- Advertiser spending on podcasts is set to soar past $1 billion in the US this year.
- Podcasters are also increasingly generating revenue directly from their listeners.
- Insider spoke to four podcast experts who shared how podcasts are making money in 2021.
- See more stories on Insider’s business page.
Podcasting and audio streaming have been on a tear this year.
Big tech companies are leaping on the trend. Apple launched a new subscription-based podcast service this week. Facebook is also turning its attention to audio content, soon allowing users to listen to podcasts directly through its app. Elsewhere Clubhouse, which only launched last year, quickly became one of the buzziest apps of 2021.
Advertiser spending on podcasts is set to surpass $1 billion in the US this year, according to research firm eMarketer. And despite the pandemic initially causing some marketers to halt their spending on all sorts of media, podcast ad spend still grew 37% to $959 million in 2020.
Novice podcasters are taking to the medium in droves and while some are earning big by cutting deals directly with brands or through using podcast adtech, others are finding ways to generate revenue directly from their listeners.
Insider spoke to four podcast experts who shared tips on how to make money from podcasting in 2021.
Podcasters should understand their audiences and what they should be charging when approaching advertisers independently
New podcasters should be aware of industry average advertising rates, the experts said.
According to podcast advertising network AdvertiseCast, the industry average rates for podcasts with 10,000 listeners are at an $18 CPM (cost per thousand listens) for a 30-second ad, and $25 for a 60-second ad.
Podcasters should consider carrying out survey to find out more about their listeners and what access to that audience could deliver for an advertiser, according to production company Tenderfoot TV’s co-founder Donald Albright.
From there conversations can take place with advertisers about what kind of ads can be introduced comfortably into the podcast, such as direct-response advertising where the company can easily track engagement with the ad through something like a unique offer code.
The survey could also include questions about whether listeners would prefer the presenter to read out the ad copy themselves, or whether they would rather hear a brand-produced commercial, alongside questions about background and interests.
Distribution platforms offer a simple way for novice podcasters to get set up
Podcast advertising takes on many forms.
Ads can be pre-rolled before the episode, mid-rolls run in the middle of the podcast, and post-rolls play at the end.
Native ads are read by the podcast host and often fit more seamlessly into the conversation. Ads can be recorded separately from the main podcast and “dynamically inserted” into the episode at appropriate breaks. Programmatic podcast advertising is also taking off, where advertisers target their campaigns at certain audiences (rather than specific podcasts), and the ad slots are filled using automated technology.
There are many podcast hosting and distribution platforms that help podcasters manage the brand partnerships side. These platforms can offer podcasts sales, hosting, and distribution while also reaching out to advertisers with the analytics they collect from the podcasts. They can slot in the ads for you, and share a proportion of the revenue generated. Anchor is one platform that is targeted at beginners helping with the uploading and distribution basics and also helping podcasters access advertising.
Agnes Kozera, cofounder of Podcorn, a podcast influencer marketplace, told Insider in December 2020 that its rates fall between $25 and $50 CPM (cost per thousand) plays.
Albright uses Audioboom, which works with podcasters, advertisers, and brands to support sales for podcasts with more than 10,000 listeners per episode.
Another tool is Spreaker Prime that offers monetization tools to podcasts with more than 5,000 listeners per episode. Darren Marlar, a podcaster whose show focuses on paranormal storytelling, told Insider in 2019 that he earned nearly $20,000 in three months while using the platform.
Tapping into local and regional businesses can be one route to ad dollars
While the benchmark for luring national advertisers usually sits at around 75,000 listeners per episode, smaller podcasts can be successful in monetizing if they work with brands aiming for a more targeted audience, said Nick Quah, who has published “Hot Pod,” a newsletter about podcasting, since 2014.
Going local and regional when approaching advertisers is one way smaller podcasts can monetize.
“If you’re a local podcast, and you have a lot of local listenership, then your goal should be to source advertising from your local community because there isn’t a national impact or national presence that your podcast is delivering,” Albright told Insider.
Some podcasters take on more of an influencer marketing approach to their monetization strategies
Brady Sadler, co-founder of Double Elvis Productions, which produces podcasts like “Disgraceland” and “Dead and Gone,” said podcasters should look to create “meaningful experiences” that extend beyond the show itself. Podcast hosts can bundle their social channels and offer advertising packages across the different platforms where they have a presence.
He gave the example of the music memoir podcast “Dear Young Rocker” which worked on a sponsorship with a hair dye brand. The advertiser paid for a slot within the podcast but the campaign also carried over to Instagram. The host dyed her hair on Instagram Live, letting fans ask her questions throughout the broadcast.
“In a way, it acts like influencer marketing,” said Sadler. “I think audio is a natural extension for a lot of influencers too, to build on the connection with their audience, such as [YouTuber] Casey Neistat’s podcast.”
Podcasters can also go down the audience-funded route
Listeners are taking a more active role in the monetization of their favorite podcasts. Podcast subscriptions are a way podcasts can make money while also offering audiences early access and perks.
“Talking Politics,” a podcast that hit 20 million listeners in 2020, saw an increase of around 20% in revenue after monetizing through Acast+’s subscription platform, said Clarissa Pabi, senior content development manager at Acast. Pabi said the figures have been similar for other podcasts using the service, though Acast didn’t provide more specifics.
Creator subscription service
can also be used by podcasters to generate income directly from listeners. Podcast subscribers can access a private RSS feed through Patreon where hosts share early access to episodes and bonus content. Hosts can also interact with listeners through the community and messaging element of the platform.
The total number of podcasters on Patreon, and their earnings, in the UK and US have almost doubled in the past year, Ronny Krieger, general manager for Europe at Patreon told Insider. The company didn’t provide specifics on either total. Podcasts are now the second largest creator category on the platform, Krieger said.
Some of the highest-earning podcasts on Patreon include gaming podcast “The Glass Cannon,” which has 11,219 paying patrons and earns above $80,000 each month, and true crime podcast “RedHanded,” with 9,067 patrons and earnings above $60,000 each month, according to Patreon’s website.
While access to these platforms can bring in more revenue than without, it can cost money to get set up. Apple’s forthcoming podcast subscription platform costs $19.99 to access the subscription model, and Apple will take 30% of revenue from the podcast’s first year, and 15% each year thereafter.
Podcasters can extend the monetization possibilities of their shows through events and merchandise
Podcasters can also find monetization success by launching products and working on events outside of their core shows, such as with a book or a live podcast recording where listeners can purchase tickets.
Pabi said that “Talking Politics,” for example, launched a collaboration with London Review of Books where listeners could purchase a box of books that fit alongside the podcast episodes.
Influencer merch platform Teespring has a whole section dedicated to podcast apparel, and the process for creators getting set up on the site is straightforward. Content creators need to connect at least one of their social accounts to the website to start designing and selling.
Elsewhere, space and science podcast “StarTalk” sells merchandise through influencer merch company Fanjoy, such as a hoodie for $45 and t-shirts for $25.
Podcasts can request supporter contributions — from the price of a cup of coffee to bigger donations
Podcast hosts can also earn from their listeners directly using a tip-based model.
Acast has its own platform – Acast Supporter – that allows listeners to give anything between $3 and $3,000 to their favorite podcasts.
“Running Commentary,” a podcast by comedians Rob Deering and Paul Tonkinson, has found success with the supporter model.
Deering and Tonkinson told Insider over email that the podcast earned several thousand British pounds through listener donations in the last year.
Donations to the podcast spiked at the introduction of the model, and then again over the Christmas period, the said.
“We’re very clear on the ‘buy us a coffee’ concept,” the podcast hosts told Insider. “The majority of the donations are £3 or £5 ($4-7), and we also get a steady supply of funny, touching, personal messages, and bigger donations.”
Spending your own ad dollars on other podcasts can have benefits down the line
Getting listeners to discover your show is, arguably, the biggest challenge for podcasters. Hitting the landmark 10,000 listener-per-episode mark can be easier said than done in an oversaturated market.
One route to podcast discovery is purchasing ads on other podcasts with similar audiences, Albright said.
One benefit of this strategy is that once the ad appears on a similar show, the host can contact the other podcast’s advertisers and be referred, ideally, to the advertising agency responsible for their marketing budget, according to Albright.