November 27, 2022
1 Ask for money
2 Sell other people’s stuff
3 Guests pay to get on the podcast
4 Charge for events
5 Sell your own stuff
6 Your guests are your prospects
100% of podcasters want to make money, but only 5% are successful.
Why have podcasters failed to make money? Most think the advertising model is the only road to success.
Everyone looks at the Joe Rogan podcast and thinks they have a winning lottery ticket to a $50 million payday. Just get in front of a microphone and interview people.
Please remember that Joe Rogan was successful in several incredibly difficult fields before even thinking about podcasting. He was accomplished in martial arts, standup comedy, and television. At each step he was building an audience. After twenty years of growing a community, Joe Rogan launched a ridiculously successful podcast.
Just because you buy a $100 USB microphone and start a free podcast on Anchor don’t think you are the next Joe Rogan.
The Advertising Trap
When it comes to advertising, let’s look at the download numbers from Rob Walch at Libsyn and some projected earnings.
• 3,300 in the first 30 days (better than 90% of the shows) at $25 per M, that means you get $25 x 3300 = $82.50
• 7,600 in the first 30 days (better than 95% of the shows) at $25 per M, that means you get $25 x 7600 = $190
• 20,000 in the first 30 days (better than 98% of the shows) at $25 per M, that means you get $25 x 20,000 = $500
So, if you are better than 98% of all the other podcasts, then you are rewarded with a paltry $500. That is not an adequate reward for the blood sweat and tears it takes an independent podcaster to hit 20K downloads.
$25 per thousand is not directed at mere mortals with an independent podcast, it is directed at large companies who can afford to pay for podcasts with millions of downloads.
You will find that it can be more profitable to have 100 engaged listeners than thousands of casual listeners.
Six Ways to Make Money from Your Podcast
1. ASK FOR MONEY
This is the old NPR model. They normally have seasons where they ask for support. With a podcast, you do it with each episode. One popular tool is Patreon. They take 5% but make it easy to collect money.
One variation on a theme here is to offer free content and then charge, via Patreon, for the bonus content. This is a great way to establish value, then earn the right to ask for money.
Most podcasters don’t realize the value of their previous episodes. If you have a quality podcast, people will binge listen to all the episodes. Another way to use Patreon is to create a nominal financial “gate” to these previous episodes.
2. AFFILIATE INCOME (SELL OTHER PEOPLE’S STUFF)
In the world of digital marketing this is classified as a Cost Per Acquistion (CPA) model. The company only pays you when they acquire a paying customer. Let’s say you offer a link to a Ronco microphone on your site. When a reader hits the link, and buys, then you are rewarded with a nominal commission.
Seriously, how much can you make with a 5% commission on a $100 microphone?
Please don’t dismiss this model. If you have a large community and have built up trust, you can take advantage of much better CPA offerings. For example, Amy Porterfield has paid 50% for anyone signing up for her $4000 course. It is a much harder sale, but you finally can be able to make a reasonable return on your efforts.
3. GUESTS PAY TO BE ON THE PODCAST
At first blush, this seems counterintuitive. This is because of the pervasive nature of the advertising model. If you were to ask somebody at the grocery store how a podcast works, chances are they would say guest appear for free.
Well, the man with the initials, JLD doesn’t think so. John Lee Dumas has a podcast where he charges $2500 to appear on his Entrepreneurs on Fire podcast. That means that companies have perceived at least a $2500 value from the appearance.
If you have a targeted audience, you can charge for an appearance. It all comes down to value. If a company is trying to break into a market, they want to increase reach and brand awareness. If you are positioned as a person of authority in a specific field, you can charge.
One way to rationalize the fee is by demonstrating that you are aggressively promoting the appearance. For example, you can put together a promotion package that targets an audience the company couldn’t. Why not put together a media kit where you talk about your LinkedIn audience, your Twitter followers, demonstrate videos on YouTube and YouTube Shorts, your email list, and the magnificence of your show notes page to showcase the company. It works.
4. EVENTS (SMALL AND BIG)
Eric Siu runs a media company called SingleGrain. He has his own podcast, Leveling Up, as well as a podcast with world famous Neil Patel, Marketing School. They have spun off an invitation-only event where entrepreneurs discuss strategies and tactics. They charge thousands to attend the event.
Even if you are small, you can emulate that model. For example, once you have around 24 guests you can look at guest characteristics. For example, they may all have products that target data centers. One may help with heating and cooling, one may specialize in cabling, while the third company helps with hiring staff.
Why not have a small dinner with five guests who don’t compete? One hour. Each person gets six minutes to talk. They walk away with new contacts.
The key is to find a sponsor that can serve all members of the audience. With the data center example above, there will be a company who provides site maintenance to the data centers. You have the relationship through your podcast. You are the glue to bring them together. Charge for it.
5. PRODUCTS & SERVICES (SELL YOUR STUFF)
This approach can be ridiculously profitable. This can be a coaching engagement, a course, a book, or even a physical product.
Well-known Pat Flynn uses his podcast to sell courses on starting podcasts. Rick Mulready uses his podcast to sell consulting services. The list goes on and on.
One key concept is to have a digital product that can scale. You can establish trust with a podcast. Once that relationship is established, then you can offer a product/service that can help listeners achieve their goals.
6. YOUR GUESTS ARE YOUR PROSPECTS
Adam Adams has a podcast called the “Podcast on Podcasting.” In Episode #280 his guest is Mark Willis. Mark has a podcast with a focus on financial planning. He freely admits that he is not interested in downloads for his podcast. His purpose is to meet prospective investors and begin the relationship with a podcast interview.
If you have a high-ticket offer, then you can kiss your concern with downloads goodbye.
Mix and Match
Don’t assume you can only use one of these models at a time. They are not mutually exclusive. You can use all six for your podcast. Mentioned earlier, Pat Flynn sells courses, but also events, and gets tons of affiliate income.
Compensation models seem to work best at specific stages of a podcast. Let’s look at some reasonable distribution of the big six.
1. BEGINNER 0 – 3,300 DOWLOADS FIRST THIRTY DAYS
By definition, you have no downloads, that will make it impossible to get advertising income
Options: Ask for money & Affiliate income.
2. INTERMEDIATE 3,300 – 15,000 DOWNLOADS FIRST THIRTY DAYS
At 3,300 downloads you may want to consider adding to your marketing matrix
Options: Ask for money, Affiliate income, and Events.
3. ADVANCED – 15,000 + DOWNLOADS FIRST THIRTY DAYS
Finally, you need around 15,000 a month to consider advertising. At this level, many drop asking for money.
Options: Advertising, affiliate income, & events. May be time to consider a digital product if your email list is at least 2,500 email names.
Please remember: every podcast will have different slices of the pie. You may start a mastermind and make enough from that not to worry about the other kinds of income. You may have a digital product and get 100% of your income from leads generated from your podcast.
Conclusion
If you want to monetize your podcast, you must think like a business expert, not like a broadcasting professional.
There is no such thing as an overnight success. Nobody reading this is going to have the success of a Joe Rogan unless they pay their dues for decades.
The advertising model will only work if you are the higher echelons of downloads.
Don’t despair, you have several options. Ask for money, seek affiliate income, ask guests to pay to be on the show, produce events, sell digital products, or use your guest list as a prospect list.
If you enjoyed this article, you may want to read, “What is the Best Bang for your Buck for Advertising Your Podcast?”
John Gilroy
Has been behind a microphone since 1991. He can help you structure, launch, and promote your company podcast. johngilroy@theoakmontgroupllc.com
that was awesome!