“Nobody makes money from podcasting!”
“It is impossible to generate income from podcasting!”
I hear these statements, and others like them, all the time.
Recently, I was involved in a forum discussion where someone posted an idea they were considering for a music podcast that would include licensed music. The concept of paying for ASCAP, BMI, and other various licenses didn't seem to sway him from his desire to pursue this concept with great passion.
Regardless of the amount of people who seemed to discourage his idea of pursuing, what seems to them, as a dead end road, this person did further research, evaluated the costs, and continued to remain positive and passionate about his pursuit of this project.
I was so impressed with his determination that I wrote…
Take it from someone who makes a pretty good amount of money from podcasting (Something that 99.9% of the people out there will tell you is not possible)……
What you wrote above is the type of DETERMINATION that it takes to find success in making a living from your passion.
Please keep us posted on where your journey takes you.
In response to this post, someone immediately posted….
Cliff, do you make your money from podcasting or from podcast consulting?
Here is what I wrote in response…
The answer to both questions is YES!
Last year, my business made JUST OVER $53,000 FROM PODCASTING ALONE.
Here's the break down….
Commission Income is where I will mention a product or service in my podcast and people will use my affiliate link to purchase that product or service. When they do, I earn a commission as a result.
The people who create these products or services are not sponsors of our shows, I simply have an affiliate relationship with them. In 2010, my business generated $7,380.59 of income from recommending products and services within my podcasts.
Sponsorship income is where I have a contract with a company who believes in my podcast and I believe strongly in their business. These sponsors pay a flat fee per episode to be named as the sponsor of the show.
I DO NOT provide them stats on download numbers. Last year my business brought in $18,500 of income from podcast sponsors.
I only bring on a sponsor when I believe it will be a win/win/win situation. This means it must, “first,” be a win for my audience, it must, “second,” be a win for the sponsor, and “third,” it must be a win for my business.
I ask my sponsors to track the return on their investment on their end. This is typically done through the use of a promo code or trackable link.
One of my sponsors recently reported that the use of my promo code, from one of our shows, generated 266 Orders which resulted in $14,951.32 in sales, within a single month. I will not reveal the number of people who subscribe to this podcast. However, I can tell you that if I told you, you would be IN SHOCK!
Contributions From Listeners
As you can see, contributions from our podcast listeners brought in $27,201.70 in income to my business in 2010. From March of 2008 through December of 2010, we had set it up to where a majority of our podcasts had a free feed where anyone could get one or two episodes a month of every show for free.
However, most of our shows are recorded on a weekly basis. Those who wanted to gain access for every episode of every podcast that we produce, they could become a Plus Member for $10 per month. This is where the $27,201.70 came from.
JUST OVER $53,000 FROM PODCASTING ALONE
You can add those up and see why I have a hard time when someone says “NOBODY MAKES MONEY FROM PODCASTING, they only make money from promoting something else they do.”
This is why I DID NOT INCLUDE the $28,693.22 that my business generated from digital product and webinar sales. Though, my podcast is the primary way I market these products, I agree that I had to do something else, outside of just podcasting, to generate this income.
Major Note About Product Sales Income
I want to point out that the “Product Sales Income” report above DOES NOT include the EXPENSE SIDE of the equation.
You see, I did sell $53,926.67 in podcasting equipment in 2010. However, I had to pay my suppliers $45,257.87 of that income to actually pay for the equipment that I sold to my clients.
So if you do the math, you will see that I only generated $8,668.80 of income for my business from Equipment sales in 2010.
This brings the total amount of income generated by my business in 2010 to $132,030.70.
Do you make your money from podcasting or from podcast consulting?
Yes, my business does generate a good deal of income from one on one consulting, group coaching courses, etc. But as you can see, I do, in fact, make a good deal of income directly from my podcasting efforts.
One More Note About Charging Money For Podcasts!
In 2010, my business generated just over $27,000 of income from people who paid to have access to all our podcasting content. In January of this year, we made the decision to give 100% of our podcast content away FOR FREE.
That's right, I took something that generated $27,000+ of income, made directly from my podcasting efforts, and decided to give IT ALL AWAY FOR FREE! Do you want to know what I was thinking when I making this decision? CLICK HERE to listen to episode 486 of Pursuing A Balanced Life.
For the first few months of 2011, we made more money from voluntary contributions than we did when we were actually requiring people to pay for full access to all our content.
As 2011 rolled on, I got so busy with my other business pursuits that I neglected to market the benefits of supporting the content and community of gspn.tv through voluntary Plus Membership. So there have been a handful of months where we had been bringing in about $300 to $400 a month less this year, than we were last year.
But then this came in.
I literally could sit here and write about this subject all day long. However, if you ever hear someone say “IT IS IMPOSSIBLE to earn income from podcasting directly”, then feel free to point them to this post. The direct URL to this post is http://PodcastAnswerMan.com/income.
So Should We All Quit Our Jobs To Do Podcasting?
I am not going to tell anyone else what they should or should not do. We all have to take the responsibility for seeking out our true purpose and calling in life. For me, I knew that meant leaving my very successful career as an insurance agent in a family run insurance agency to pursue podcasting full-time as my career. And yes, much of my income does come from products and services that I offer that I do outside of recording and publishing podcast episodes.
My full story (From December 2005 through June 2011) can be found in this video:
I Am Not An Over Night Success Story!
I hope that those of you who might be impressed by all this talk of generating income from podcasting will watch the entire video I posted above. I think it is very important to express to you that I have been working at this for more than five years and I have put in WAY MORE THAN MALCOLM GLADWELL'S TEN THOUSAND HOURS of hard work to get to where I am today.
One of my favorite quotes about the “myth of the overnight sensation”comes from Jason Fried's book “ReWork.” (Affiliate Link). In the book, Jason wrote…
You will not be a big hit right away. You will not get rich quick. You are not so special that everyone else will instantly pay attention. No one cares about you. At least not yet. Get used to it.
You know those overnight-success stories you've heard about? It's not the whole story. Dig deeper and you'll usually find people who have busted their (butts) for years to get into a position where things could take off. And on the rare occasion that instant success does come along, it usually doesn't last. There's no foundation there to support it.
Trade the dream of overnight success for slow, measured growth. It's hard, but you have to be patient. You have to grind it out. You have to do it for a long time before the right people notice.
Should You Try To Make Money Directly From Your Podcasting?
This is not meant to encourage people to make money from their podcasting efforts. While I would argue that I “may have needed” to require the Plus Membership contributions for full access to my content for the time that I did, I believe that I am better off giving it all away for free and producing content that people feel is so valuable that they are willing to support it.
I don't have time to go into the complexity of handling a “donation / voluntary contribution” model of generating income from podcasts. I will simply say that if you are remotely considering this model. Don't expect that income to start rolling in! Most people I see going this route end up sounding desperate and as if they are begging their audience for support. This is one of the worst things I think any podcaster can do. And trust me, I speak from personal experience!
I think there are other ways of generating income, from your podcasting efforts, that would work for a higher percentage of podcasters. Sponsorship is something that you can pursue if you have a niche focused podcast with a loyal audience that knows, likes, and trusts you. I would encourage you to consider purchasing my Passive Income Strategies For Podcasters Tutorial to get the basic understnading of generating passive income from your podcasting efforts.
I will agree that there are few people who are successful at generating income directly from their podcasting efforts. I would even argue that doing so may not be the best strategy. However, the main purpose of this post is to simply say that it is possible!
Then again, I believe that if someone is truly called to something and they have the Passion, Talent, Determination, Self Discipline, Faith, and Support of their spouse, if married, that just about anything is possible!
[UPDATE February 9, 2013] This post was originally written on August 26th, 2011. As I am writing this update to this post, it is February 9th, 2013. I wanted to share to share an update on how the income from my online efforts have progressed.
My business income for 2010, as shared above, was $132,030.70. My business income for 2012 had increased to $210,560.41. I recently produced episode 295 of Podcast Answer Man where I shared, very transparently, how much personal income that this produced for me.
The following information is from the show notes of that episode.
Just yesterday I met with my CPA and filed my business and personal tax returns.
My “PERSONAL INCOME” for 2012 was $122,000 — that is more money, in a single year, than I ever made in my previous career in insurance.
In addition to that, my business paid the following benefits:
- Business Equipment (read fun tech gear) = $9,000
- Continuing Education (books & such) = $800
- Meals for Business Meetings (Lunch Meetings With Stephanie) = $2,800
- Rent Income From Business = $4,200
- Travel Expenses (mostly business “vacations”) = $10,700
These listed benefits adds up to $27,500.
I don’t share these numbers to boast or brag about what I’ve accomplished. Instead, I share them to inspire people when they see what can be done when you pursue your dreams and passions. [End Update]
[UPDATE February 26, 2014] Wow! So many things have changed since I first wrote this post back on August 26th, 2011. I am quickly looking above to see that I gave an update about this time last year where I shared my Business and Personal Income for 2012. I've decided to come and post another update to share just how amazing things turned out for 2013.
Before I share my 2013 income, I want to point out that this post originally started as an inspirational post in response to those who consistently argue that it is not possible to directly generate income from your podcasting efforts. I believe that I have demonstrated that you can, clearly, with the original post, and I still very much believe this today.
With that said, I've had quite a mindset shift on the concept of pursuing podcasting as a career/occupation. Yes it is possible for folks to generate income DIRECTLY from your podcasting efforts in these ways. However, I have come to a place where I do not believe that a podcast should be looked at “as a business” or “as a career” FOR MOST PEOPLE. Are there exceptions to this? Yep! However, I have found it easier to succeed when you actually develop a genuine business where you offer products and/or services that provide value to your target audience. As people come to know, like and trust you, they can then make a decision to purchase your products and/or services, or the products and services of those you recommend.
If you have been considering podcasting as a career or an occupation, I strongly encourage you to listen to episode 324 of Podcast Answer Man that I titled “Podcasting As An Occupation? How Long Before My Podcast Will Start Generating Income? My Thoughts On This And More!”
I was still generating income directly from my podcasting efforts from Advertising, Sponsorships, Voluntary Contributions From Listeners, Affiliate Sales, etc in 2013. The fact is that if I wanted to, I could have drastically increased the amount of revenue generated from these activities. Instead, however, I intentionally made a decision to focus less on these streams of income as my own personal dreams and goals changed for the reasons I shared in episode 324 of my podcast.
Okay, so with that in mind, here's what my 2013 Income looked like.
As you can see, my Gross Business Revenue for 2013 was $512,278.56. However, let me explain that of the $140,036.58 that came in from equipment sales. I had to immediately turn around and pay $121.024.01 of that to my equipment supplier that shipped all those podcast equipment packages for me. That means that my PROFIT from equipment sales was only $19,012.57 for 2013. This really brings my Gross Business PROFIT to $391,254.55. This is still quite an increase from my 2012 report.
Here are some interesting numbers to compare with my 2010 Income Report posted above.
Commission Income: In 2010 my income from commissions was $7,380. In 2013 it was $36,019.01. The reason for this drastic increase is due to the fact that I made a decision to pursue affiliate commissions and referral commissions as a priority over the past two years. Going back to the original intent of this post, this is one line item that is still DIRECTLY a result of my podcasting efforts and I actually do see this number increasing, dramatically, over the next several years.
Consulting Income: In 2010 my income from one-on-one consulting was $40,681.39. However, in 2013, it dropped down to $25,865.27. The reason for the drop is that I stopped offering one-on-one consulting and coaching back in mid 2012 so that I could focus my attention on my Podcasting A to Z course and my Podcast Mastermind organization. Most of the income listed here came from a single contract that I had for a significant bit of work that I performed for one company. This is not an income area that I'm looking to increase moving forward. However, I still may offer some consulting and coaching options from time to time.
Digital Product Sales: In 2010, my income from digital product sales was $28,693.22. This increased to $40,139.55 in income from digital product sales. This is an income stream that I expect to drastically increase in 2014 and beyond.
Equipment Sales: This was listed as “Product Sales” on the 2010 report. If you read the post above, very closely, you will see that my profit from equipment sales in 2010 was $8,668.80. In 2013, my profit from equipment sales had jumped to $19,012.57. This, also, is an income stream that I expect to drastically increase in 2014 and beyond.
Sponsorship & Advertising: My income from sponsorships in 2010 was $18,500. In 2013, the income from sponsorships of my podcasts had dropped to $5,400. The reason for this drop is that I made the decision to end several sponsorship relationships so that I could focus on other areas of my business. I do not have any plans to seek out any new sponsorships for any of my podcasts in 2014. However, if the right offer were to come along, I would certainly consider it. It's just not a focus for me.
Contributions From Listeners: In 2010, my income from contributions from listeners was $27,201.70. In January 2011, I made the decision to give all my content away for free. In 2011, I ended up bringing in MORE INCOME from Voluntary Contributions than when I had previously been requiring payment for the premium content that I was creating. Of course this is mostly due to the letter and check shared in the image posted above. Still, the income from this area of my business in 2011 was $27,823.23. It dropped to $7,412.75 in 2012. It dropped even further in 2013 to $4,184.11. Why the drop?
The reason is that I made a conscious decision to no longer pursue income from this source. Yet, again, to the original point of this post, all the income that I shared in these two paragraphs of this post was all DIRECTLY RESULTING FROM MY PODCAST CONTENT. Also, please note that I didn't even mention how much income was generated in this area from 2008 and 2009. You can add approximately $30,000 more to the total figure. I do not have any plans to pursue this stream of income any longer. However, It is still possible for folks to make voluntary contributions to support the content that we create and many people do still make such contributions.
Speaking: In 2010, I hadn't even considered public speaking as a possible income stream. In 2013, I was paid a total of $2,920.00 to speak at a conference. My speaking fees have increased since then and while I do enjoy speaking at conferences, I do not seek out these opportunities. When a request to speak at a conference comes in, I evaluate my interest on a case by case basis.
Podcast Mastermind: In 2010, the Podcast Mastermind hadn't even been thought of yet. I made the announcement about the launch of the Podcast Mastermind on January 26th, 2012 in episode 246 of Podcast Answer Man. In 2013, the Podcast Mastermind generated $57,075.76. On February 6th, 2014, I announced that I was shutting down the Podcast Mastermind. I shared all the reasons why I chose to shut it down in episode 344 of Podcast Answer Man. As of the date of this update, Episode 344 is BY FAR THE BEST EPISODE I HAVE EVER PUBLISHED. I highly encourage you to listen to that episode.
Podcasting A to Z:. Yet again, here is another item in my 2013 income list that did not exist in my 2010 report. In March 2011, I launched my first ever Podcasting A to Z online training course. That first course had completely sold out and was such a huge success that I offered it again two months later and sold it out again. In fact, I've now offered this course a total of fifteen times and it has SOLD OUT EVERY TIME with an average of 30 students in each session. In 2013, my Podcasting A to Z course generated $200,356.34 in business income. I have plans to continue offering Podcasting A to Z and I suspect that the income from this course will either be about the same in 2014 or it may see a $20,000 to $30,000 increase.
So yeah. 2013 was a good year for my business and, Lord willing, I feel like I'm only just getting started. If you watched the video that I posted above, I shared that my personal income in 2008, my first year in business, was ONLY $11,000. Yes, the business made more than that in 2008, but $11,000 was the total amount of net income I brought home that year.
In 2013, my business paid me a salary of $122,292.00. However, as the sole owner of Ravenscraft Enterprises, LLC, I received $156,941.00 in retained earnings as a result of the profit from my business. This means that my Adjusted Gross Income (Personal Income) for 2013 was $279,273.
Here is an image from the front page of my 2013 1040 personal tax return.
There were even more exciting things that were not reflected in the numbers shown above. For example, the business purchased, WITH CASH, a 2013 Honda Pilot for our business use. Also, our family had a business trip with the 2013 gspn.tv community Disney Dream Cruise.
I know that I said this in my update from last year, but I want to remind folks that I do not share these numbers to boast or brag about what I’ve accomplished. Instead, I share this information to inspire people by showing what can be done when you pursue your dreams and passions.
Please know that I feel that it may be very dangerous to see these amazing things listed in this February 2014 update! I want to stress that nothing that I have accomplished has come easy to me. I have taken many risks along this journey and made more sacrifices than most people would be comfortable making.
If you are encouraged or inspired by these numbers that I have shared, I VERY STRONGLY ENCOURAGE you to watch the entire video embedded titled “How Our Podcasting Journey Began” as well as EVERY PODCAST EPISODE LINKED in the updates made to this post.
Thank you for reading!
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