Ad rates vary widely in podcasting right now. I’ve heard figures ranging from $15 up to $80 CPM. I also know of “effective CPM” quotes that go above $150. What I mean by “effective CPM” is that the money wasn’t earned from a traditional ad buy. The term “effective CPM” is instead used to figure out how much money a podcaster is making through other means divided out per download.

“Effective CPM” is one interesting way of measuring relative success of monetization within your own podcast from campaign to campaign or episode to episode. However, it can easily become an apples to oranges comparison when put up against figures from another podcast, mostly due to variances in the measurement of downloads/listeners.

This is where we need an accepted standard so that we can speak dependably about podcast monetization across the board.

Jason

I agree 100% with your/Tim’s comments. I’m not a fan of the “old media” CPM model. The problem with the CPM model is that it fails to qualify the true value of podcasting–the niche audience (as you stated), the relationship with your audience, etc. If podcasters limit themselves to CPM advertising, they’re greatly limiting their ability to make money. Podcasting falls in the long tail of content.

The CPM model was created for media in the least common denominator “head of the curve”. It’s not the ideal solution, but it seems to be where the discussion has started. We need to be creative about how we monetize podcasting and sell it to the ad world.

Podcasters need to remember this when seeking sponsors and setting ad rates. Grape Radio charges healthy rates without ever quoting how many listeners they have.

Concerning the measurement of listens (whether with AxL or some other solution)…true, podcasting is already more measurable and focused than newspaper or radio. There’s no need to “hold podcasters to a higher standard”, however, if we could measure listening habits (on an optin basis) wouldn’t that be of value to sponsors and podcasters? It’s just one potential tool to help.

Jason

Thanks as always for the great insights and info!

Also, the old media method of CP/M breaks down, because, paraphrasing Bourquin, "It doesn’t matter if your podcast only has 3 listeners if those listeners are Steve Jobs, Larry Ellison and Warren Buffet."

you referenced John Federico’s AxL initiative that urges Apple to provide a method of reporting if a particular advertisement was indeed heard. I thought about this, and I wonder why, if a radio station sets their rates based upon the population beneath their tower’s footprint combined with Arbitron ratings from as much as months before with virtually no assurances that a particular ad was actually listened to by X number of people, why then hold podcasters to a higher standard?