The Myth of Easy Money in Podcasting

Why It’s Not the Right Path for Everyone

“No man but a blockhead ever wrote except for money.” — Samuel Johnson

“No man but a blockhead expects to make money podcasting.” — Alex Greenwood

In recent years, podcasting has emerged as the medium du jour, touted as a gold rush for content creators and businesses looking to cash in on the on-demand audio revolution. Amidst stories of celebrities signing multi-million-dollar podcast deals (many of which have cratered — just ask Harry and Meghan) and niche creators finding their tribes (and considerable profits), there’s a pervasive belief that podcasting is a lucrative venture open to anyone with a microphone and a story to tell. However, the reality is far more complex and less promising, especially for those solely looking to make money.

Take it from me. I’ve been doing this since 2006. Here’s why podcasting may not be the best path for everyone.

Saturation and Discoverability

In the last few years, the number of podcasts has mushroomed, with estimates suggesting more than five million podcasts and over 70 million episodes as of 2023. While this growth signifies the medium’s popularity, it also makes it increasingly difficult for new creators to get noticed.

Unlike YouTube or Instagram, where the platform’s algorithm helps in content discoverability, podcasting platforms are still catching up. Most podcasts receive little to no attention and often fade into obscurity, leading to what’s known as “podfade” — the gradual dying out of a podcast due to lack of listenership or revenue.

High Production Costs and Time Investment

Creating a high-quality podcast isn’t as simple as hitting the “record” button on your smartphone. Sure, the barrier to entry is relatively low — a decent mic, computer, and internet access — but it’s a steep mountain to climb to get noticed. Trust me. From purchasing the right equipment and editing software to spending hours on research, scripting, recording, and post-production, podcasting can be a time-consuming and expensive endeavor.

And let’s not forget the cost of marketing and promotion. While you might be passionate about your topic, the return on investment often doesn’t justify the initial financial and time outlay for many creators.

Wait, Did I say “often?” I think I meant almost never.

Monetization Hurdles

The primary ways to monetize a podcast are through sponsorships, listener donations, and merchandise. However, most sponsors are only interested in podcasts that can guarantee a large number of downloads. Listener donations and merchandise can provide some revenue, but you’ll need a highly engaged and large listener base for it to be sustainable.

Podcast advertising network requirements often stipulate a minimum number of monthly downloads — usually in the tens of thousands — before they’ll even consider adding you to their portfolio. This leaves the majority of podcasters without any realistic monetization opportunities.

In other words: it sucks to be you if you have a dedicated audience of fewer than ten thousand or so.

Audience Commitment

Unlike a blog post or a YouTube video, which can be skimmed or fast-forwarded, a podcast requires a significant time commitment from the listener. The long-form nature of most podcasts means that you need to provide considerable value to warrant such an investment from your audience. Growing an engaged listener base takes time, sometimes years, and even then, there’s no guarantee of financial success. Again, see above.

Niche Limitations

While finding a niche is often considered a good strategy for standing out, it can also limit your monetization options. Sponsors are less likely to invest in a podcast with a very niche audience, as it doesn’t provide them with the broad reach they usually seek.

However, as I have said often before, as podcasting continues to evolve and capture the world’s attention, it’s crucial to recognize the invaluable contributions of niche podcasts. These shows offer a respite from the mainstream, delving into specific subjects and creating communities of passionate individuals. Niche podcasts amplify diverse voices, foster personal growth, and provide an authentic listening experience.

With the right attitude and realistic priorities, podcasting is far from a waste of time. Just remind yourself, I am not doing this to get wealthy. Heck, I’m not even doing this to buy myself a coffee.

Get it a Try

If you are passionate about the subject matter, enjoy the opportunity to connect with people you may never meet in person, or see it as a part of your brand’s marketing mix, then it’s certainly worth a try.

However, before you invest time and resources into starting your own show, it’s crucial to have a realistic understanding of what you’re getting into — and what you’re unlikely to get out of it. One recommendation: Before starting a podcast, guest on a few. And read this and this.

Happy listening! And you’re not a blockhead being a podcaster who expects to make money— you’re just an optimist.

Learn even more by choosing my book on podcasting, The Podcast Option.