Podcast Advertising Rates: Reach vs. Conversion

Podcast Advertising Rates: Reach vs. Conversion

Are podcast advertising rates worth what it’s doing to your audience growth??

We’re seeing some new trends in advertising rates, specifically low-paying podcast rates, which means it’s time to have a conversation about how this will affect podcast hosts, listenership and show growth.?

Low, Lower, Lowest

Right now, advertising rates are on the decline, which is shocking considering how bad advertising is going everywhere else in the marketplace. One of the reasons for this is because certain programs are putting a limitation or requirement on ad insertions. This means they require 10,000 or 20,000 downloads per episode before a show qualifies for ads.?

In podcasting, what we’ve learned is that niche shows that are branded well, don’t need that many downloads to be considered successful. Additionally, the most successful, engaging shows often fall under the category of “micro-influencer” rather than influencer.?

Niche Over General

These qualifications are designed to feed “general” ads into shows, rather than specific brands that are relevant to the audience of the show or the show's subject matter. For instance, Procter and Gamble or Ivory soap fall under the category of general. As a host, when you begin to look at the target and the angle, it is then up to you to determine which one is best for you and how much your listeners are worth.?

?Let’s Talk Dollars

AdvertiseCast, which is owned by Libsyn, is looking at advertising in the way a lot of older school advertisers do in podcasting. It is going to assign a certain market value to 1,000 downloads of your episode. After the fact, they are going to pay you how many downloads you get for the month where that ad ran. If it is 10,000 downloads, then they are going to pay you $21 per 1,000 for a 60-second spot. Is $210 for 10,000 downloads worth it to you? This rate is likely to be closer to $15 if you are doing a 30-second spot.?

For comparison, we have some podcasts on Podetize with about 30,000 plays per month, and they were doing a CPM model as a way to charge for the advertiser but we are getting about $150 per 1,000 because they had an advertiser that was very much in alignment with the kind of audience that they knew they had.

They are making very good money. It ended up being like $4,500 to $6,000 over 1 or 2 months for this advertiser to advertise to their audience because the audience was a perfect match for the products and services the company wanted to advertise. It was working month after month for this relationship, so they kept coming back.

Authority Advertising: Your podcast is more valuable to an advertiser that is in alignment with your subject matter with your show or your audience profile if that is identifiable.

New hosts, starting their shows, often get sucked into these advertising programs because they think the few hundred bucks to cut down costs will be helpful. What they don’t realize is that they’re most likely on the hook for a 60-second spot and it is usually placed at the very beginning of your show.?

From The Listeners' Perspective

So new listeners press play on an episode, they get hit with a minute-long ad, and then comes your intro - which is usually too long - and your listener has already lost interest. They want to get to the real content and you’re not giving them that opportunity. Add to that the fact that the ad they’re hearing may or may not be relevant to them, you’re outright hurting your show.?

Authority Advertising: Your entire goal as a host - first and foremost - should be to add value to your listener. Whether that is through content, ads, or guest interviews, that is up to you. But this needs to be the central focus of everything that touches your show.??

When it comes to numbers on paper, we can actually see how advertising with the wrong brands hurts growth. Shows that have ads that are not relevant, not very tightly relevant to their audience, and the ones that do that streaming on the front and back typically have on average a much lower percentage of audience growth factor.

For more on advertising rates and how they directly affect your audience and growth, listen to this episode of Feed Your Brand with Tom and Tracy Hazzard.