Podcasters know it takes a lot of time to research, write, and produce their shows. At Mello Studio, we look forward to our favorite releases as podcasting is a part of us. In many cases, podcasters have to ask is it worth it, outside of the pure love of the content? Those interested in pursuing a career in this field, usually have several questions including does hosting a podcast make financial sense? Can podcasters make a decent salary? Probably the most asked question would be how do podcasts make money?
In this article, we will take a closer look at how podcasts make money and how some podcasters have taken their shows and turned them into full-time careers?
Sponsorships
To begin with, podcasts are like other fields of entertainment they are usually free content supported by ads and sponsors. Sponsors are like companies that feature their ads on the walls of stadiums or arenas and many of these companies also sponsor podcasts! The more sponsors you can gather for a podcast, the easier it is to make money from it.
In turn, getting the support of a sponsor, a podcast will give them acknowledgment and announcements in the form of advertisements. If you have listened to a podcast, you have heard an announcer read a sponsor’s ad. What the podcast can bring when others hear the advertisement depends on where the ad is placed, the beginning, middle, or end of a show, how long the ad runs, and how many people heard it.
Let’s break it down. How much podcasters make from sponsorships can be quite complicated. Sponsors pay in “cost per mille” or CPM which comes down to the cost per thousand listeners that download an episode. A sponsor will pay approximately $20 CPM per ad, with successful shows earning much more. Ads that run in the middle of a show are considered more valuable than those that run at the beginning or end as viewers will skip through those ads. If a podcast runs just one 30-second ad per episode during the beginning of a show and pays $20 CPM, you can estimate their earnings per episode:
• 1,000 downloads at $20 per episode
• 5,000 downloads at $100 per episode
• 10,000 downloads at $200 per episode
Expanding the earnings of a podcast can significantly alter when adding extra ads at different times in the episode.
Affiliate Marketing
Affiliate marketing has been a very popular avenue for making money for a long time. Many companies form an agreement with affiliate marketers to get the word out about their products and pay them for their efforts. As an affiliate marketer sells a product, they receive a percentage of the proceeds. Companies come from all walks of life such as kitty litter to DNA tests, vitamin supplements to how-to books.
As an example, you host a popular music podcast, Mello Studio lets you join the affiliate marketing partnership. Mello Studio will give you a discount code to add to your show. As listeners use the code on their purchase, Mello will pay a certain amount to the podcast as a commission.
It’s difficult to estimate how much money a podcast can make with affiliate marketing because everything weighs on the marketer’s rate, the number of sales made but generally, 2% of the subscribers on podcasts will use the code each month.
There is no rule of thumb on commissions earned by podcasts but for this article, we will say the commission is 5% of the sale. If each sale is around $35, one sale would earn a $1.75 commission. The estimations are based on total listeners each month:
• 1,000 monthly listeners ≈ 20 commissions/$35 each month
• 5,000 monthly listeners ≈ 100 commissions/$175 each month
• 10,000 monthly listeners ≈ 200 commissions/$350 each month
Therefore, the amount of money a podcaster will make with affiliate marketing depends on their commission rate, how many people use the code, and how much they spend. By increasing the number of partnerships, more money will be gained each month.
Direct Support
Podcasters usually accept direct support from their subscribers. But, direct support can come in many forms so here is a break down of categories:
Crowdfunding & Donations
Consider using donations and crowdfunding to make money with podcasts. Listeners support those who make their favorite shows. GoFundMe and Patreon are two platforms that offer secure and convenient ways to make donations to creators of content. Podcasters offer incentives such as key chains, decals, and pins in exchange for financial support.
Exclusive Content
At Mello Studio, we work closely with advertising and marketing agencies, advertising and telecommunication companies. We offer audio solutions for many forms of media such as videos, TV, radio, film, and documentaries. These people are a vast array of the market.
Podcasters can make money through exclusive content. Direct support encourages people to donate to the podcast for early access to new and exclusive content. Usually, the content is hosted through a website such as Patreon which will automatically unlock the exclusive connect on other streaming platforms.
Monthly Subscribers
Podcasts are free content supported by advertising and listeners. That said, not all shows follow that suit. There are shows on places like Spooked that you can only view through a subscription on places like Luminary or Stitcher Premium. Even though the shows from an ad-free environment, you are forced to pay a monthly fee to see your favorite shows. You might ask how a podcast is different from donating to it monthly on Patreon? The bottom line, if you don’t pay for a subscription, you don’t watch it!
Through Merchandise
Podcasts also sell merchandise to help pay bills similar to events or rock bands. The merchandise is normally sold through the podcast website offering listeners the opportunity to support their favorite show. Even though podcast merchandise can be just about anything, most offer decals, stickers, apparel, and posters. At Mello Studio, we have seen some very different things including face masks, aprons, wine glasses, etc.
For Events
Before the Lockdown, in-person events were very common and podcasters were involved. They could easily connect with people, raise money, increase awareness for the show all in one step. Podcasts can be quite lucrative when you are in physical contact with people vs the digital world.
Festivals & Conferences
Within the world of music, there are many podcast festivals and conferences that fans love to attend. Hosts or podcasters will set up booths and talk shops with fans. Podcast festivals or conferences offer workshops for creating podcasts and have people to discuss everything about the genre or subject. This is an excellent opportunity for podcasters to sell merchandise and raise awareness for their sponsors.
Live Shows
This is a very creative way for podcasters to make money by recording shows both live and in person. The most popular shows go on tours to perform for their fans. When ticket prices, merchandise sales, and other charges are taken into consideration, a live show is a great way for podcasts to make money. Some podcasters have been known to form a local pub meetup where fans can gather, meet each other, and have a great time.
Podcasts Do Make Money
Podcasters tend to be creative and look for many different avenues to make money. When monetizing a podcast, they very rarely rely on just one strategy as a source of income. Podcasters enjoy a range of sources to make money and with a little bit of creative promotion along with persistence, the sky can be the limit.
Mello Studio
We are a state of the art post-production facility and recording studio located in Bahrain.
We utilize the latest technology along with a relaxed, stylish atmosphere which has given Mello Studio the title of First Choice in the industry! What makes us truly unique is the quality of service, delivery time, and talented engineers.
We offer the best audio solutions for corporate videos, video games, TV, radio, film, and documentaries. Telecommunication companies, advertising and marketing agencies, real estate firms, private business entrepreneurs, and animation studios are just some of the professionals we work closely with. We believe that each and every one of our clients have projects that are of the utmost importance so we work twice as hard to reach their target goal.
If you have a project to reach your specific goals, please contact us at info@mellostudio.com. Let us help you set up your corporate video, films, or other media with a 30-minute phone call. Please feel free to email us at info@mellostudio.com for a free consultation. If you have any questions, please let me know, I will get back to you with answers very quickly.
