Small Business Saturday Blog

Podcasting - the Ultimate How-To Guide - Part 1

Thursday, April 05 at 09:31

I am a successful, award-winning podcaster with an amazing American producer and a following in the hundreds of thousands now from all over the world. 
So podcasting, let's talk the good, the bad and the ugly. The truth is, we are in a golden age of podcasting. A report recently showed that podcast listeners doubled back between 2008 and 2015, and then increased again 23% between 2015 and 2016. In the U.S. alone, there are more than 57 million monthly listeners. 
After all, audience = money, right? 
I mean there is John Lee Dumas, Pat Flynn and Lewis Howes who have all made millions in podcasting. This has led many to try and make moolah in this medium. But here’s my advice to those of you thinking of starting a podcast to make money: Maybe be realistic in your expectations!
I’ve been on the radio and podcasting space for ages and even studied radio broadcasting. I started hosting a podcast in 2016, The Guestlist Podcast, with a handful of early listeners to over a hundred thousand monthly listeners today. As a result of hosting TGP, I’ve had a chance to speak around the world, make the SmallBiz100, make friends with the known and titans of industry. I’ve been mentioned by The Guardian and various other media. 
But more importantly, even though I’ve been doing this for a long time and have one of the better pedigrees in the medium, it’s never been easy and it’s not easily profitable.
Let's start with how podcasts make money. 
Most people who start a podcast think that the ka-ching will come rolling in after the audience gets big enough. Everything will come, the sponsors and the advertisers and then you simply just collect the cash and wash, rinse, repeat. But sadly that equation doesn’t work the way you think it does.
But let us show a more realistic recipe:
Start with: landing the big advertisers, you need to be part of a network. 
Then, to be part of a network, you need to have at least 20,000 downloads per episode, and you won’t get there for a while. It took me ages to get to that level and keep in mind that “back in the day,” part of each episode was explaining to people how to download a podcast. I know people who got there in four, but I know more people, who are professionals in their industry, who in ten months of podcasting are not close to 2000 downloads per episode and they have flat-lined. That’s respectable, but it’s still a long way away from being able to demand ad revenue.
Then before you even sign a deal with a network, you have to be okay with them taking a 40-50% cut of gross advertising revenues.
One of the most popular shows has ad revenue in the range of 40k- 50k/month. This variance is due to several reasons. For one they can’t choose how much inventory is sold in any given period and they also can’t control how many advertisers are in the market at any moment, you can’t choose what advertisers are willing to pay and let us not forget about seasonality. 
The dreaded "S" word, SALES. 
Then once you pay your production costs, whatever is left over is your profit. My production costs are 800/month for 8 podcasts per month. So, on the high end, the “podcast” of The Guestlist Podcast could net 40,000 a year (40k annual revenue – 10,600 production costs), but that’s also because I take no salary from the podcast division as it’s part of my marketing outreach for the show.
40k sounds like a lot. It is a lot. But keep in mind that we only started pulling in revenue in the last few months and for the first year the "podcast" was not cash flow positive, hence you see me doing so many other things to help carry me. I've had little to no sponsor revenue and was spending 800 a month without the promise of immediate return. If you were to add up all of my "lifetime" expenses and revenues, I’d suspect we’d be just barely in the black after two years.
My podcast features both ad opportunity and an opportunity to sponsor parts of the show, not to mention my public speaking opportunities geared around the topics I cover on the show. There’s a virtuous circle in which our content is informed by my revenue opportunities and vice versa. So, yes the cash flow now looks good, but I needed help to get there, and I may very well have not gotten there if we didn’t have the infrastructure and support from my producer, Bret Farmer, from the other side of the world.
The uncomfortable truths about podcasts:
It requires more personality than you likely have!
The technical qualifications for starting a podcast are the ability to speak English, a microphone, and an internet connection. The qualifications for a successful podcast are…much much more complicated.
To be even an average podcast host, you have to have the ability to guide a conversation, to pull out insights, to drill down when you need to. It’s not at all like a conversation between friends, and even those get off-track. You’ll often be interviewing complete strangers with whom you’ll need to build rapport shortly before going on air. And to be candid, you probably don’t possess those skills right now.
The second dreaded "S" word. You can’t outsource or scale most of the work. 
Let’s say you do outsource the audio editing, engineering, and production work. You can’t outsource your prep, I’ve tried, and it doesn’t work, trust me.
If you interview guests, you are going to need to read their books or articles or watch or listen to their interviews. Check out the masters of Prep: James Altucher and Tom Bilyeu. 
Showing up with a list of 10 formulaic questions isn’t just going to be a poor experience for your guests — after a while, you’ll hate it too. I’m 2 years in, and I do more of the prep work than ever before (usually up to 5 hours per episode). As I said above, I tried outsourcing this before and hired staff to read the books for me and put together relevant notes and interesting questions, but as I began to get into the craft, the deep work of being a host, I wanted to read those books and create those questions myself, and at now only one podcast per week ( used to be two episodes per week), I can tell you I read a lot. 
Next week we look at editors and producers and perhaps some alternatives to podcasting that might work for you!
The host of The GuestlistPodcast  

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