “stripes in” externally-supplied ad audio, customized to the individual listener. To your audience, this might sound similar to spot breaks on terrestrial radio. However, two of your listeners might hear wildly different ad messages based on their purchasing and browsing histories.
On one hand, producers and networks tend to like the concept of programatic ads. Targeted ads tend to perform better, yet cost less, since they’re only reaching a pre-selected audience. Anchor’s original business model, before their acquisition by Spotify, traded free podcast hosting for the license to drop programmatic ads into shows. (Spotify seems to be continuing that model, while opening up the potential for member-exclusive feeds down the line.)
On the other hand, many podcast producers have expressed concern about the impact that programmatic ads could have on the podcasting ecosystem. With hard analytics coming into clearer focus, some sponsors may move from organic ads to programmatic and leave high-quality series with lower listener numbers in the lurch.
If you’re trying to move past the hobbyist stage and you’re willing to trade some airtime and some listener data for a small amount of cash support, you might want to check out Anchor.
3. Patronage, using the public radio or Patreon models.
As someone who graduated through the ranks of public broadcasting, I’ve probably helped sell more tote bags and commemorative mugs than I can remember. The public media model is interesting, since you’re selling artifacts rewarding a fan’s support for your show instead of putting your content behind a paywall.
If you’re not yet hitting a thousand downloads per episode, consider using a third-party platform like Patreon to accept monthly micro-donations. You can use a platform like Spreadshirt or CafePress to sell merchandise directly to fans, but you’ll only clear a decent return if you deliver high-quality, limited edition designs at a significant markup. You’re going to have to be okay with charging $40 or more for a shirt that costs you $18 to fulfill. After you’ve built a sizeable audience, you can switch from on-demand fulfillment to a volume-based supplier, but you’ll still need to budget time or money to send orders promptly.
It’s very weird that funding your content stream requires becoming an expert at product design. Yet, this is one of the most consistently successful ways for podcasts to make money, especially for shows whose topics or audience don’t lend themselves well to mass market advertisers.
4. Paywall, using a subscription or audiobook model.
If you’re producing a very high quality podcast, or if you cover business-specific topics on your show, you may be able to convince listeners to follow you into a paid subscription model. This tends to work well for niche business experts, for entertainers with established fan bases, or for complex audio dramas.
I’m not surprised to see a handful of investor-backed companies move into this space, since producers need a heavily polished product to attract subscribers. What I’m somewhat delighted to see is a hybrid model emerging, where podcasters release “free” versions alongside gated “extended” versions of their shows. This is the structire that folks like Marc Maron have used for years, and it’s the business model behind networks like Luminary.
5. Advertising your own products and services.
Content marketing on blogs and across news websites ran into a buzzsaw over the last few years. Small businesses, startups, and solo entrepreneurs could build blogs around their subject matter expertise, attract audiences, and even convert readers into clients. However, aggressive search engine optimization, an exploding advertising market, and a reliance on outrageous clickbait content turned that technique sour.
Podcasts, because of the storytelling nature of the medium and the deeper relationships the medium forces, haven’t experienced the same kind of race to the bottom. While it’s still an uphill climb to build an audience via a podcast, audience retention is much, much higher for podcasts than for blogs.
If you’re an author, speaker, consultant, or professional services provider, podcasts offer an excellent path to showcasing your unique talents while building trust over time. It’s a long game, but if you play it right and act as your own best advertiser, you can build a small but mighty audience that supports the work you’re doing through direct engagement.
You can choose more than one way for your podcast to earn money, but you’ve got to give your chosen plan the best shot for success.
If you’re planning on monetizing your podcast, structure your production to prevent “podfading.” Nothing annoys an advertiser more than an unpredictable publication schedule. And you can’t expect an audience member to buy a t-shirt for a project that might not be around for long.
Our Podcast Taxi audio production service is optimized for producers who want to focus on delivering high-quality, weekly episodes. We can work with you to build a production buffer against unexpected illness, or we can structure a schedule that focuses your valuable time. Talk to us during a free discovery session, and we’ll share our insight into how you can set up your show to pay for itself—and start supporting you financially, as well.