Everything you need to know about podcast monetization in 2021

Monetization in podcasting depends almost entirely on a sponsorship/ad-supported model. The reason is simple to understand; the limited 1-way broadcast offers no access to the listeners.

You can’t build an email list, you can’t ask questions, you don’t even know who the listeners are. All you can do is read ads (or have them dynamically inserted). This creates a host of complications for large advertisers who are still watching on the sidelines.

Ad-monetization is not fun:

• You have to dance around advertiser sensitivities.
• You’re vulnerable during economic challenges when advertisers stop renewing their contracts.
• You’re constantly under pressure to increase revenue by increasing ad-inventory (more episodes).
• Many podcasts are not designed for large audiences because their content is deep and niche-focused. Their lack of a large audience prohibits them from the opportunity to equitable monetization.
• Furthermore, finding and managing advertisers can be a tremendous burden for independent podcasters.

Invariably, podcasters are forced to find new revenue streams to offset these limitations. The most common recommendations are: offer your own products, start coaching, do affiliate marketing, and/or write books.

But all of these options are time-consuming, require new skills, and will greatly distract from the podcast itself.

While sponsorships certainly have their challenges, the listener-supported model can be even more complicated.

The top 3 listener-supported models:

1. Donations/tips

Similar to radio broadcasting, some podcasts run pledge drives asking their listeners to donate. Since most podcast players don’t support payments, 3rd party solutions are essential to facilitate the transaction.

The result is a high-friction customer journey: Find your phone, go to the Patreon website, create an account, enter payment information, etc.

While many listeners are willing to donate and support the show, the conversion rates tend to be extremely low. According to Patreon’s website, on average, 15% will go to your offer page and only 1–5% of those visitors will convert. This means that your net conversion rate is .00375% which is incredibly close to 0.

Further, the idea of “patronage” is not common anymore. Perhaps the closest parallel we have in our capitalistic economy is investors.

2. Exclusive content using private RSS feeds

In podcasting, offering exclusive content is a common way to solicit listener-support. To sweeten the pot, podcasters will often create ad-free RSS feeds to incentivize their listeners.

The exclusive content oftentimes includes extra episodes, behind the scenes, mini-series, back-catalog, early access, etc. Some podcasters even cut off their episodes at 75% and ask their listeners to subscribe for full access.

As one would expect, many startups have emerged making it much easier to subscribe to private RSS feeds. Utilizing native payment options and deep-linking the RSS feed, they’re able to reduce the friction for podcasters offering exclusive content for a monthly fee. Some of the more popular platforms would include Glow, Speaker, and Red Circle.

But making it easier to subscribe to a private RSS feed is still not compelling for many podcasters. First, most podcast players don’t support private RSS feeds, including Spotify and Pandora. Invariably, those users will be required to download and use a different player just to access the private feed.

Second, if someone stops paying and their feed stops refreshing, many players will stop supporting the feed entirely. Even if the user resumes their membership the feed will no longer work.

Third, it’s impossible to fully protect these feeds. When you send a private feed, anyone can post it on their Facebook and all of their non-paying friends can easily subscribe to the exclusive content for free. Some platforms will even go to the length of generating unique private URLs for each subscriber. But even then, you don’t know when a feed has been compromised. This requires policing, a burden many don’t wish to bear.

Fourth, every app has a different method for integrating/adding the feeds. Slate launched a premium membership called Slate Plus and admitted that their customer support staff “spends a large portion of her day helping people add the Slate Plus podcast feeds to their preferred podcast app.”

Finally, giving your core listeners an ad-free experience could be risky because the people who are likely to purchase from ads will no longer be exposed to the advertisements. If this negatively affects your ad performance, your advertisers could lose motivation to continue paying.

3. Exclusive paid community

Engaging with your customers/listeners is paramount to building a quality product. Since podcasting is an intimate medium, you can lean into the parasocial dynamics and offer your listeners a paid community. Not only do you create another revenue source, but also an invaluable feedback loop.

For example, a paid newsletter called Trends offers their members access to their Facebook group which helps convert and retain their members at a relatively high monthly rate.

However, setting up a paid community requires at least two independent platforms: one to manage the memberships and the other to facilitate the conversations.

You’ll need to utilize a platform like Memberful (which isn’t cheap) for your payments and CRM, and then give the members access to Discord or a Facebook Group.

Here are the challenges of this model:

• The administration can be burdensome.
• The customer journey is disjointed as users manage their accounts in one place and redirected to a new place for conversation. Many users will need to create accounts on both platforms.
• Some membership platforms feature their own social interactions which could confuse your listeners.

From an administrative perspective, if someone cancels or stops paying, you’ll need to manually remove them from the Facebook group and constantly check to make sure your lists are synchronized. This can get confusing because the users could have a different email on your membership platform than the one they used on Facebook. Do you really want to spend your time monitoring social media for rogue group members?

Finally, launching digital communities is not easy and will require additional content for discussion. As a podcaster, you’re already creating content (episodes) and now you need to find time to create conversation in your online community. This also can be time-consuming and challenging.

How is the Listen App different?

The Listen App project is the first of its kind to offer a robust community experience built into a podcast player. It’s a platform designed specifically to bridge the gap between you and your listener. Here’s what makes Listen App unique:

1. Your content is organically integrated

Your episodes are the perfect launchpad for conversation. Instead of repurposing your content for a different platform, now you can engage with your listeners right where they are listening to the podcast. Listen App features interactive episode rooms where you can see everyone who listened to the episode, hang out, and chat about the episode. You can even invite your show guests to participate in the discussion and answer any questions the listeners might have.

2. Your community is safe and secure

Unlike other open online forums, your VIP membership is accessed on an invite-only basis and you can easily exclude bad players. When you claim your podcast, you can generate an invite code and share it with your listeners by inviting them into a privileged space.

3. Your engagement is organic

You no longer need to send your listeners to disjointed platforms to access your service/offering. Now they can signup, listen, and access all social features in one place. You no longer need to prompt your listeners to remember to visit your Facebook page, or to remember about the Slack channel. Now their social engagement is integrated into the interface where they are already listening to your content.

4. Your VIP membership can be very profitable

The Listen App allows you to select perks and set up a paywall (coming soon!). You can offer exclusive content, ad-free listening, exclusive community, referral perks, etc, etc. The feature roadmap is filled with experiences that will transform your podcast.

5. Your listeners will have a premium brand experience

The platform you choose for your social interactions is part of your brand image. The Listen App uniquely stands out in product design giving you confidence that your listeners will not be disappointed.

6. You own direct access to your listeners

When joining your VIP membership, the Listen App requires your members to provide an email and explicit permission for you to contact them. By giving you the emails of your members you no longer depend on any since platform and own direct access to your core listeners.

7. You support an open podcast ecosystem

Unlike most other platforms making podcasts exclusive, the Listen App allows you to monetize while broadcasting widely. Any podcast can be submitted to the Listen App directory and we stand in full support of an open ecosystem.

Apply now to start building your community on the Listen App. Niche communities are the future, build yours in a place that makes sense.