By Arielle Pardes
Call it the Podcast Renaissance. Those episodes of digital radio are experiencing a comeback, and it’s big: In 2013, the iTunes store counted 1 billion podcast subscriptions; a study by Edison Research found that almost 40 million Americans have listened to a podcast within the last month. And Serial, the murder mystery podcast that’s taken everyone by storm, has an average of 1.5 million downloads per episode.
So who’s cashing in on these things? If podcasts are to be the next big entertainment medium, how can they be monetized?
To Paywall or Not to Paywall?
The original model, which persists in some podcasts, is to fund podcasts by way of a download fee. Before a listener can access the podcast, they have to pay something to download it. If a podcast has enough super fans or dedicated listeners, then a paywall can be incredibly effective; but if a podcast doesn’t have a high degree of notoriety, a paywall can backfire, by pushing potential listeners away.
Other podcasts have leaned heavily on advertisers, in the same vein as radio. Like radio hosts, podcast hosts can read off sponsor messages or play pre-recorded commercials, which listeners can’t skip or fast forward through.
Talk About Sponsorship
Serial, which has been dubbed the most successful podcast of all time, is a spinoff of the public radio series This American Life, and sponsored by the email marketing company Mail Chimp (which is notoriously mispronounced in the ad as “Mail Kimp”). The ad, which runs for 20 seconds at the start of each episode, was called the “ad of the year” by Quartz—no doubt because of its endearing mispronunciation.
Midroll Media, a podcast-specific advertising company, has measured the efficacy of podcast advertising with show-specific promotional codes. The verdict? The return is immediate, in part because listeners can’t “look away” when an advertisement comes on.
They Can't Look Away
Advertising on podcasts might not have the wide reach of advertising on a TV show, but they have something else: specificity. Ads can tailor themselves to the content of the show, the potential listener, or can be made native by having the host read the advertisement. Using a plug from the host can ad a degree of credibility, and also ensure that listeners are paying attention.
Podcasts are poised to get even more popular in the coming year. If you have the chance to advertise directly to the listener—to get right in their heads, through their headphones—why wouldn’t you?