I keep seeing statements like, "Well, I've done this podcast for 2 years and it's time to start monetizing." With this type of mindset, I can see many podcasters getting discouraged or even burned out. I played music in local bars from the age of 16 to 50. 34 years I played music, but I never fell delusional enough to think I would make the big time playing local bars in Northeast Ohio. If I wanted a career I would've had to move to a city like Los Angelas, Nashville, or anything that wasn't Akron, Ohio.
While it's commendable to commit to something for a long period, it's not the longevity that inspires people to share your episodes. It's the content. Nobody has ever said, "Hey Dave you have to listen to this show!" and when I ask why they say, "They've been podcasting since 2014!"
With that said, as I write the updated version to my book More Podcast Money, here are the ways you make money with podcasting.
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The Top Ways to Make Money With Your Podcast
Sell Your Own Products or Services
This is the top way to make money with your podcast. You harness the power of influence.
As you have lived and breathed in your target audience for a while, you should know what they need or want. I was amazed at a WordCamp I attended recently that the documentation for the new Gutenberg is sparse at best. Everyone hates it. Nobody understands it. That is one learning curve that needs to be flattened and if I had time I would dive into it myself.
Why some of your audience will buy from you is due to you bringing value on a consistent basis. This triggers the law of reciprocity. You've done something nice for them, and now your audience feels a need to do something nice for you. If you've shared a little about yourself then they probably like you (if they didn't they wouldn't be listening). If the information you provide is solid then they trust you. When you are known, liked, and trusted the buzz phrase for this is you are an "influencer."
When you launch a product or service you can influence them to purchase your product.
This could be a book, a course, a membership site, a crowdfunding campaign, a live webinar, etc. These products should fill a need in your space, or entertain them.
Sell Other People's Products or Services (affiliate sales)
Affiliate sales are when you sign up with a company to promote its products. You are given a link (or a code) that proves the traffic/customer came from you. If a sale is made, you earn a commission. When you match the right product with the right audience, you can make decent money. I once made hundreds of dollars a month promoting fitness cards on my weight loss show. The commission was $1.50 per deck. This product fit my audience.
I later would do the same when the Fitbit first came on the scene. I bought one and loved it. This is a great place to start. Find a product that you love that your audience ( a weight loss show in this case) would love. I was able to openly and honestly talk about how I loved my Fitbit and ever since I bought it I was more active. Again, I was earning hundreds of dollars per month when the commission was $9 per sale.
Pat Flynn makes a TON of money with Affiliate sales. He created a video tutorial showing how easy it was to install WordPress on a web hosting company. The video was short. It made building a website look super easy, and his affiliate link was right beneath the video.
Find the right product for the right audience and affiliate sales can be a nice source of income.
Crowdfunding / Donations
This form of income requires an extremely engaged audience. When people donate their motivation is one of two things typically
- They want you to continue to create content and have the freedom to keep going. They believe in your message/content
- They want additional information or content.
Adam Curry and John C Dvorak called the donation model "Value for Value" model. Their show the No Agenda Show dissects the media and helps you understand what is really going on in politics and in some cases society and culture. They produce two episodes a week that are roughly two hours long. They have a segment at the beginning thanking people who gave over $250. They have a segment in the middle to thank anyone who donated over $50, and they have a ceremony to "Knight" anyone who has donated over $1000 and welcome them to be a "Knight of the No Agenda Roundtable" and you also get a very nice ring (which of course people can wear, and have other people ask "where did you get that ring).
The No Agenda show is so engaged they are now holding meetups without the hosts. Adam and John provide any tools to their audience that they can use to promote the show.
Jennifer Bryney also does a show about politics called Congressional Dish. She started the show by reading every bill that went through the US Congress. Every American should listen to at least one episode of Congressional dish. Jen thanks all of her supporters at the end of the show.
Both of these shows provide information that you (sadly) can't get any place else. Both are done in an informative and yet entertaining fashion.
The No Agenda Show accepts checks and paypal. They have a jingle that promotes the website to go and donate ( www.divorak.com/na ). Congressional Dish will take your support using whatever payment tool you want
The top reward people offer at Patreon (the top crowdfunding tool ) is additional content.
When is the best time to add a Patreon campaign? When a listener asks you to start one.
Host Read Ads
While currently, less than 10% of podcasts get 5000 downloads per episode (the metric advertisers are looking for, although some need 20,000 per episode) this doesn't mean you can't get a sponsor. I've had sponsors on this show that fit my audience. While some advertisers use an old way of advertising held over from radio where you pay a rate based on the number of downloads ( CPM price per thousands ) this doesn't' work with podcasts who have a smaller - but more engaged - audience. I charge per episode (not CPM). This is sometimes called a "flat rate."
When using the CPM model of (for example) $30 per thousand downloads and your show gets 200 downloads per episode that episode earned $6 (which is why CPM doesn't work for most podcasters). The more niche your audience, and the more niche the product the better the match. The better the match, the higher you can charge.
Dynamic Ad Insertion
While the technology behind dynamic ad insertion is not bad, currently podcasters who are using some services are getting the shaft in my opinion. For me, generic dynamic ad insertion is the equivalent of Podcast Welfare. One system I am checking is paying my .0017 (not a typo) per download. If we go back to that show that has 200 downloads per episode they are making 34 cents per episode.
When you see companies saying "You can make money from DAY ONE" this is what they are using. Yes, you will earn money. However, you might be better checking your couch cushions.
People That Make a Living With Podcast Have a Few Things In Common
I've noticed a few traits with those people who make a living from the income that was generated from podcasting activities.
- They have MULTIPLE income streams. They sell products, affiliate sales, ads, etc. They have a combination of the above. The people that JUST have ads HAVE HUMONGOUS audiences. That take DECADES to build.
- They often have a spouse/partner that has a decent job with health benefits (not all but many)
- Had an audience before they started podcasting (not all, but many).
There are Other Ways To Measure Success
It's not all about downloads and its not all about money. In some cases, you get paid in confidence. You get paid in speaking gigs, or maybe even a permanent job. In some cases, you get paid in friendship, and peace of mind knowing you belong.
Quitting Your Day Job
There are tools online you can use to see how much money you need to have a certain take-home pay. I live in Ohio and using https://us.thesalarycalculator.co.uk/salary.php
I live in Ohio and in Ohio 60,000 will put you in a place where you don't have to worry about your bills. If I want to have a take-home pay of $60,000 a year I need to bring home $75,576.62 (as 20-30% of this is going to taxes). However, if you’re married with children you might be paying for health insurance via COSE (which can be around $1700 a month) which would mean you would need to have $98,192.92 in gross revenue to take home $60,000. Apparently, I'm also never going to retire (as I'm not putting any money away - just a thought).
Now if we break that down that is $1888.33 per week. Assuming you are working 40 hours a week that is $47.21/hour. There are some things to keep in mind. This means your calendar is booked from morning to night if you are doing consulting. This also means you’re never taking a vacation. Wait, you want two weeks of vacation? Then you need to make $101,969.58 in gross revenue (as we will assume you are not making money while you are on vacation. This then means your hourly rate is $49.02/hour and you are working 40 hours a week.
Why You Need Multiple Streams of Income
In a post on their blog, Patreon mentions that only 1-5% of your audience will become Patrons. The average donation is $7. I checked mine, and it was $5, but we will stick with $7.
If I use the gross number from above of that would mean I need to make $8,182.74 a month. If the average Patron donats $7, I will need 1,169 Patrons. If only 5% of my audience becomes Patrons I need a total number of downloads of 23,379 per month so 5% of them will become patrons. While you could say that 23,379 a month is 5845 downloads per week, but that 23,379 should be unique listeners.
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