Is Selling Ads On Your Podcast Worth A Dime?

Podcast advertising is how many podcasts achieve commercial viability, but that requires scale and the amount of scale is always increasing. Here's where the bar is set today and what that means to your podcasts. Bottom line.

Hello and welcome to another podcast. Pontifications with me. Evo Terra. You know, podcasting is the weirdest industry. The same people who ask, what is the absolute cheapest way I can get started? Podcasting are the same ones who week later say, how much money can I make when I sell ads on my show? It's a weird, weird difference between, I want to know money invested, but I want all the money on the backend.

It's natural. I'm like, that's unique to podcasting, you just the way that you know people's brains work, they want. Yeah, I get it. I totally get it. So when I was at podcast movement evolutions, 2020, that's a lot of words. Uh, last week I spent a lot of tension listening to what people were talking about in the new ad tech world.

This new, well, it's not really new, but this ever-increasing world where advertising and making money, making shows commercially viable. You heard me talk about that on Monday, was the big theme. And a big part of that is advertising dollars, right? How much money can you actually make? And I think that that's something worthy of a conversation.

So we're going to have it today. Your concept of your idea, if your desire is to make a commercially viable show, how much do you need? How much can you make with the quarterly viable show? So it's as a supply and demand problem at its, at its heart, you know, you can, the reality is, look, if you suddenly get a really popular show, yeah, maybe somebody will reach out to you and say, Hey, your show's popular.

I'd like to sell advertising for you. But that's usually not the way that it works. When you build a show up to a certain level so that it becomes attractive to advertisers. And then you take that new found attractiveness and tell. The people who sell advertising about your show, and you can do that by going to the big networks out there.

There aren't nineteens that podcast ones, those kinds of people, so that they, with those with a team of sales reps can say, Oh, now that you're on our platform, we can see how much you do. Great. Let's go sell advertising. Or you stay where you're at and you contact a company like a true native media. Hi Heather, and say, Hey, I've got a show that's worthy of your consideration.

Let me go. And occasionally, very occasionally, you actually might hear directly from advertisers who might reach out because they've seen you get listed on them on a list somewhere. Somebody else has told them about you and you say, Hey, that's the right kind of audience for us. Um, we'd like to advertise on your show if it's big enough.

And that's really the big factor here. If it's big enough. Now for the longest time, the, if it's big enough number has been around 5,000 by the way, I don't mean 5,000 total downloads over the life of your show. I mean 5,000 downloads of an episode of your show after the course of 30 days. Which, by the way, if your podcast hosting company doesn't make that easy for you to see, I feel ya.

But nonetheless, you have to understand it. Services like chartable, by the way, chartable will give you that information. Yeah. Anyhow, 5,000 downloads used to be the really. The, the number that you would use to get attracted to become attractive to the people who spent spent money on advertising? Well, at podcast movement evolution is 2020 in LA last week.

No one was using that number. That number is dead. I think it might still be viable for some, but the number that was floated around was double that or quadruple that. Or in some cases, 10 X that. One advertiser on stage says 50,000 minimum. That's 57 50,000 downloads per episode after 30 days minimum for them to consider advertising with you because for them it's scale as well.

I heard another ad sales company say 20,000 is the number they're looking for. Some have said, you know, they'll, they'll, they'll maybe back down to 10 if there's an existing relationship or they have ads already running on other shows, and your show fits that demographic. Ten thousand twenty thousand fifty thousand not 5,000 and certainly not 150 so that's the reality.

And I wanted to break that reality down for a moment and move that reality from, can I get advertising to, is it going to be commercially viable? And I did a little bit of math and the math isn't hard. Trust me when I do the math and my math works, something like this. Let's say that you have 5,000 downloads per episode, and let's say that further than that, you get, let me pull my numbers up here on my sheet.

So it's exact. Let's say that you are 5,000 downloads per episode and you're selling 50% of your available inventory. I think that's a realistic number. Some of the podcasts that I talked to sell a lot more than that. Some sell less, but let's say 50% so only half of those episodes can you sell ads on on a regular basis, and maybe you're willing to do two ads per episode and you do an episode every single week.

So that's four episodes per month. And then finally you're getting a $25 CPM. I've seen him more. I've seen less on average $25 CPM. If you do the math on that, those 5,000 downloads become $500 per month, $500 per month, which means a dime per listener. It's really hard to run. I think you would agree, a commercially viable business.

With a revenue stream of $500 per month. If you double that, if you have a thousand if you had 10,000 listeners, then you've got $1,000 a month. Also very hard to run a commercial lead viable business with a revenue stream of an income stream of $1,000 per month. Can you run a side hustle? Sure. Can you pay for your hobby?

Absolutely. But thinking about commercial viability, that's what it requires. The 50,000 number, not only to be attractive to the people who sell the ads, but also it shouldn't be attractive to a business person who says, how can I keep that going? But remember, $5,000 a month is not a fortune by any stretch of the imagination.

That's, that's a decent starting revenue stream, but you have to have other things really happening before it's commercially viable. So I say this to you, the working podcast or who may not be at that level but wants to become at that level to think about it this way. Those ad spots you desperately want to sell, have to be a value to the other person.

Do the person on the other side giving you money rather than nickeling and diming yourself at. $50 a month, $100 a month possible ad revenue. And again, I'm not begrudging you that, I'm just wanting you to think of it a different way. What have you spent those ad spots on yourself? What if instead of advertising for somebody else, you advertised for yourself, not your product and service, although maybe you could do that, but a pretty successful podcast or I spoke with last week said, don't underestimate the power of.

Telling your people, giving them one action item for an entire year, and that single action item is to tell your listeners to tell someone else, just one more person to listen to the program. Instead of confusing them with, go here to give me money. Go here to rate and review this show. He says, looking at himself directly.

What if you just said, go tell someone about this show. How would that work for you? Speaking of that, go tell someone about this show. Would you, you're a working podcast or do you know whether they're podcasters? Are they listening to podcast? Pontifications man, I'm thinking it might be an interesting experiment for you just to pick up that email, grab a tweet, do something, and just tell someone, check out podcast pontifications this dude has some interesting thoughts you should know about.

Let's give it a shot. Okay. And in the meantime, I shall be back tomorrow with yet another podcast. Pontifications cheers.

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