Podcasting's Advertising Problem Is Your Problem, Podcaster

Podcasting has a revenue problem. As with podcasting’s “discovery problem”, it’s unevenly distributed. We can make podcasting worth the investment, but only if we work together. Are you ready to help?

January 6, 2021

Article

Did you know that Twitter makes about a billion dollars every quarter? And that most of that billion comes from advertising revenue? Yet podcasting—all of podcasting—has yet to break that threshold over an entire year? Juxtapose that with the reality that more people listen to podcasts than use Twitter, and you get a sense of the imbalance.

Seriously. Show us the podcasters the money

But let’s be real: advertising on Twitter and advertising on podcasting are birds of a different feather. Twitter is a platform with a single interface that lets advertisers easily place ads to relevant—or not—users across the entire platform. Can’t do that with podcasting. I imagine Twitter’s revenue picture would be significantly lower if advertisers were forced to negotiate ad deals with individual Twitter accounts.

Podcasting’s Darling Doesn’t Scale

Buying ads on podcasts are a pain in the ass. No, I’m not even going to abbreviate that to make it more palatable. It’s freaking hard to do podcast advertising, regardless if you’re a buyer, a supplier, or someone in the middle. It sucks.

It sucks because the staple of podcast advertising, the host-read baked-in ad, cannot be scaled.

You don’t need me to link to the numerous studies that demonstrate the power of host-read ads. I believe it. You believe it. We get it. But that doesn’t change the fact that they haven’t been and can’t be scaled across multiple shows. Not easily.

Podcast Advertisers Are Lazy

While we’re all high-fiving each other for having a killer ad unit that’s hard to replicate in other formats, we’re forgetting a truism: Ad money flows to the easiest placements. That holds true for the advertisers who’re committed to advertising in podcasting. They’re spending money on podcast advertising, but in the easiest ways possible.

That’s why you’re hearing two, three, or more ads narrated in succession inside—or in front of, or behind—the episodes of your favorite podcast. Candidly, it’s your fault, working podcaster. It's your fault because that show has made it easy to place ads with them... and you haven't.

From Downloads to Addressable Inventory

To make it easy for advertisers to spend money on your podcast and spread the wealth, you have to utilize DAI—dynamic ad insertion.

With DAI, your episodes become more attractive to advertisers. Put in the parlance of the industry, DAI turns your episodes into “addressable inventory”. Because downloads alone aren’t enough and are, by definition, worthless to advertisers if they can’t run ads on them.

Getting Your Podcast’s Share Of The Revenue Pie

In the past, I’ve told you to ignore advertising unless you’re getting 50,000 downloads per month. I’m revisiting that advice in light of the maturation of our industry. Call me a flip-flopper if you want. I just call it adapting to reality. It’s a skill!

Even if your episodes only see a few thousand or a few hundred downloads in the course of 30 days, I still think you should open your episodes to DAI placement. Doing so doesn’t mean your show will start running ads you don’t approve in advance. Not at all. All you’re doing is setting your show up to be part of that easy money train mentioned earlier, but only when you are ready.

If you're not subscribed to Sounds Profitable, the weekly adtec newsletter written by Bryan Barletta and edited by me, you should be. This week, Bryan provided an excellent primer for DAI in podcasts and made a bold argument: If your media hosting provider doesn't at least have a plan to roll out DAI in the next few months, migrate away from that podcast hosting company.

Now, that's going to be a challenge. It’s a snap to seamlessly switch to a new host without impacting your show’s current subscribers/followers. The real headache is updating all of the embedded media players on your website, perhaps going back hundreds of episodes. Oh, and the non-trvial effort required to mark each episode for dynamic placement.

But it's a necessary and overcomeable obstacle if you’re going to help solve podcasting’s advertising problem. The good news is this is totally an outsourceable issue. If you turn it over to someone who’s careful and knows what they are doing, it can all happen behind the scenes with minimal involvement from you and zero impact to your listeners. Get in touch with me if you want to discuss that in more detail.

Or, if you have the time, do it on your own. But do it. And if you found the advice helpful and want to show a small token of your appreciation, go to BuyMeACoffee.com/evoterra and toss a couple of bucks my way. I’ll say nice things about you if you do.

But most importantly, help a friend podcaster with this. You probably know a podcaster who laments their lack of ad revenue. Well, they may not be a listener of Podcast Pontifications, which means they didn’t hear this advice and may be unaware that there's a podcast, a newsletter, a YouTube channel, and a website dedicated to overlooked “mid-list” podcasters who get overlooked.

That’s the underserviced audience I’m trying to serve with Podcast Pontifications: podcasters who clearly aren’t beginners and are still on their journey to making their show commercially viable. So please, tell a friend about Podcast Pontifications.

I shall be back tomorrow with yet another Podcast Pontifications.

Cheers!

Transcript

Podcasting has a revenue problem. But just like podcasting's discovery problem, it's unevenly distributed. Now we can make podcasting worth the investment, but only if we work together. Are you ready to help?
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Hello and welcome to another Podcast Pontifications with me, Evo Terra.
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Do you know that Twitter makes about a billion dollars every quarter? And most of that comes from advertising. But podcasting, we still haven't hit a billion dollars of annual revenue for advertising. Not even a billion.
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Yet more people listen to podcasts than use Twitter. Let me say that again. More people listen to podcasts than are users of Twitter. But we're out of balance on the revenue portion, at least four times out of balance. But that's just looking at Twitter. What about the rest of the ad dollars out there now?
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I realized that advertising on Twitter and advertising on podcasting, aren't the same. You just can't go to podcasting and say, can I advertise on you? It doesn't work that way. Where you can go to Twitter. Twitter is an entity. Look, you can't go - I can't monetize my Twitter feed. Right? That's not an option for me to offer advertising on my Twitter feed.
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That's it, right? Everybody understands that when you are advertising on Twitter, it is a company and there is no company that controls podcasting. It's different. And hence one of the problems, right?
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Because running ad campaigns on podcasts, on a podcast across all podcasting is, no matter which side you're on, whether you're the buyer or the supplier or the middleman, it's a pain in the buttinski. It is a challenge.
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That's one problem. Part of the reason why that is, that the ads we all love and we hold up as the highest standard because every survey, every study comes out that says, host-read ads are amazing, and they are, they do perform really well, I don't doubt any of those numbers, but host-read baked-in ads are not scalable by definition.
They might be scaled. They might scale for one show, but it's very difficult to scale that spread across multiple shows. And because of all of these things, the ad money flows where it can be placed the easiest. Ad money in advertising flows where the advertiser can place the money easiest.
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So if you're bothered by two to three ads narrated in succession from your favorite podcaster, it's your fault. It's your fault because they've made it easy and you haven't.
And the reason you haven't made it easy is you're not using dynamic ad insertion, DAI, as part of your platform. Because if you were using DAI with all of your episodes, then your inventory would be addressable to those advertisers as well. But it's not.
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See, this is an addressable inventory problem. It's not an inventory - it's not a - there's not enough downloads. That's not the issue. There are plenty of downloads. There aren't enough downloads that advertisers can easily tap into.
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It's a pain in the bud. So the solution here is to make more addressable inventory available. Now, maybe that means more inventory overall, but I'm talking about more addressable inventory.
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So even if you don't have a fifty to a hundred thousand downloads per episode show, you've got a much smaller one than that, maybe you're at hundreds or a few thousand of doing that. Still. If you open up your inventory via DAI, you will help alleviate this problem and let more money flow into you, as well as podcasting overall.
Yeah, it'd be great for you to grow your show, but come on, you try to grow your show all the time. What you need to do is make sure that you're allowing all of the ads to run where they possibly can run in your show so that it spreads out and there's more opportunities available for us.
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Now, if you're not reading Sounds Profitable, the newsletter by Brian Barletta, it's part of Podnews that I am the editor of, you totally should be reading that newsletter that comes out once a month.
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Sounds Profitable this week talked about the DAI issue and we'll continue to get into DAI, but as Brian said in that newsletter, if your hosting provider doesn't have dynamic ad insertion available, or doesn't have a plan to implement DAI very quickly, like in the next few months, get off that podcast hosting company. It's time to move.
Now, that's going to be a challenge. It's going to be a pain for you to make that move. It's not as easy as you probably want it to be. I mean, it probably is going to require you - not probably. It's definitely going to require you to update that embedded media player you have in every single one of your episodes.
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That's not going to be fun if you have 600, 700 episodes out there, but it's still necessary. The idea here is to fix this revenue problem that we really do have. And the way we do that is through DAI. And that means we have to go through some pain to get adjusted.
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Now I actually have been working on a plan to make that a bit easier or at least take the burden off of your shoulders.
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So if I have intrigued you with this idea, if you've known for a while you need to do this, you need to switch to a host that allows for DAI and you need to go through and tag all your passwords and all of that challenge, and you just don't want to do it, get in touch with me. I've got a plan, how we can make that - well, like I said, get that burden off of your shoulders. And make it a nice, seamless process.
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So get in touch with me evo@simpler.media if you want to talk about that option. Also, you could go to buymeacoffee.com/evoterra if you found what I just said intriguing. Toss a couple of bucks my way.
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But most importantly you probably know podcasters who have said, "Oh man, I need to do more with advertising. I need to make sure all of my content is addressable." Or something along those lines. Send them this episode. They may not know about Podcast Pontifications. They may not know that there's a podcast out there and a newsletter and a website, which is dedicated to all of those that get missed in the middle.
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Cause we're not beginners here. Well, maybe we're not making millions of dollars, but that wide spot in the middle, that's who we're trying to serve. That's who I'm trying to serve here with Podcast Pontifications - things to think about that make podcasting better for all of us.
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So please tell a friend about Podcast Pontifications.
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And I shall be back tomorrow with yet another Podcast Pontifications.
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Cheers.

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