Podcasts are getting to be mainstream — and the money is starting to follow.
According to Edison Research, approximately 46 million Americans listen to a podcast every month, or about 15-17% of the population.
The most obvious cause of this growth is Serial, the real life detective story that the New York Times called “podcasting’s first breakout hit.”
From what we hear from the advertising side, there are millions of dollars to be made.
The info comes care of Adam Sachs, the CEO of Midroll, which acts as a broker between podcasters and advertisers. His agency represents some of the biggest names in the field, like WTF with Marc Maron, Star Talk with Neil deGrasse Tyson, and Savage Lovecast with Dan Savage. Sponsors include HBO, Squarespace, and Hulu.
Sachs says that a “handful” of his company’s 2,000 clients gross over a million dollars a year, of which Midroll takes a 30% cut.
Podcasters with high, but slightly less superstar, status also bring in a lot. Sachs says that a weekly show with 100,000 downloads an episode (enough to land it on the lower end of the iTunes top 100) with a standard advertising load of five spots would bring in between $US250,000 and $US400,000 in revenue a year.
Those figures are thanks to podcasting’s high cost-per-impression (CPM) rate relative to other forms of media.
• Midroll has a few shows with a near $US100 CPM, with the most common being about $US25.
A podcast ad is a “premium product,” Sachs says. The host does his or her own reading of the script, making it less of an interruption than display or video ads. Plus, as the Washington Post reports, podcast listeners have longtime relationships with their favourite shows, making them all the more attractive to sponsors.
Quietly over the past couple years there have been great content creators who have obsessive, growing audiences like Marc Maron.
“Marc Maron, when he goes on the road and does a show, he has to bring one small bag for clothes and one giant bag for all the stuff that people bring him,” Sachs tells Business Insider. “They’re obsessed with him and those relationships have developed over time.”
This has all been very good for Midroll. From 2013 to 2014, its sponsorship business tripled.
“We’re helped by the fact that the industry has grown as we’ve grown,” Sachs says.