It seems every podcaster wants a big audience and wants sponsorships. But do you really need either of these to be successful? Can you make money with a small audience? Should you really try to get sponsors with a big audience?
From the perspective of what you need to host a podcast, the clear answer to either question is “no.” But let's look at this from a success perspective and what helps your podcast or you reach higher goals.
Challenging the Podcasting Assumptions
This is a special miniseries to challenge the ideas podcasters have accepted as truth for years. Some will stand up against the challenge while others crumble, and some will reveal new options you may have never considered.
- Are you really a “podcaster” and should you really be podcasting?
- Does your podcast NEED interaction or an email list?
- Is iTunes really THE place for podcasts? Do you NEED a mobile app?
- Does SEO really matter in podcasting?
- Do you REALLY need to edit your podcasts? What about authenticity? – TAP178
- Do you REALLY need audio/visual branding or promos for your podcast? – TAP177
- Should you launch your podcast with Episode 0? Does iTunes New and Noteworthy REALLY matter? – TAP176
- Are episode numbers REALLY necessary? – TAP175
- Does audio/video quality ACTUALLY matter? Is a dynamic mic REALLY the best? – TAP174
- Do you REALLY need passion? Is consistency THAT important? – TAP173
Does your podcast audience size really matter?
“How to grow your podcast audience” is a hugely popular topic (and one I have not yet fully covered—hint hint!). Even Leo Laporte, with his few hundred thousand downloads per episode, wants a bigger audience.
This topic was suggested by Ben Avery from Welcome to Level Seven, an official podcast for Marvel's Agents of SHIELD.
What can you do with a bigger audience?
More than just a bigger number in your stats, a larger audience can have many practical benefits.
1. Receive more engagement
With a larger audience comes more feedback with more diversity. You'll still get to see the same people regularly engaging with your content, so you can learn more about them and remember their names.
If the audience is big enough and you receive a lot of feedback, it may be time to start a forum so your audience can interact with each other.
2. Gain more customers
If you are podcasting as part of a business (of any level), then more listeners and viewers mean more people who will begin to trust you, your expertise, and respect the products and services you offer.
It's simple math that if you can convert a certain percentage of your audience into customers, then a bigger audience means more customers. It doesn't have to be this way, but it is one way to increase business.
3. Leverage for bigger actions
The more ambassadors you have for your podcast, the more exponentially it will grow. If each person can only tell two other people about your podcast, and you only have ten listeners, you may get back only 20 more listeners. That sounds like a small number, but the percentage is huge!
With an audience of a 1,000 each telling two more people about your podcast, you could gain up to 2,000 more listeners or viewers!
Consider other “campaigns” that you may run, such as supporting a cause, reaching a celebrity, getting noticed, winning an award, and much more. The bigger an audience you have, the more voices there are to help in each of these cases. (This is how I won the Podcast Award in 2012—it wasn't my audience alone, but the whole Noodle.mx Network community supporting what we do.)
4. Be more informed and accountable for presenting thorough and accurate information
There is a greater collection of information with more people. When you ask three people a question, you get responses based on the knowledge and experience of just those three people. But if you ask 100 or 1,000 people, you'll get far more information and greatly increase the chances of discovering something new.
5. Earn more income
You don't have to have a big audience to make money (even lots of money) from your podcast. With an audience as small as 100 engaged people, you could sell a $5,000 product or course. All it takes to make that $5,000 is to convert just 1% of that audience. Try to get $5,000 in sponsorship or donations for a podcast with “only” 100 fans!
But the math still doesn't lie. Even if you convert only 1% of your audience, a bigger audience means that 1% represents a larger number.
When your audience is big enough, typically above 5,000 downloads per episode, then sponsors would consider you and a CPM campaign may actually be worth your time. CPM pays a certain rate based on how many thousand downloads you receive per episode. So a $10 CPM on 5,000 downloads per episode would pay $50 per episode.
With an audience of 1,000, $10 per episode may not be worth the interruption of hosting a sponsorship in your podcast. A sponsor also may not see 1,000 listeners as worth their investment of time and money. But an audience of 20,000 would pay $200 per episode with a $10 CPM, so that may become worth it to you.
Focus on names, not numbers
Yes, a large audience opens a lot of potential. But you are not a failure with a “small” audience!
Even if your podcast gets only 20 downloads per episode, that is 20 people faithfully returning to hear you! Imagine getting that audience into a room every week (or however frequently you publish).
What's beautiful with a small audience is that you can know each person by name and remember some personal stuff about them. These relationships are invaluable! When your audience grows above 100, it starts to get hard or impossible to know something about every one of your audience members.
Conclusion: Do you need a big audience to be successful?
Everything depends on how you define “success.” I think that influence and recognition are at the core of our desire for a bigger audience. Yes, a bigger audience almost automatically means more influence and recognition. But you can build greater influence and recognition by reaching a small audience in better ways, with better content, or more engagement.
How do you define success for your podcast? How would your perspective change if you set the same goal, but take out growing your audience from the plan?
Should you really monetize your podcast?
As you can see, podcast income is tied very closely to the size of your audience, but also to your basic influence with whatever audience you have.
But should you really be trying to make money from your podcast? You may want your podcast to replace your full-time job, you may want to cover your hobby expenses, or you may not want any money at all.
Is it wrong to profit from your content?
Whether you publish blog posts, audio episodes, or video content, you are making art! Do you think artists deserve to make money for their labor?
This question is deeply rooted in your worldview on economics. I like how the Bible says several times, “The worker is worthy of his wages” (paraphrased, Luke 10:7, Matthew 10:10, 1 Corinthians 9:14, 1 Timothy 5:18), and I try to fully embrace this even while I try to be frugal.
Your podcast takes time, energy, and money to run. You can podcast for almost free, but chances are that you have at least invested in a microphone and maybe hosting.
Your audience may not like when you start monetizing, but they often get over that soon, especially when the monetization method(s) you choose make sense for your content and audience. Even if they don't, it shows that they don't respect your time and talents enough to let you earn something from them—at least cover your expenses.
So there's really nothing wrong with trying to profit from your podcast, as long as you do it tastefully and in a way that fits your show.
What monetization model is right for your show?
There are essentially five ways to make money from podcasting:
- Premium stuff—selling exclusive access, bonus content, or ad-free versions
- Donations—letting your audience support the content they love by sending money or buying stuff for you
- Ads and affiliates—including a nonpersonal relationship in your podcast or website, like promoting your BlueHost affiliate link, or mentioning products on Amazon with affiliate links
- Sponsorships—a personal relationship between your podcast and a company for you to promote their products and services
- Self-promotion—sell your own products or services
In this list, #1 and #5 have the greatest profit potential. But any of these five could be a good or bad fit for your content. I don't promote donations with The Audacity to Podcast because that doesn't fit with my self-promotion and affiliates. I would actually rather you hire me to help your launch or improve your podcast than simply receive a donation (though I welcome any money anyone wants to give as a gift!).
But my entertainment-focused podcast about the Once Upon a Time TV show has its expenses covered from donations because people enjoy our content so much. (Some people have given more than $1,000 over time for a free podcast about a free TV show!)
Will monetizing hurt your podcast?
Regardless of what monetization model you choose, your implementation could potentially damage your reputation.
Let's take banner ads for example. A couple or few on your site may not be bad. But if you have large banners or they disrupt the flow of content too much, visitors will get annoyed and turn away. Ads can also slow your site loading speed, which can further hurt your reputation to people and search engines.
Even if your monetization fits your podcast perfectly, placing it in the wrong spot or handling it poorly can annoy your audience instead of encouraging them to take action. Remember that the only reason companies advertise is to get more customers, so your promotion needs to be a careful balance of motivating people to try the sponsor while still being personal.
What are the legal ramifications of monetizing?
If you make any kind of money from your podcast, you need to treat it just a little more like a business. This doesn't mean you have to incorporate, file extra taxes, or even that you can write-off podcasting expenses as business expenses. It all depends on how you structure yourself. (My podcasts are all officially parts of D.Joseph Design LLC and serve different purposes within the business structure. This allows me to deduct podcasting expenses because I can prove that podcasting is a major part of my business and not just a hobby.)
You should consult a tax professional on your specific situation. But the general rule in the US is that all income must be reported and is subject to income tax.
If you make any money from your podcast, this can also have bigger implications if you get into any kind of legal trouble. A hobbyist who isn't trying to profit may receive smaller penalties for a violation than someone who is clearly trying to profit by including ads, sponsorships, and affiliates. But I'm not a lawyer, so consult one for the best legal advice in your specific situation. I recommend Gordon Firemark.
Conclusion: Should you monetize?
Clearly, if you host your podcast as part of your business (or you want it to be), you should be monetizing it somehow!
If your podcast is a hobby, you never have to monetize it. But also don't let anyone tell you that you shouldn't profit from your investment!
- After a brief experiment, I have stopped sending automatic RSS campaigns to my email list. I'll share more lessons from this in a future episode.
- My article in the upcoming May issue of Podertainment magazine is about the importance and techniques for great show notes.
- My Podcast Reviews hasn't launched yet, but over 100 people have signed up to receive my free ebook “7 Ways to Get More iTunes Reviews for Your Podcast.” I shared some insights and pricing preview on Jason Hartman's Speaking of Wealth Show (episode pending).
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This post may contain links to products or services with which I have an affiliate relationship and may receive compensation from your actions through such links. However, I don't let that corrupt my perspective and I don't recommend only affiliates.