If people can’t read or watch at the moment, they can listen to a podcast. That’s great for us, but who pays the podcaster? Do podcasts make money?
Podcasts make money through ads, affiliate sales, merchandise, donations, and paid content. Podcast revenue is decentralized, so podcasters manage their own monetization strategies. Ads typically pay between $18-25 USD per thousand downloads.
It’s not just songs, movies, and magazines that play significant parts in today’s entertainment industry anymore. With the advent of the Internet, radio stations and shows became what’s called podcasts.
According to recent statistics , there are over 43 million podcast episodes as of January 2021. Given the high number, it’s almost safe to assume that it’s a booming and profitable industry. However, that doesn’t conclude anything. If you’re interested, let’s take a look at the bigger picture.
How Does Podcast Monetization Work?
While podcast may seem a limited form of entertainment, it still manages to generate revenue. However, unlike videos where you can insert ads, songs where you can charge for royalties, you need to make use of everything to profit from podcasts. What does this mean?
Since a podcast is like a blank canvas, it’s up to you what style, topic, or genre to discuss in your episodes. Similarly, while there are many ways to monetize, deciding what income source to apply or include is up to you. Yes, it’s great that producers aren’t limited or forced to a specific revenue stream; however, this freedom can also become a challenge.
A decentralized or open industry like podcasting means there’s no established or standard rule for monetization. As a result, hosts will have a hard time figuring out the most appropriate, effective, and viable income source. Currently, various ad platforms help podcasts monetize, so it’s best to check them out.
In ad revenue, podcasters can charge brands per 1,000 listeners, and ad rates average the lowest $18 for 15-second ads and $25 for 60-second ads. Using this estimate, suppose an episode reached 5,000 listeners or downloads, $18 x 5 = $90; you’ll earn a minimum of $90 per episode. Moreover, if you put two ads in an episode, you can double that calculation and gain $180 as a minimum.
Are Podcasts Profitable?
Podcasts are profitable. With only a little setup as a computer, headphones, and microphone, you can earn enough money; furthermore, countless platforms host podcasts like Anchor and many others if you worry about distribution.
As discussed above, you can profit significantly just by advertisements alone. Should you want to learn the other ways to monetize a podcast, please read through the end.
Required Listeners And Listening Time
As discussed above, you need to have at least 1,000 listens or downloads per episode to charge for advertisements. Contrarily, affiliate sales pay per purchase, visit, or sign up of sites, goods, or services. Regardless of the number of listeners, so long as people visit your affiliate links, there’s a chance for monetization. However, more listeners mean more link visitors, so it’s best to remember it.
How Do Podcasts Make Money?
If you’re interested in starting a podcast, it’s great to know that there are many ways to generate revenue. After searching information from the web, I discovered the following monetization methods.
Podcasts make money through:
- Affiliate sales
- Paid content
- External distribution like through Youtube or Premium RSS feeds
Like other user-based entertainment, podcasters can also earn from advertisements. While you can’t display banner or pop-up ads on audio, producers became creative through the years.
First, hosts can insert a dedicated ad segment during an episode. Typically, it appears either at the start or the end. However, since it’s usually skipped, some put ads in the middle or throughout the show.
Ad segments come in the form of verbal promotions. It’s either announcing a product or by scripted conversations the likes you hear on radio stations. Currently, you can apply from companies’ ad programs or sign up for dedicated ad platforms. Also, there are times when the brand or company directly reaches out to a podcaster to agree to a promotional deal.
Since producers can insert pretty much anything on their podcasts, the rise of affiliate sales as a revenue stream became more popular. Hosts can segway a product in the conversation as a joke or a recommendation. Usually, listeners don’t mind this method as it only takes a few seconds. If you can deliver it naturally, your audience likely wouldn’t care for it to be regular.
For an affiliate promotion to be successful, podcaster will embed the affiliate links in their show notes. If you’re unfamiliar, show notes are the details or descriptions of your podcasts. By doing so, it’s easier for your audience to view and hopefully purchase what you’re advertising.
Affiliate links can be from the likes of Amazon and other related platforms. Besides, many podcasters also give out promo codes during episodes, which links confirmation and benefits the audience.
Every podcast has a fanbase or avid listeners. What best to provide them than a set of merchandise? That’s right; you can earn from selling merch.
During episodes, you can frequently announce to remind your audience about your merch collection. When you have a social media account for your podcast, you can post it there, so your followers and many others can discover and hopefully turn into buyers.
When you don’t have a shop, you can sell on such platforms as Big Cartel, Bandcamp, and Everpress. Using these services, you can focus on creating items rather than figuring out how to sell them.
Donations are an excellent but unreliable way to fund your podcast. If you’re providing great content and don’t want to splurge your show with ads, you can be transparent and ask your listeners for donations. You can choose from several platforms such as Patreon, Ko-fi, or Buy Me a Coffee if you consider this option.
Aside from that, you can also run a campaign or crowdfunding where you set a milestone and convince potential backers. Kickstarter and Indiegogo are great places to start.
Paid or premium podcasts are also a thing. If you want to produce one, you can upload it to podcast platforms and make money per listens. You can also use the same platforms like Patreon, Ko-fi, Buy Me A Coffee, and Gumroad to sell exclusive or supporter-only episodes while keeping the show entirely free.
YouTube had been one of the popular podcast platforms long before new players in the industry even started. Currently, you can choose to be YouTube exclusive or upload as audio or video simultaneously. This way, you can benefit both from the standard podcast income and YouTube’s excellent monetization schemes.
Who Is The Highest-paid Podcaster?
If you want inspiration, take a look at these figures from the highest-paid podcaster.
The Joe Rogan Experience, an interview and conversation podcast hosted and owned by Joe Rogan, makes approximately $75,000 per episode, $900,000 per month, and $10.8 million annually. In 2020, Spotify signed Joe Rogan a multi-year contract as a Spotify Exclusive Podcaster for a staggering $100 million.
So if you are thinking about starting a podcast. Get started! The monetization options are open for business.