Podcasting is obviously trending: almost every day new podcasts appear. This is a great way to enhance your relationship with the existing audience and reach out to new audiences. As you’ll see below, statistics show the continuous growth of podcast popularity.
Whether you run a podcast series or just plan to podcast, the idea of making money from podcasts will strike your brain sooner or later. The truth is, podcasting itself requires investments into audio equipment, specialized software, and even marketing. So, if you know that podcasts can generate revenue, why not use the chance. Some methods listed below will work fine even for new podcasts with not many monthly downloads, while others are more suitable for podcasters with an established larger audience.
Anyway, it is usually not recommended to start podcasting with the single purpose of making money. Anticipating the expected question “Why?”, if you plan to make money and start podcasts, your motivation might be low and result in a lack of passion towards the discussed topic. There will not be many people eager for your pained podcasts. However, when you’ve been podcasting for a while and have built a loyal audience you can develop a monetization strategy based on the following methods and recommendations.
Before we will discuss monetization techniques, let’s see some recent stats related to podcasts. It explains why some companies sponsor and support podcasters.
Actually, podcast listening is on the rise due to new techniques in programming, the global pandemic situation, and, of course, the expansion of “smart speakers”, including various Google Home devices.
According to 2021 podcast statistics from Edison Research:
Semrush analyzed various stats on ad campaigns for podcasts: the most successful campaigns are direct response ads (54% of all podcast revenue) followed by boost brand awareness ads (42% of the podcast revenue).
Today we will focus on several main methods of generating revenue from podcasts. In fact, some of them you might find familiar (affiliate marketing, sponsorship, coaching & consulting services, etc.) as they are applicable and used in monetizing text and video content as well.
Based on the success of some podcasts and industry experts, we can divide podcast monetization into two principal types: direct and indirect.
Direct monetization means payments for podcasts themselves, such as exclusive and premium content, paid older episodes, etc.
Indirect monetization means promotion and sales of other products and services when podcasts are used as a marketing tool.
Let’s consider both types in more detail.
Some podcasters prefer to focus on podcasts only. In other words, they don’t want to spend time searching for affiliate programs or anything else except for their audio content. Some creators just do not want to distract their listeners from the podcast itself and also don’t use any additional ads. They try to make money on podcasts solely. The following list offers several approaches on how to monetize your podcast. In any case, it is always recommended to use several techniques to get the best results.
Creating paid membership for exclusive content is a common method to monetize podcasts. You will still continue providing your audience with high-quality content, but subscribers might get access to special editions or access your shows earlier as a reward for their support. There are several popular membership platforms, such as Patreon, Supercast, Glow.fm, etc.
One of the easiest methods to apply this strategy is to use the well-known Patreon platform.
The platform allows your loyal fans to support your work regularly. Additionally, you can set up a customized system of rewards for your supporters.
Usually, the system of different levels works well as fans’ contribution is rewarded with exclusive content or even merchandise.
It is as simple as it sounds: you need money, so ask for it. Many fans will be glad to support you if you indeed produce great content. If you still feel uncomfortable with the idea, you should know that many famous podcasts exist on donations. Just keep it transparent and open. Tell your audience how you’re going to spend money, be honest and authentic.
Below you can see examples of current campaigns running on the GoFundMe platform.
And here is how a fundraising campaign for a specific project looks:
No doubt, you’ve heard podcasts with the introduction like “This episode is presented to you by (Brand/Company)…” This is a typical and common example of sponsorship.
Actually, it works pretty simple as you don’t need to sell anything. The only challenge here is in finding a sponsor and setting up a deal that suits both parties. Rates depend on how many people are subscribed to your podcasts: the higher the number of listeners, the higher the revenue is.
Unfortunately, beginners might find it a tough task to find a sponsor. Even if there are no interested companies to support your show now, continue working. As your audience expands, you may find nice offers from sponsors. Some podcasters found their first sponsors with only 1 000 downloads per month.
Based on an agreement with an advertiser, the sponsorship can be arranged on a per-episode, monthly, or yearly basis. Some sponsors prefer using their logos or links in your podcast descriptions instead of audio pre-rolls or mid-rolls.
Podcast Dungeons and Daddies has an entire page with samples of ads they used in their episodes:
In some ways, the cooperation with advertising networks resembles sponsorship. It is not always easy to find a sponsor to make a deal with, so intermediaries like ad networks might be useful. Midroll, AdvertiseCast, PodCorn, Authentic and some other advertising networks serve as a link between podcasters and advertisers. The advantage of ad networks is that they do all the work to find advertisers, make deals, and discuss rates.
As a rule, ad networks implement a revenue share model based on CPM (a podcaster is paid for every 1 000 impressions for the ad). It is not as complicated as it might sound. See here. For example, an ad network uses a 70/30 revenue share model. This means that a podcaster receives 70% of the potential revenue, while the network receives its 30%. If a podcast episode has 3 400 listeners, and the 20-sec ad pays $25 CPM. After 3 000 impressions (in our case, 3 000 listens), an advertiser pays 3*$25 or $75 because every 1 000 listens costs $25. Then, from the total of $75, the podcaster takes $52.5 (70% of $75), and the advertising network receives $22.5 (30% of %75). As you see, if you know the average number of listeners and a revenue share offered by a network, you can estimate your potential earnings.
However, there is one downside of this method. Usually, you need to have 5k+ or 10k+ downloads a month (in some cases the minimum requirement can be lower) to attract advertisers with good payouts.
With a loyal audience, you may consider creating and selling exclusive episodes. Yes, you have to create something indeed special that people would like to pay for. Let’s say, you can offer ad-free episodes, interviews with special guests (or compilations from the most interesting episodes), or video live stream.
Note: To save your time, while recording an episode, you can record an extra 10 min to use it later as exclusive content. Just make sure that this part has something really special to pay for.
Here is the example of selling premium content to the Fan Club (podcast Crime Junkie):
Important: Preparing premium content, don’t underestimate the value of free episodes. Your audience is the most valuable asset you have, so you don’t want your listeners to decide that you just use them for pumping out money.
Open a dedicated YouTube channel and upload your podcasts as videos. Actually, it is a simple and fast process to earn some money on your podcasts. You don’t need to create videos specifically for YouTube. You may select an image suitable for the topic discussed in an episode. Moreover, you can break episodes into several short parts to get more video content. Add attractive titles applying some SEO techniques, like using long-tail keywords in titles and descriptions.
Open your YouTube account settings and enable monetization.
The revenue depends on many factors, including the number of views, ad clicks, etc. Let’s say the average is somewhere between $0.50 and $2 per view.
If you create podcasts for a long time and have a collection with a catalog of older episodes, you can use your catalog to earn some money. Instead of offering paid exclusive content, you can restrict and make paid older episodes while keeping recent editions free.
Dan Carlin deploys this strategy just right. Dan offers a fantastic podcast series about history. Actually, his podcasts remind more audiobooks than just podcasts, which is why he has an extensive and very loyal audience. All recent episodes are available for free.
However, Dan has restricted access to older episodes and some episodes with additional (Extra) material offering them for $1.99.
He goes even further and offers compilations of several episodes or all episodes from a specific historical period.
Indirect monetization means the promotion of products and services besides your podcast episodes. Some methods are well-known and successfully used by bloggers, webmasters, YouTubers, and social media influencers. Below you see the list of the most popular ways of indirect monetization.
Your true fans might be eager to purchase merchandise related to your show. You can offer various products, such as stickers, mugs, or T-shirts with a podcast’s name, logo, slogan, or even catchy phrases and images. Fans like to show off their support, so they would buy small items featuring their favorite program.
True Crime Garage runs a branded store with merchandise that varies from sticker packs, caps, mugs, t-shirts to glass-can sets with podcast’s name, funny quotes, logo, etc.
As of now, you don’t need to handle the entire process of printing and shipping products. Platforms like Teespring allow designing and showcasing products that are printed only when people purchase them. Some platforms like Oberlo help you to build a drop-shipping shop. With a drop-shipping store, the ordered product is automatically purchased from another shop (i.e. print-shop). A print-on-demand service allows avoiding significant investments in buying a stock of products and printing as there is a chance that products won’t be purchased.
Actually, you can promote and sell the products you wear or use. But this will not be exactly merchandise. Promotion of products and services not related to the show itself is another method of monetization called “affiliate marketing” (see below).
If you haven’t heard of affiliate marketing yet, you should learn it now. Many businesses in various industries open affiliate programs to promote their products and services. Affiliate marketing involves two parties (in some cases, three – see below): an advertiser and a publisher. An advertiser is a company that needs to sell products, while a publisher is a webmaster (blogger, podcaster) who promotes those products and receives commissions from sales. Commission fees may vary significantly and depend on the type of offer, the volume of generated traffic, and a payout model. In other words, as a publisher, you just refer people (your audience) to other companies.
In some cases, the process involves three parties: an advertiser, a publisher, and an intermediary (an affiliate network). Affiliate networks (ClickBank, ShareASale, etc.) are platforms that unite advertisers and publishers in a single place. A publisher (a potential affiliate) can register with one or more affiliate networks to select a suitable offer (relevant to your niche) to promote. If your podcasts contain some product reviews, you can join the Amazon Affiliate Program so that your listeners will have a chance to find and buy a product at once. The Amazon program doesn’t offer the highest commissions but has one attractive feature: if you promote a $15 book, but your listener who clicked on the link purchases an expensive model of the TV, you receive a commission from the sale of the TV.
Generally, affiliate marketing is a great method to generate revenue. When you’ve built an authority and your listeners tune in to your opinion, you can highlight services and products that might be useful for your audience. Focus on relevant and higher-priced products and affiliate programs with suitable commission rates. The best scenario is when you advertise products you are familiar with and use in real life.
Do not forget to make a disclosure about your affiliate deals.
To build authority and a loyal audience in the chosen niche you should provide your listeners with valuable content. Your time investments will be paid off when you will be able not only to continue podcasts but also to share your expertise and experience in the field.
Whatever you’re specialized in, you can offer coaching and consulting services. Actually, it is a great way to monetize your podcasts. If you have a website or blog, just add a simple form that allows people to apply for a coaching session or consulting. You may use various online tools for consulting sessions, such as Zoom, Messenger, Skype, or any other apps. Besides, for people located nearby, you can arrange in-person consulting sessions.
This method is applicable if you run an educational podcast series. You can collect the material used in your podcasts and add some useful content to create an e-course, e-book, or tutorial. You can sell your course through your website or use third-party resources, such as Udemy or Skillshare.
Third-party platforms represent an easier option as you don’t need to work on the sales system on your own website. Platforms charge some fees from every sale, but the amount is insignificant. When you see that your e-course is popular, you can start sales in-house.
This method works better for podcasters with an established and loyal audience. Before arranging any event or presentation, you should study and analyze your audience well. Having built the authority in your industry, you still have to consider a geographical factor to organize an event that will be attended. Well, maybe 2021 isn’t the best time to host events around the globe due to the ongoing pandemic situation. But when the situation with COVID-19 is settled down, podcasters with a dedicated large audience can consider this method of earning money. As of now, you can consider live streaming as an alternative.
Another example from the podcast Dangeons and Daddies, this time they organize a livestream (tickets cost $5):
There is one more method to be considered. It doesn’t match both direct and indirect categories, so let’s discuss it separately.
In many cases, podcasts are not necessarily making money but they serve as a constituent part of the general money-making strategy. Whatever niche you work in, podcasts can help you reach a new audience enhancing your authority and reputation. Hence, they expand your exposure and increase the number of followers or subscribers, which later can be converted into potential customers.
To evaluate how successful your podcasts are at generating new traffic and revenue, you need to monitor changes in your audience and sales. Podcast hosts usually provide various instruments and tools to track the number of listeners.
Some podcasters recommend Chartable for podcast analytics and tracking. The free version is more than enough to monitor your podcast performance.
You can also evaluate your podcast performance on a sale page — just ask how the customer discovered the product and mention your podcast as one of the options. Some bloggers and webmasters use separate tracking for links published in podcast descriptions and compare the number of clicks with changes in sales.
In any case, using podcasts as a tool for expanding your audience is a good idea.
If you consider podcast monetization you’d better think about available methods and strategies before your first episode is published. The first task is to build your audience; so, you’ll need to create and publish 7-12 episodes till you will see the results. From this stage, you can use some techniques of money-making. Later you can adjust it to match your audience perfectly.
Well, there is no special rule or a specific number of episodes to start monetizing. Some successful podcasters say that 400-500 downloads per episode mark the optimum time to start earning money on your show.
If you like the idea of joining an advertising network, you should be ready that every network sets minimum download requirements. That is why planning is important.
In any case, try various techniques but always keep in mind that your listeners won’t like intrusive advertising.
The first question is whether podcasts make real money or not. Podcasts do make money if they are monetized in the right way. Of course, the higher the authority of a podcaster is, the higher ad revenue possibilities will be. But let numbers speak.
Ross Winn from Podcast Insights mentioned that the average 30-sec CPM rate is around $18 and 60-sec CPM rate is around $25. So you can approximately estimate potential ad revenue.
Now let’s see several examples of successful podcasters and the amounts they earn.
In 2018, The Ringer podcasts were downloaded 420 million times and earned around $15 million in ad revenue (according to The Wall Street Journal). Amy Schumer, an American stand-up comedian, received $1 million to create a podcast show for Spotify.
Ok, those were “big names” we all have heard about. But the situation with less known podcasters is still favorable. Many podcasters earn impressive sums through Patreon. A podcast about the history of New York City, The Bowery Boys earns more than $3 800 per month; The Last Podcast On The Left, which is specialized in true crime and paranormal research, makes more than 57 000 a month, also using the Patreon platform. Ok, guys also sell merch and organize live performances in different cities, so the total revenue is way higher.
We used Graphtreon to find the top creators on the Patreon platform. As you see from the screen below, podcast creators occupied several top lines.
Chapo Trap House, a politics-oriented podcast, is the second top-earning Patreon account. Guys earn over $165k per month and release two episodes weekly, with one free episode targeted at everyone and the other episode released specifically for paid Patreon subscribers. Actually, it’s all about the right balance between free content and paid content. Free content shouldn’t be less valuable or less interesting as it is an instrument to attract new audiences.
Top-earning shows are very different but they have one feature in common – consistency. A well-developed monetization strategy along with consistency and patience usually pays off in the long run. If you don’t see results after a week or month, continue experimenting with methods and techniques. Multiple tests and trials will lead you to the right formula of success.
Now that you’ve read and digested all the ideas and strategies of podcast monetization, you might wonder which one of them is right for you. There is no single path that works for all. In most cases, an optimal monetization strategy includes several methods and depends on your niche, audience’s values, and your personal ethics (well, some people hate any audio ads and they won’t ever include ads into their podcasts).