How can I make money from podcasting?
This is one of those questions I get all the time, and the first thing people tend to think of for podcast monetization is sponsorship.
Of course, having someone pay you for a mention in your episodes seems like a no-brainer.
But the truth is, it’s not always that cut and dried.
There are certain podcasts that can benefit from a sponsor and some that will find sponsorship actually doesn’t make sense—or money, for that matter.
So in this article, I’m going to explain what kinds of shows will (and will NOT) find sponsorships worthwhile, as well as how to get top-paying podcast sponsors if it turns out this is a good option for you.
Deciding Whether A Sponsor Makes Sense For Your Podcast
If you’ve read our other articles (specifically How to Start A Podcast That Gets You More Clients), then you know that our bread-and-butter strategy for podcast monetization actually doesn’t involve sponsorship.
I’m talking about the approach we recommend for coaches, consultants, premium membership businesses, professional services, online course creators, and similar style businesses.
If you fall into this category, then sponsorship is probably not the best route to go.
Because for these kinds of businesses, you’ll find your highest podcasting ROI comes from using your show as a way to educate, motivate, and build trust.
In a nutshell, you want your episodes to help listeners get small results as a way to build up your “know, like, and trust” factor.
Then, when they are ready to make a bigger move to get a bigger result, they choose your product/services/offers to make it happen.
(For more on the specifics of how this works, check out How To Be An Amazing Podcast Host: 5 Tips To Turn Listeners Into Clients and How a Podcast Should (And Shouldn’t) Fit Into Your Growth Strategy.)
This is a powerful, proven strategy that can easily be hindered if you dilute your connection with your audience by throwing in sponsorships.
That being said, if you’re not running a business that falls into one of these categories and you want to make extra money from your show, then getting podcast sponsors can be a good move.
Below, I outline a couple of ways you can do it.
The Two Types of Podcast Sponsorships
When it comes to getting a sponsor for your podcast, you essentially have two choices:
- The Standard Sponsorship Arrangement
- The Deal-Maker Sponsorship Arrangement
Each can be beneficial and lucrative in the right situation, but there are certain things you have to keep in mind in order to make them work.
Let’s break them down one at a time.
The Standard Sponsorship Arrangement
The typical sponsorship in the industry pays a fixed rate for a fixed outcome.
Generally, this will be either a CPM (cost per mille) setup that pays per thousand downloads or a CPA (cost per acquisition) arrangement that pays for the number of sales or sign-ups the sponsor gets as a result of your ad.
Typically, a CPM arrangement pays from $10 to $25 per 1,000 listens.
The amount varies depending on the length of your sponsor’s ad and where it is placed in your audio.
A typical ad will run from 15 to 60 seconds, and it can be a pre-roll that goes before your main show content, a mid-roll that goes in the middle, or a post-roll that goes at the end.
Here are some general guidelines for pricing:
- 15-second Pre-Roll: $15-20 per 1,000 listens
- 60-second Mid-Roll: $20-25 per 1,000 listens
- 30-second Post-Roll: $10-20 per 1,000 listens
With a CPA setup, on the other hand, you can usually earn from $15 to $30 for each person that buys the product or service as a result of your ad.
Please note that these are industry standards, not fixed rates. You can always try negotiating your own terms.
Now, with either of these typical sponsorship arrangements, keep in mind that they will only bring in real income if you have a significantly large audience.
Even with a listener base of 10,000 people, you’ll make some money, but you won’t exactly be raking it in.
And before you argue that John Lee Dumas is making a ton from his podcast sponsors, it’s worth noting that his audience is MASSIVE and he does three or four podcasts every single day.
I have no problem with this model, it’s just not a likely match for your current situation to make a profit with your podcast.
So unless you’re speaking to hundreds of thousands of regular listeners, a standard sponsorship setup is probably not going to be a huge income earner for you.
But if you have a smaller audience and you’re interested in giving this style of sponsorship a shot to generate some extra side money, crunch the numbers and see if it makes sense for your show.
The Deal-Maker Sponsorship Arrangement
This is the sponsorship setup I recommend for your average podcaster.
In essence, the deal-maker arrangement involves reaching out to specific industry partner companies to organize a deal where they sponsor your podcast or a set of episodes of your podcast.
And because there is no industry standard for this type of arrangement, you can create whatever setup you think will work best for you, your intended sponsor, and your combined goals.
Just keep in mind that this approach is based on the value your sponsor would get from being featured on your show (as opposed to a CPM or CPA rate that is typically pretty cheap comparatively for your average podcaster).
That means you’ll need to think of how partnering with you would justify the cost of sponsoring your show.
It’s also important to note that—as the name suggests—the deal-maker sponsorship arrangement is totally reliant on your deal-making capabilities as a business, so be prepared to put on your negotiating hat.
In case you’re having trouble envisioning how this kind of deal might look, here are a few routes I’ve seen podcasters take:
1. Mentioning the sponsor in the podcast audio and adding the company’s link to the show notes with a line that says the episode is brought to you by that company.
2. Interviewing key members of the sponsor’s operation or business as a paid interview. In essence, the sponsor pays to be interviewed on the podcast and exposed to its audience.
3. Doing a topic-based sponsorship where the theme of the podcast episode ties into the audience getting some sort of benefit from using the sponsor’s service or a service like theirs.
Of course, the arrangement you choose will have to benefit you and the company you plan to reach out to as a potential sponsor, so you’ll want to take some time to think about what would make the most sense for both parties.
For a great real-life example of how one podcaster made custom sponsorships work, check out Case Study: How Alan Moore Sold $7k in Sponsorships Before His Podcast Launched.
An added benefit of this approach is that it can also help you build credibility.
If you partner with companies that do exceptional work and support your industry—and only reach out to businesses whose offerings you use yourself and really believe in—you can create some really interesting industry partnerships.
And if you are game to negotiate and customize your sponsorship setup, this can potentially earn you more per thousand downloads than the standard sponsorship approach.
Where to Find Potential Podcast Sponsors (And How to Reach Out to Them)
Now that you have some good ideas for how podcast sponsorships can work, it’s time to figure out where to find potential sponsors and how to approach them.
I recommend you start by looking at industry conferences that align with your listenership.
Note which companies have paid for a booth or get mentioned as a conference sponsor.
Those are prime businesses you can reach out to.
Send a message to one of their contacts letting them know that you noticed they sponsored the conference, that your podcast audience consists of the same type of people who attended the event, and that you’d love to expose their company/values/what they do to your listeners for a much lower cost.
Try something like this:
I noticed that Home Security Professionals was one of the sponsors of the Rental Property Owners Club conference last month, and I love what your company is all about! I’m reaching out because I know my Rent Your Property Like A Pro podcast listeners would be very interested in learning about your home security services.
My audience is very similar to the conference attendees, and I know that a paid booth can get really expensive—especially on top of hotel and travel costs—so I’d love to spread the word about what you do to protect property owners at a much more manageable rate.
We get over 4,000 downloads per episode, and we’re getting more each week. If you’re open to hopping on a call, I’d love to discuss a potential sponsorship opportunity.
Thanks and I hope to hear from you soon,
Host of Rent Your Property Like A Pro
The key here is to highlight that it’s exposure to the same type of audience and a potentially comparable number of people at a discount.
To get ideas on pricing, look up how much the conference sponsorships cost on the event website, add that to hotel and travel costs, and make sure your number comes in well under that total when divided by the number of people in the audience.
Then create a package for a specific number of episodes for a specific rate that costs less than someone would pay if they were to sponsor a conference or put a booth together.
Once you get that figured out, put your deal-making skills to the test.
As I mentioned at the beginning of this article, the advice I shared above is aimed toward podcasters who don’t intend to use their podcasts as long-term lead-nurturing tools for their businesses.
But if you decide that getting podcast sponsorships makes sense for you, the above advice will help you to find the sponsors and arrangements that are right for your show.
And if you still aren’t quite sure whether it makes sense for you to start a podcast at all, make sure to check out WHEN Should You Start a Podcast? (And When You Shouldn’t).
Do you have more suggestions on how to get podcast sponsors? Share them in the comments below!
Ben Krueger is the founder of Cashflow Podcasting and he specializes in helping thought leaders and entrepreneurs amplify their impact through podcasting. He’s a world traveller, outdoor sports junkie and future enthusiast!