ROI for podcasts is a phrase that gets tossed around quite a bit in the podcasting industry. From those first introductory podcast episodes to the role of podcasts in the digital ecosystem, ROI for podcasts is important for podcasters every step of the way. But what is ROI for podcasts?
In this Mr. Thrive Media blog, we’re diving into ROI for podcasts, what it means, what the types of ROI are, and how it relates to the way you podcast. If you’re a seasoned podcaster or you’re just starting the process of writing a business plan for a podcast, read on, this is the place for you.
What Is ROI for Podcasts?
Before we get into the specifics of direct and indirect ROI for podcasts, we’re taking a look at what ROI for podcasts is. ROI, or return on investment, turns up in every type of business, brand, and venture. It’s the benefits you get from your venture.
Those benefits can be monetary in nature. They can also come about in with networking and referrals, and in all sorts of community building. ROI for podcasts is, essentially, anything you get from having a podcast that keeps your podcast and business moving forward. These three types of ROI are the basics you can expect in the podcast industry.
3. Industry Experience ROI
Industry experience ROI is all about the credibility you’ll gain through hosting your podcast. As you produce episodes, invite industry guests, and dive into your podcast subject matter, you’ll build a podcast that is a source of industry knowledge. Over time, that industry experience can turn into higher-profile guests, new clients, and a reputation that precedes you in all the best ways.
2. Community ROI
Community ROI comes from the listeners who tune into your podcast over and over again. There is a direct ROI you can expect from the blanket of community ROI, which is a build-up of listeners, leading you to higher profits. The indirect ROI, however, is even better in many ways. Building your community gives your podcast a firm place in the industry of podcasts.
1. Monetary ROI
Monetary ROI is, naturally, very important for podcasters. You can build it up through direct ROI strategies like sponsorships and affiliate marketing. You can also grow your monetary ROI returns as you build your network and gain clients through that growth. Monetary ROI can come from several channels across your podcast business.
Direct ROI Strategies for Podcasts
In the world of ROI, there are direct and indirect ways of getting those returns. Direct ROI are the returns you see from specific acts through your business. You put time and focus into these efforts, and see results directly from those efforts as they pay off at different paces.
These three direct ROI strategies for podcasts are the most common and the most consistent with the returns you’ll see from them. They all have their pros and cons. When you’re looking for direct ROI from your podcast, these three strategies should be in your game plan, for both immediate and passive income.
3. Merchandise Sales
Merchandise sales make up a quality portion of direct ROI for podcasts. Your merchandise sales can bring in some primarily passive income, with the main work coming from getting items made and shipping them out. Once you get started, that work becomes commonplace, and you can let merchandise sales work for you.
2. Affiliate Marketing
Affiliate marketing, where you earn a commission when people buy a product or service through a link you provide, is a good way to gain consistent ROI. When you seek out affiliate marketing opportunities, make sure you’re working with businesses that are in line with your ethical guidelines.
1. Sponsorships
Sponsorships are one of the key ways of getting direct ROI for podcasts. That said, sponsorships require a great deal of time and effort. They are worthwhile in the long-term because they help you build up your podcast with other brands. They should be a part of a multi-faceted approach to podcast monetization.
Indirect ROI Strategies for Podcasts
The other side of ROI for podcasts is the indirect channels of ROI. These are the benefits you can look forward to without putting specific plans in place to see these returns. Of course, you have to put work into your podcast and be open to these returns. The opportunity for them, however, will show up organically.
These three routes of indirect ROI strategies for podcasts are some of the best for building your community and your business. They’ll show up as you host guests, work on your skills as a podcast host, and get more comfortable in the podcasting industry.
3. Testimonials and Industry Credibility
Testimonials and industry credibility and two facets of indirect ROI for podcasts that go together in many ways. Testimonials from clients and from podcast guests give you a tangible source of reference on your podcast and your way as a business owner. Those build into industry credibility over time.
2. Listeners Acquiring Services from Provided Links
Listeners acquiring services from provided links is part of the world of affiliate marketing. When it comes to indirect ROI, however, the listeners who get services and products through your links are separate from that direct ROI. When listeners find new products and services because of your podcast, it builds up your credibility within your community.
1. Guests Becoming Clients and Referrals
Building up a great community of listeners and podcast guests is one of the key long-term goals of any podcast. One of the best forms of indirect ROI comes from building that community. When it comes to your guest community, those people have the strong potential to turn into future clients and referrals for clients and network connections.
Frequently Asked Questions About ROI and Podcasts
Learning about ROI for podcasts can have a steep learning curve. How do you initiate direct ROI strategies? When can you expect to see results from indirect ROI efforts? How do you calculate those intangible ROI factors? How do you factor all those facets of ROI for podcasts into your podcast business plan? Those are just the tip of the iceberg.
Our answers to these frequently asked questions will give you further background on ROI for podcasts and why it’s important to understand your ROI. Managing your podcast ROI and knowing how to measure it can be stressful. With these answers and this blog here for you, however, you can work through learning about ROI for podcasts and gain control over your ROI.
What Is the Average ROI for a Podcast?
There isn’t one strict average ROI for a podcast. When you dive into this question online, you’ll see a range of answers. You’ll find the average ROI for a singular ad campaign in a podcast is $2.42, but that’s only for ads as part of your ROI. There are sources saying a 60% ROI on awareness is what you can expect in terms of engaged listeners. It’s quite the mix.
All that goes to say, ROI for podcasts varies depending on the podcast niche, the direct ROI strategies being used, and the community around the podcast. Successful podcasts do tend to have a satisfactory ROI. Your ROI is something you’ll discover over the first few months and then years of having a podcast.
How Do You Calculate ROI for Podcasts?
You can measure ROI for podcasts in several ways, but one key method is:
X downloads / X amount you’ve invested in your podcast = Y
Y x 100 = Your ROI for downloads over production and marketing costs
That formula gives you the worth you’ve gotten from downloads, in relation to the investment you’ve put into gaining those downloads. You can also factor the monetary amount you’ve made into a formula like this, to see the numerical ROI.
Are Small Podcasts Profitable?
Small podcasts turn a profit that is generally consistent with the size of the podcast. You can turn a profit with a small podcast. If you’re comparing yourself against large-scale podcasts, however, your profits won’t be on that level. You can easily earn a few hundred dollars from each episode with time and dedication to building your small podcast.
How Many Listeners Does a Podcast Need to be Profitable?
How many listeners a podcast needs to be profitable depends on the desired profit, but generally having more than 200 listeners per episode is a good place to start. That will get you headed in the right direction. From there, building up to several thousand listeners will help you grow your profits.
ROI and Podcasts: The Boomerang Investment of Podcasts
The ROI for podcasts is widespread. It’s dependent on your podcast content, your listeners, and your dedication to the craft. You can put work into all of those areas to boost your ROI and keep your podcast going strong.
If you’re looking for support in your podcast business, reach out to Mr. Thrive Media. Our team of marketing experts, podcast production pros, and virtual assistants at the ready can help you work on your ROI.