Do You Have The Time To Monetize Your Podcast?
Yes, it’s possible to make money selling ads on your podcast. Before you ask “how much”, you should be asking “how much time” and “is it worth it?” Here’s a real-world story that’s, well… depressing.
Time for some real talk about mid-level podcast advertising. “Real” as in I’ve lived in this true story for the better part of five months now. “Mid-level” means shows with a few thousand downloads of their episodes in 30 days. If you’re well over that: good for you! If your show is in that ballpark or have aspirational goals (and maybe a plan?) to get there, then read on.
I’m sharing very real numbers of impressions and dollars, though they are rounded up to their nearest 10s, the way your math teacher should have taught you. Partly to obfuscate the parties involved, but mostly to make the math easier to follow.
Putting On The Podcast Ad Sales Hat
The story starts months ago when I decided to court clients who have shows that get more than the much-lauded 5,000 downloads per episode number. According to conventional wisdom, that’s the minimum threshold that ad rep firms want to see before they’ll consider adding a show to their stable of publishers. And since I didn’t relish the idea of cold-calling advertisers all day to establish a direct relationship, going with an ad rep firm was a requirement.
I know several of the ad rep firms, so I chose one to try out. They started repping my client’s show a few months ago. What that means practically is that, from time to time, usually a couple of times a month but sometimes a few times a week, the ad rep firm contacts me with a potential advertiser for my client’s show. It’s an email with an overview of the advertiser, some information on the type of show and/or audience they’re looking for, and any other relevant details I might need to ascertain fit.
My job is to vet that potential advertiser. Do they offer a product or service that my client would be comfortable endorsing? Would it likely be of interest to the audience of the show? And are there any conflicts, either with the content of the show or existing sponsorships with competing products? I do this on my own most of the time, only bothering my client when something is in the grey area.
Reality Check: Most Podcasting Ad Deals Fall Through
So far, the ad rep firm has sent me around 35 potential advertisers. I’ve only declined two or three (they were not the kind of product that my client would be willing to endorse). With one exception, I heard nothing back from the ad rep firm on the rest. On the surface, that may sound a little dickish. But I know they’re fielding many deals from many advertisers for many shows, and they just don’t have the bandwidth to send a “sorry” note on all the ones that don’t pan out. Heck, I’m betting the ad rep firm doesn’t hear back from a lot of the advertisers even after they assemble a plan.
But back to that one exception. One of those potential advertisers converted into a real offer. One. If one-in-thirty odds sounds bad to you, welcome to advertising. I’ve been in this world for the better part of two decades, so I’m not surprised at all. Now, you aren’t either.
Making A Deal And Doing The Work
With an actual offer, I was able to (finally and for the first time) reach out to the client and work out the plan. They’d need to get the product shipped to them, would need enough time to try out the product to get a feel for it, and target a publishing date for the episode where the ad would run. Yes, THE episode. It’s not uncommon for advertisers to run a single ad on a single episode as a test.
Once my client and I were on the same page and we had a target publishing date, I officially accepted the offer from the ad rep firm. The ad rep firm then generated the insertion order, a document that spells out the particulars of the deal. Things like the target length of the ad read, must-have elements to be included in the ad, where the ad would run inside of the episode, and, of course, the money offered by the advertiser in exchange for the ad appearance.
Back on my client’s side, they get the product shipped to them, do the trial, record the ad spot, include it in the episode, and then publish the episode. (In theory, my client was supposed to tell me that the ad ran, but come on. You know that was on me.)
Making Mistakes and Making It Right When You Failed To Do All The Work
I’m the first line of defense. I’m supposed to (but did not) listen to the ad as it ran with the IO in hand to make sure we hit all the marks. Again, that’s what I was supposed to do. But I didn’t, which caused some extra work. A lot, actually. Instead, I just sent the media file URL with the time stamp of where the ad occurs to the agency. Like an idiot.
The ad rep firm is the second line of defense. They are also supposed to review the ad spot with the IO in hand, ensuring all the requisite details were included. But they didn’t. They just sent the info to the client. The client, however, did do the work we were supposed to do, and found problems.
They found problems twice, it turned out.
The first ad was great, but it ran in the wrong position. The IO clearly spelled out their request that the ad run somewhere in the middle 50% of the show, but the host opted to run it just a few minutes into the show at a natural breakpoint. The ad sounded fine there, but didn’t adhere to the rules we agreed to. So… we had to run a make good the next episode and wipe a little egg off our faces for not paying attention.
The timing was spot-on for ad drop #2, but we missed one tiny (but key) element, which effectively rendered the tracking of success for the ad useless. Boo for us, and is why we had to do another make good a couple of weeks later. (We wanted more time to make sure we got it right!)
So with the third-time’s-a-charm URL uploaded, the ad was finally verified by the ad rep firm and the advertiser. Hooray! Only… now a 30-day clock starts before payment issued. I’ll probably get paid faster than that, but business transactions take time, so businesses need the cash flow to keep going until invoices are paid.
“That sounds like a significant time investment, Evo.”
I didn’t do a job of tracking my time or my client’s time during this long and arduous process, but I’m estimating I’ve invested around 12 hours of my time to get this one deal. A lot of this was vetting the prospects that never panned out, and even more was probably spent on the back-and-forth of trying to get the ad run right. Yes, had I done my job better, we wouldn’t have had to run the ad three times to get it right. But even without that, I’d conservatively estimate I would have spent at least 5-6 hours.
On the client-side, I’m guessing four hours of their time. Much of that was fixing the screwups. But even without those unfortunate mishaps, there’s still the time to get the product, try it out, figure out the script, and work through the logistics with me. So a couple of hours at a minimum, right?
Show Me Some, But Not All, Of The Money
So what did we get for those collective 16 hours of work? $250.
Two-hundred fifty big ones. And by “ones”, I literally mean $1 bills. 250 of them.
Where did that number come from? It was in the official offer from the start and was based on the estimated downloads the episode should receive based on the historical downloads seen on episodes of the show. This requires the ad rep firm to have access to reliable, IAB 2.0 certified statistics for the shows they rep. And no, they don’t want you to run numbers for them. They want to log in and see for themselves. Apparently, podcasters often lie about or fail to understand their actual metrics. Go figure.
Typically, my client’s episodes get ~7,000 downloads. Some quick math done at the initial offer stage showed the advertiser was offering a $35 CPM. Wow! That was actually a very good number, a bit higher than I was expecting.
But remember, the $250 offer was a fixed number. Average downloads were used to calculate the offer, but the offer for that single placement on that single episode was fixed. Had something unusual happened and the episode in question received double the amount of downloads normally seen, they payment due would not have jumped to $500. Nope. Just $250. (Though if the spike became normal, then future ad offers would reflect the new average number of downloads.)
Only, we didn’t even get the full $250. That was the “gross” offer that we accepted, before the ad rep firm takes their 30%. They’re keeping $75 and sending me $175. And then I’m keeping 20% of that, so I’ll send the client $140 and line my pockets with $35.
That’s a lot of time invested to make $35, $75, or $140.
Of course, we do this in the hopes that the advertiser likes the performance on their end and sticks around for a while, running ads with us for months at a time that require very little additional work. This is where scale comes into play, though it takes time to work through the rough parts before the benefits of scale start showing up.
I’ll leave it to you to decide what your time is worth.
Here I go again with another harsh lesson. Sorry about that. Reality hurts. Chances are, there’s another podcaster in your life who really, really wants to run ads on their show. Maybe they need to hear this harsh lesson. Not to talk them out of it, but to make sure they know what they’re getting into. Send them a link to this episode. And let me be the bad guy. I can take it.
And if you’re so inclined seeing how little money I make from placing ads (which I do very little of and now you know why), you can show your appreciation by buying me a virtual coffee at BuyMeACoffee.com/EvoTerra.
I shall be back tomorrow with yet another Podcast Pontifications.