Podcasting Tips

The Podcaster’s Guide to Advertising


Like any other form of media today, there are two main approaches to podcast monetization: a consumer-supported approach or an ad-supported approach. Better yet, you can combine the two strategies and leave the choice to your listeners. Hulu is a great example of this—you have the option of paying to watch their content ad free, or you can watch the ads and enjoy the content for free. 

Podcast ads are here to stay

As podcasting has evolved and become mainstream, donation and subscription models have proven to be effective ways to monetize. But one thing is certain: the ad-supported approach isn’t going anywhere. Advertising is the most popular way to monetize podcasts for a few reasons….

Advertising is typically the most lucrative monetization method for large podcasters and represents the largest chunk of many of these creator’s revenue. Ads also keeps your podcast free for listeners and provides everyone access to your content. Making your podcast widely accessible is key to retaining and growing your audience.

Advertisers want in on podcasting 

There’s also more money than ever before being poured into podcasting advertising. Which is great news for podcasters. In the past five years, advertisers have come to realize just how relevant and effective podcast advertising is. NPR’s podcast revenues will overtake broadcasting for the first time next year and according to IAB, podcast advertising revenue overall is expected to exceed $1 billion by 2021. 

It’s clear why podcasting has become such an attractive channel for advertisers. One third of Americans, about 90 million people have listened to a podcast in the past month (Edison Research) and 75% of podcast listeners not only pay attention to podcast ads (adweek), they also follow the calls to actions. 

The ins & outs of podcast advertising

All that said, advertising is more complicated than other monetization methods. You first need to find an advertiser that’s a good fit (or they may find you), then agree on the length and terms of the campaign, and once the deal is in place, you’ve got to read an ad that performs well so you can rinse and repeat. If you are just getting started advertising, it can be challenging to know where to start. 

What are the different types of ads? 

The majority of podcast ads are Programmatic ads or Direct Response ads. There are a few major differences between the two. 

Programmatic ads are similar to traditional radio ads. They’re pre-recorded ads that are supplied by an agency or network in bulk to automatically fill designated open ad inventory on your show.

This offers a low-effort way to make some ad revenue or sell unused inventory, though the CPM rate is modest in comparison to direct response ads. The main drawback is that you lose the creative control over what ads are running on your show, although there is a lot of new technology that’s improving the targeting of automated ads.

Direct Response ads that are host read are the most common type of podcast ad (IAB). This type of ad is read by the podcast host and tracked by the advertiser using a call to action, which is a unique code or vanity URL that gives some sort of exclusive offer to listeners.

Advertisers prefer host-read ad spots because they outperform programmatic ads. The fact that the ad is read directly to a highly engaged audience by a voice they trust is the reason advertisers have fully bought into podcast advertising. It’s powerful. It’s also the least disruptive and most organic way to advertise on your podcast. Which means your listeners prefer host-read ads, especially when you have fun with it and make the ad feel a part of your show. 

How are ads inserted? 

There are two ways to get ads inserted into your episode:

Baked in ads are a part of your actual podcast and are either read live by the host or directly edited into the episode. Baked in ads will always live within the content and everyone that downloads that episode will always hear the same ad. 

Dynamically inserted ads are served to the listener at the time the ad is requested, which means that people may hear different ads when they download the episode.

The industry is increasingly moving towards dynamic insertion, but the advertiser may have a preference. Baked-in ads live in your episode forever so when listeners download an old episode, they may come across stale ads that are promoting expired offers. Dynamic ad-serving technology enables you to seamlessly switch out ads into old episodes, which allows you to potentially resell ad spots and keep your catalog fresh for listeners. 

This technology isn’t limited to ads, you can also use it to insert your own timely promotions into your show. For example, you could promote an upcoming live show or remind people to support the show by donating or reviewing the show on iTunes. 

RedCircle’s Dynamic Insertion technology makes it easy to insert any audio clip into your content on demand. When listeners download or stream an episode, RedCircle stitches together a unique version of your episode on the fly.

How do advertisers select shows? 

The advertiser’s goal is to make the biggest impact with the budget they have to spend and what inventory is available to them. While a podcast’s audience size is a factor when advertisers are deciding what shows they want to advertise with, it’s not the only consideration. What’s more important for advertisers is the content and finding shows with audience demographics that align with their current or target customers. 

When looking for shows to advertise on, Brooklinen told NYT that “they tend to make “efficient” plays for smaller, but more committed, audiences. ‘It doesn’t really matter what genre their podcast is in. Whatever they buy, their listeners will buy, for the most part.’”

It’s difficult to get perfect demographic data for podcasts, especially if you are an independent creator. The best way to learn more about your listeners is through audience surveys using tools like Google Forms or SurveyMonkey. Surveys are helpful for both you and potential advertisers to decide what kinds of brands and products will resonate with your listeners.

How do advertisers buy podcast ads & what’s a CPM rate?

Advertisers pay podcasters a CPM rate or the cost per 1,000 listeners. For a direct response ad, the average CPM rate starts around $25 for a 60 second spot. Programmatic ads pay much lower CPM rates and average just a few dollars. Once you’ve ran a few successful campaigns with advertisers, you can start to raise your CPM rate incrementally and gain the leverage to negotiate higher CPM rates with future advertisers. 

How do advertisers measure audience size? 

Advertisers base the size of your audience on the number of unique downloads per episode. This can be challenging for podcasters to calculate because your downloads may fluctuate episode to episode. Plus, you are having to make an assumption about the number of downloads you’ll be receiving in the future. So what’s the best way to accurately calculate your downloads? 

President of Sonic Influence Marketing, Jenni Skaug tells us when SonicIM buys ads on a per episode basis, they “expect podcasts to provide the average number of downloads they’ve received over a 4-week period on episodes that have been live for at least 30 days.”


It’s important to be as accurate as possible when reporting your downloads to advertisers. If your reported downloads fall short, the advertiser may require you to do a redo at no cost. If your downloads are much higher than reported, you will not be paid more for those additional downloads. RedCircle helps you avoid this pitfall by only providing the most accurate data for your podcast.

How do advertisers measure ad performance? 

How well your ad performs determines whether an advertiser opts to renew your show and could potentially affect future opportunities with other advertisers. 

Since direct response ads always end in a call to action, advertisers track how many of your listeners that heard the ad and completed the action, which is typically making a purchase. Advertisers will also often make the assumption that some percentage of new customers come from the podcast ad indirectly. For example, if there’s an increase of new organic users over the same period that a podcast ad campaign ran, advertisers will assume this was an indirect result of the ad. 

→ Want to improve the performance of your podcast ads? Check out our tips from industry experts for recording podcast ads that not only perform well for the advertiser, but also resonates with your listeners.

More ways to monetize

When executed the right way, podcast advertising can be a win all around— for the podcaster, the advertiser, and the listeners. RedCircle helps podcasters that are ready to advertise by getting their show in front of potential advertisers. That doesn’t mean advertising is easy, there’s a lot of time and energy that goes into finding, planning, and executing an ad campaign.

If you aren’t ready to advertise yet, RedCircle offers other great ways to make money podcasting. You can ask your listeners to support your show by making a monthly donation, or set up a paid subscription that paywalls access to exclusive content, whether that’s ad-free listening, bonus episodes, exclusive interviews, or full access to your back catalog.

However you choose to monetize your podcast, RedCircle’s monetization tools and dynamic insertion technology will support your show and revenue goals, whether your podcast is well-established or only just emerging.

Be Heard