…and the monetization of relationships
Podcasts. I’ve written about them before, and I’ve recommended them to just about everyone I talk to.
A couple of years ago I wrote about how they can improve your quality of life, filling in the “dead” moments of going to the grocery store, working out at the gym, folding the laundry… Filling them in with conversation, ideas, information, humor, debate, stories and fun. But I realise now that back then I missed the point. Yes, you do get all those things. But you also get something else really important, that as human beings we seem to want.
Podcasts fill in the gaps in your days with intimacy.
Of all the media available at the moment, podcasting is the most like a relationship. Yes, even more than YouTube. When you read, it’s your voice in your head. And the written word, while very stimulating, does not have the same level of immediacy as the spoken word. It’s not nearly as intimate. Compare receiving a letter from a loved one. Lovely, emotional perhaps, but not nearly as immediate and heart-warming as an actual conversation. With podcasts, you have someone murmuring things in your ear, or you have people chatting and laughing around you. And we tend to listen to podcasts while we are doing other things: driving, cooking, ironing, doing sit-ups… Podcasts accompany us on our daily activities, and that creates an even deeper intimacy.
Furthermore, they lack the “neediness” of text-based media and video. To read something, you have to be still, and you have to focus. Try reading something while walking the dog. It ends up being an unsatisfactory experience for you, and probably for the dog as well. Video watching may require less concentration (although it seems to hold our concentration pretty well), but you still have to be still. I once tried watching a movie while running on the treadmill. I got nauseous.
And there’s the comfort level. Audio is arguably the medium for which humans are most naturally wired – we were listening long before we were reading, and the oral tradition is still strong in most cultures. Listening feels good, it’s soothing and comforting. And easy.
With conversation, there is so much more going on in terms of tone and nuance. Text tends to be black and white, with the occasional blue hyperlink. Audio provides subtle cues and human idiosyncrasies, quirks that we can relate to and become fond of. Imperfections, subtext and unspoken emotion add layers of understanding which further deepen the relationship.
It feels personal. Our favourite podcasts become our favourite because there’s a connection. We enjoy the podcaster’s sense of humour, tempo, voice. We become friends, in a non-creepy way.
And therein lies the real economic value of podcasts. The monetization of that relationship.
Remember Kevin Kelly’s 1000 true fans theory? How all a creator really needs is 1000 true fans to be able to make a living? In the podcast world the figure is probably higher than that, but with a relatively small audience (compared to online media, anyway), the opportunities are there.
First, the ads. In the world of digital media, podcast ads are a different breed. There does not exist yet (that I know of), an adblocker that can stop audio. And fast forwarding just the right amount is tricky and usually not worth it – I’ve tried, and I always end up overshooting.
Furthermore, most podcasts don’t have advertisers so much as sponsors. The podcaster at some point in the show thanks the episode’s sponsors, and talks about them a bit. Since you have a “relationship” with the podcaster, you’re more likely to listen to him or her than if it were a generic ad. Some manage to make the ad interesting and fun. I was listening to an episode of Sampler the other day, sponsored by Sabra guacamole (a guacamole brand sponsoring a podcast??? whatever), in which the producer challenged the podcaster to find it in the supermarket. They actually recorded the challenge in the supermarket. It was entertaining. And I would happily listen to anything that Roman Mars of 99% Invisible reads. Really, anything.
The extra attention and personalisation is why podcast ads (or sponsorship announcements) command a much higher price than their two-dimensional equivalent. Web ads can go from $4/cpm (clicks per 1000 prints) to $11 for targeted ads. Podcast ads tend to average around $25/cpm, and some can go as high as $100. According to media agency Midroll, podcasts that get 25,000 downloads a month can pull in between $60,000 and $100,000 a year. Those that make it into the iTunes top 100 can make at least four times that amount. Not bad for a medium that has relatively low production costs.
Second, there’s the ticket sales for the live events. Podcasters with a certain following can (and most of them do) announce a live chat, interview or recording. Top shows almost invariably sell out.
Why would we pay to go? Because we know this guy or gal, we want to go and hang out with him or her for a while. It’s very similar to paying to see a band you like play live, only you have no idea what the content will be. But it doesn’t matter, you’re there for the conversation, even if you don’t get to participate a whole lot. Media company Slate has had such success with the live shows of its podcasts that it started selling tickets to live cocktail sessions with the hosts prior to the recordings. They usually sell out within minutes.
Some podcasts are experimenting with “memberships”, which give us access to sneak previews, premium episodes, live chats with the host, behind-the-scenes videos – all designed to make us feel even more part of the show, even more “connected”, even more “friends”.
The relationship of podcasters to their audience is totally different to that of text media. And this changes the monetization mentality. Obviously podcasters deserve to be paid for their work, time and talent. But there does seem to be a shift from putting a price on your attention, to creating a relationship of value.
Perhaps this is where media is headed. There is so much content out there vying for our scant attention that the way forward could well be through a lasting relationship, which is extraordinarily difficult to achieve with the click-and-you’re-gone technology that is the internet. Even the stars of YouTube with their loyal fans know that the experience is full of distractions, with pre-roll video ads and a column of me-too recommendations. YouTube wants to hold you with more and more videos that you will watch and share and like and pay for with your attention. It is a relationship based on distraction, perhaps ideal for the younger audience at which it is aimed. While podcasting is a business, the emphasis is very much more on intimacy, and the grown-up type of loyalty that that engenders.
True, podcasting is a new sector, and the struggle of monetization is ripe for innovation. Radio is essentially the same medium, and we all hate radio ads, with the sudden increase in volume, the cheesy jingles and the overly cheerful voices. Could advertising on podcasts go the same way? I very much doubt it, simply because we, the listeners, prefer the subtlety of a voice that we know and trust murmuring in our ear. And the metrics will show – once we figure out how to collect them – that the intimate approach works better.
The implicit relationship is why podcasts will continue to enjoy steep growth in offer, demand and potential. New platforms are springing up all over the place to make podcasts easier to listen to, share and monetize. The technology still needs work, but more platforms means more metrics, and more metrics means more finely-tuned delivery and marketing. Which should increase profitability for some, partially level the playing field for others and increase the (already high) level of professionalism in the sector. And along the way, nudge us into re-thinking what we want from our media, our relationship with advertisers, and how we can improve the overall digital content experience.
(This article also appeared on Medium. I’m experimenting with publishing there as well as here. What do you think?)