You must have heard things like “This podcast is sponsored by…” while listening to podcasts. If you wonder why sponsors sponsor podcasts, then let us clarify it. Podcast sponsors are brands, businesses, or organizations that promote their products and services through podcasts. In return, these sponsors pay podcasters based on downloads, Cost Per Mile (CPM), or, sometimes, the podcast’s popularity. Now, you must be thinking about how much these podcast sponsors pay; we have an answer to your question.
Check out the article below to know:
As discussed in our article, What makes podcast important? As podcasts are the next big thing, they hold so much significance. Therefore, brands and businesses turn to podcasts to advertise their goods and services. Since podcasts stimulate the listeners’ hearing senses more than watching or reading, an advertisement will stay in their minds longer. This often leads to brand awareness and increased sales. Brands like Squarespace, Shopify, and DoorDash actively sponsor podcasts.
Here are the current Podcast rates:
- For a 30 seconds ad: $ 15-18 for 1000 downloads
- For a 60 seconds ad: $ 25-30 for 1000 downloads
These rates are calculated by Cost Per Mile (CPM) method. A CPM refers to 1,000 ad plays when a podcast is played. These rates often see their highs and lows depending on the market conditions and the holiday season. For instance, a report stated that in the year 2021. Holidays like Black Friday, Christmas, New Year, Halloween, and Thanksgiving led to high CPM rates. It is advised to podcasters to make the most of such times.
Apart from CPM, other factors that decide the price of a podcast advertisement might include:
- The niche of the product or the service
- Timing, as to when the ad is being played
- Length of the ad
- Number of listeners
Note: These prices are not fixed and can be negotiated based on the podcast’s popularity. Many podcasts doing well might have a fixed rate for their sponsors.
There are different podcast sponsorship models upon which the sponsorship price depends. Let’s take a look at these models:
1. Affiliate Marketing
This sponsorship model includes creating new customers for a brand sponsoring you. A portion of each sale is credited to the podcaster in such a collaboration. For affiliate marketing, brands and businesses might require a certain number of subscribers, total number of listeners, or streams. Such sponsorships work best for podcasts that have high engagement rates, which ensures the brand that is likely to generate new customers. Affiliate marketing gives authority to podcasters to promote the products and services in their own way.
2. CPM Model
As discussed earlier in the article about this model, Cost Per Mille or CPM model involves brands paying the podcasters based on the number of downloads of each episode. The standard rate for 30 seconds ad stands at somewhere around $15-18 for 1000 downloads, while for a 60-second ad, the rate stands at $ 25-30 for 1000 downloads. Since the CPM model pays the podcasters for every 1000 downloads, it makes sense that the podcast must have more than 1000 subscribers. The CPM rate can also depend on the previous episodes’ download numbers.
3. Value Based Sponsorships
In such types of sponsorships, a rate is negotiated between the sponsor and the podcaster, unlike the CPM model that pays based on 1000 downloads. They collaborate if a brand thinks the podcast is reliable enough and might help create new customers. Such type of sponsorships works best for small-mid size podcasts.
There are generally two types of advertisements that work through podcasts through sponsorships. These are:
- Host Read ad: These are the most common podcast advertisements, where brands usually provide the podcaster with an overview of the product/ service. The podcaster has to create a script with their own style. In many cases, the brand provides the script that the podcaster must read it out.
- Dynamically inserted ad: These are pre-recorded ads that are added to the podcast through ad servers. Since they are added through serves, they can later be edited easily. There are further divided into three types:
- Pre-roll ad: These ads are played at the beginning of the podcast and usually last for about 15 seconds.
- Mid-roll ad: Longer Ads, up to 60 seconds, are placed between the podcast. The rate of such advertisements is quite high.
- Post-roll ad: These ads are played at the end of the podcast. Since listeners often skip the end part of the podcasts, the rate of these advertisements is low compared to the other two.
Both of these advertisements can be placed in three portions of the podcast according to the suitability of the advertisement.
Frequently Asked Questions (FAQs)
1. How much do podcasters make on sponsors?
The revenue generated through podcasts depends on various factors, like the total number of downloads, the popularity of the podcast, and the
niche of the product/service that is being advertised. The CPM model allows podcasters to earn $ 15-30 for 1000 downloads.
2. How do podcasters get sponsors?
While the podcasts that are doing well in the market may attract sponsors on their own due to their popularity and high number of listeners. Podcasters who have recently started out can join various Podcast Networks and work with directories or can directly reach out to brands from sponsorship deals.
3. What are the benefits of sponsoring a podcast?
Since podcasts are gaining popularity recently, sponsoring a podcast can be a great way to market your brand through advertisements. It can help businesses to generate sales and spread awareness about the brand in the market.
4. What does a sponsor get in return?
After the sponsors collaborate with the podcasts to advertise their products or services, there are higher chances of creating new customers and increasing brand awareness.
5. How many listeners does a podcast need to get sponsors?
According to the CPM sponsorship model, podcasters get paid based on 1000 downloads. Therefore, having more than 1000 listeners is important to earn significant money through the deal.
We hope that the above article helped our readers to understand the payment models that take place between the sponsor and the podcast. Stay tuned for more such content!
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