There are many reasons to start a podcast: to share a story, share your expertise, share knowledge, share your hobby or passion. Podcasting is an incredible medium that empowers you to share your voice with the world and entertain, inspire, motivate, and educate listeners around the world.
For many creators, podcasting can also turn into a full-time job doing what they love. It’s important to value your creative work and all the time and expense that goes into making a successful podcast. Your podcast is your creative outlet, but you shouldn’t shy away from the opportunity to make money.
Most podcasters want to monetize their show at some point. Which brings us to the question — How do I make money podcasting? Before we get to the different monetization strategies, first make sure you’re ready to start monetizing.
When is the right time to start monetizing my podcast?
If you are new to podcasting, don’t expect to start making money right away. It takes a lot of hard work and some time before you can start monetizing your podcast.
Establishing a trusting relationship and engaging your audience is key to successfully monetizing your podcast. Which is why it’s crucial to prioritize producing quality content and growing your audience.
What’s the best way to grow your audience? We recommend you team up with a complementary podcast and cross promote each other’s shows. Over 75% of listeners discover new podcasts from cross promotion on another podcast. Cross promotion is arguably the most effective ways to grow your podcast audience and with RedCircle’s Cross Promotion Marketplace, it’s easy to execute a campaign (and completely free).
How many downloads do you need to start monetizing? There’s no magic number of downloads, it’s about choosing a monetization strategy that fits your unique audience and goals. Are you trying to cover your costs? Or are you trying to turn your podcast into a full time business?
Strategies to monetize your podcast
As your podcast grows and evolves, you’ll be able to adapt your strategy and increase your earnings. Whether your downloads are in the 100s or 100,000s, there’s a path for you to directly monetize your podcast and start earning revenue.
Ask listeners to support you with donations
Take a page out of the playbook of an institution like NPR and ask your listeners to support your podcast. Accepting donations is great monetization approach if you’ve built a small, but dedicated group of listeners. You can start accepting donations from your listeners from the very beginning without having to produce any extra content, making it the easiest way to get started monetizing your podcast.
Donations are also the simplest way to monetize from an operations standpoint. RedCircle’s Donation feature is a great alternative to Patreon. It only takes a few clicks to set up and then listeners can easily sign up for a monthly donation or give a one-time donation using Apple Pay or Google Pay.
Some creators feel uncomfortable asking their audience for money or worry that it will damage their relationship with fans. Don’t shy away from asking your listeners to support you. As long as you’ve built a foundation of trust, you’ll find that listeners will happily donate a few bucks a month because they value your content and want to hear more.
How much money can you make with donations?
Depending on the size of your audience, donations can generate a nice income each month. To estimate how much you could make with donations, consider the percentage of listeners you think will donate.
Podcasts with niche topics are more likely to have listeners that are very engaged and it’s likely they’ll have a higher percentage of listeners donate. If you have an audience of about 2000 and 10% of those listeners donated $5 you’d generate $1000. If the same listeners subscribed to a monthly donation, you’d have $1000 of recurring revenue each month.
Sell sponsorships and ads
When you think of podcast monetization, sponsorships and ads are probably the first things that come to mind. There’s a lot of ad revenue up for grabs right now. Over the last 5 years brands have realized the effectiveness of podcast advertising. NPR’s podcast ad revenue just overtook broadcasting for the first time ever. And podcast advertising spend is only continuing to grow, by 2021 it’s projected to be over $1 billion.
If you have the audience to support it, advertising is often the most lucrative way to monetize your podcast. Finding sponsorship deals can be challenging when you first start to advertise. Large advertisers often require a big audience, while small-to-medium sized businesses will be more likely to work with you directly.
When searching for advertisers, it’s best to find those that resonate with your content and audience and have marketing budgets that align with your audience size. RedCircle has a broad network of advertisers and agencies that can quickly and easily get you in front of brands to monetize with.
How many downloads do I need to attract advertisers?
Advertisers pay podcasters a CPM rate or cost per 1,000 listeners for direct response ads (that’s when the host reads the ad copy). An average CPM for a 60 second spot is around $25. The more listeners you have, the more ad revenue you can earn. It’s also important to note that your audience may be worth more or less depending who the advertiser is and what they’re willing to spend to acquire a customer.
You don’t need 20,000+ downloads an episode to start advertising on your podcast. We’ve helped shows with a couple thousand downloads find advertisers, but the more of an audience you develop the more consistent you can become securing advertisers. Many podcasters also bring in additional revenue by featuring 2-3 brands each episode, which can add up quickly.
Sell subscriptions to exclusive content
There are now a few podcasters that have turned away from advertising in favor of a subscription-based model. Although we wouldn’t recommend throwing out the ads entirely, offering your listeners the option to subscribe to exclusive content is a great way to engage your most dedicated listeners and generate recurring revenue.
With RedCircle, you can offer your listeners a monthly subscription for access exclusive content. It’s up to you what content goes behind the paywall, whether it’s specific episodes or your entire library. The paid subscription could give listeners early access to content, ad-free listening, bonus episodes, exclusive interviews, or full access to your back catalog.
As with donations, exclusive content doesn’t work without first earning your listeners trust. it’s important you’ve proved the value of your free content before offering any paid options. You don’t need thousands of downloads to monetize with exclusive content. Let’s say you have 500 downloads an episode, but 200 of those listeners are super fans and are willing to subscribe to your show for $10 a month, you’d earn $2,000 dollars a month in recurring revenue.
Distribute your podcast to YouTube
YouTube’s massive audience and built-in search engine make it a great channel to distribute and monetize your podcast. Building a Youtube channel for your podcast allows you to further monetize your content beyond traditional audio distribution channels and gives you a new way to find and engage with listeners.
RedCircle’s YouTube Integration converts your audio file into a video with your show’s cover art and a dynamic soundwave, then automatically distributes it to YouTube. Even if you don’t have a large YouTube presence, more and more users are turning to YouTube to find and listen to podcasts. YouTube may not be the most lucrative channel to begin with, but it can be a great tool to find new listeners. Of course the more listeners and distribution you have, the easier it is to make money from your podcast.
A hybrid approach to podcast monetization
There are many other creative ways to monetize your podcast, both directly and indirectly that you should consider adding to the mix. You could sell merchandise, sell tickets to a live event, sell your own services or products, and the list could go on.
There is no one right way to monetize your podcast. The question is what strategy, or combination of strategies is the best fit for your podcast and audience right now. As your podcast evolves and grows, you’ll be able to experiment with different strategies and find what’s right for you and your audience. RedCircle is here to support you through the journey.