Podcasting – It’s Not an Industry… Not Yet At Least

categories: Blogging

Michael Geoghegan (who hosts the Official Disney podcast among other things) is stirring up the podcasting community again (like the good friend who comes over to your house for an intervention) with an article titled “Podcasting – It’s a Community Not an Industry“.

I agree that “this is the year that podcast advertising takes off” seems like the slogan every year. At each of the last 3 Podcast Expos there was a meetup group about monetizing podcasting. The first year the group was just Paul Colligan and I and it has grown over the last two years. My feelings back in 2005 was that the whole ad selling process was harder than people realized based on my experience during the dot com boom at an advertising supported company. My guess at the time, as I recall, was that it would take 5 years for podcast advertising to take off. I signed with PodShow in 2006 in part because I did not see anyone else out there that I thought would do a better job and I thought they would help me grow my audience. A lot of people thought a potential 3 year contract was way too long, but I was pretty sure that I would be done with the contract before things really took off in podcast advertising anyway.

Part of the problem is that the whole advertising industry needs to change and that is only slowly happening. The money going into television is not proportional with the value that advertisers are getting from that media. The agencies actually know this now and a number of companies know this as well now. GM just announced that half of their budget next year ($3B) will go to the Internet. I would love to say that all of that will be for podcasting but that would be naive. I think that GM’s decisions is the beginning of a good trend but also of a period of instability and upheaval within the advertising industry.

The other unrealistic expectation that Michael did not touch upon was that advertising will pay based on what influence do you have and who do you influence. I have known people who have quit their day job to podcast when they have 50 listeners. That might be a good plan if you have a podcast heard by 50 billionaires.

When I was selling advertising on my own i was getting a $50 CPM for advertising on the Amateur Traveler podcast. But people spend more money online on travel than any thing else and my audience is not just composed of travelers but they are the people their friends ask for advise about travel (one of my listeners in Istanbul told the story her friends keep asking how she knows so much about different destinations) so many podcasts should not expect rates at that level. So best case, even if I was able to sell out advertising every week, traffic of 80,000 downloads a month would pay me $4000 a month or $48000 a year. My wife and two kids are all in private college so that would not be quit your day job numbers for me. And as Michael points out, podcast are generally not selling out ad inventory every week.

So is podcasting done? I don’t think so. Is it taking off slower than most people expected? Certainly. Will some companies go through hard times? I think so (see the rumor that PodShow is doing layoffs). But I also see some positive signs.

  • The audience for podcasting is growing. Dollars will eventually follow the eyes and ears.
  • Well known brands are starting to get more regular advertising by big brands, at least in my sector of podcasting which is travel. If advertising comes to podcasting on a regular basis we should expect it to come first to podcasts from old media. I expect that advertisers will start with the people in their rolodex until their is more demand than supply and then they will branch out to the larger podcasts and then they will look at aggregation of smaller podcasts. This is what I expected in 2005 and what I still expect in 2008. Of course, I also still expect that 2010 is the year podcast advertising will come together.

My plan is continues to continue to grown my audience and keep podcasting… for now at least. My plan is not to quit my day job… for now at least.

by Chris Christensen

I am the creator of AmateurTraveler.com, a popular travel blog / podcast. I am also a co-host for This Week in Travel podcast, The Bible Study Podcast and the Passport Marketing and PR Podcast. I am the owner of BloggerBridge.com and a software consultant.

3 Responses to “Podcasting – It’s Not an Industry… Not Yet At Least”

Gary

Says:

$48,000 a year would do many people just fine, especially if you aren’t living in the bay area 🙂

I think lag is with ad agencies. They have a system in place to put ads on TV and radio. They call Bob who is the sales guy at the station, they know the routine, they know the costs, and Bob will send the agency a Christmas card at the end of the year. It is all a very familiar world.

The fact that podcasts might infact provide a better value might not matter, at least right now.

There is a big information problem. How do you know what the best shows are in a certain space? How do you know the number of listeners? How do you know the demographics of an audience? It is all sort of a mystery and may always be more of a mystery than TV and Radio are.

The fact that an advertiser might be able to get better deal on Amateur Traveler than on the Travel Channel might not matter unless there is a middle man who can facilitate the exchange between big companies and smaller sites (which any podcast would be compared to a large cable channel).

Jason Van Orden

Says:

$48,000 is especially not enough when you consider that you have a bit of overhead and then the tax man that takes his chunk. Regarding taxes, people have to also remember that when you are self-employed (as most podcasters selling ads are), you have self-employment taxes as well.

Clearly a viable freelance/business solution for making money with online content must include a strategy that expands beyond ad placement.

This is getting my head buzzing for my own blog post or podcast on this subject.

Love your pic in this post!

Dave Granz

Says:

Hi Chris. Nice podcast… while I just found it and just listened to a few of your shows, I’m impressed with how well done they are. Great job!

-Dave Granz

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