One of the four key elements of a remarkable podcast is monetization.
We’ve talked about indirect vs. direct monetization, but today we are going to talk about the pros and cons of two types of direct podcast monetization: sponsorships vs. affiliate marketing.
This episode is brought to you by StudioPress Sites.
As we weigh them both, remember that it does not need to be either/or.
Lots of podcasters are seeing success with a blended model of sponsorship ads and affiliate marketing. Jonny will be starting this himself as a test on Hack the Entrepreneur next month.
Let’s go through the pros and cons of each to see what will work for you.
- Why podcast monetization is not black or white
- The hidden benefit of using affiliate marketing on your show
- A new way to think about monetization
Plus: Hear a hidden conversation between Jonny and Jerod.
Listen, learn, enjoy …
Listen to The Showrunner below ...
The Show Notes
- If you’re ready to see for yourself why over 201,344 website owners trust StudioPress — the industry standard for premium WordPress themes and plugins — just go to StudioPress.com
- Follow Jerod on Twitter: @jerodmorris
- Follow Jonny on Twitter: @jonnastor
- Showrunner FM
No. 094 Sponsorships or Affiliate Marketing: Which Is Better for Your Podcast?
Voiceover: Rainmaker FM.
Jerod Morris: This is Rainmaker FM, the digital marketing podcast network. It’s built on the Rainmaker Platform, which empowers you to build your own digital marketing and sales platform. Start your free 14 day trial at RainmakerPlatform.com.
Welcome to The Showrunner, where we have one goal, teach you how to develop, launch, and run a remarkable show. Ready?
Welcome back to The Showrunner, the podcast for people dedicated to creating remarkable audio experiences for their audience. This is episode number 94. I am your host, Jerod Morris, VP of marketing for Rainmaker Digital. I’ll be joined momentarily, as I always am, by my nine-minutes-late-but-I-didn’t-even-notice-because-I-lost-track-of-time-making-Rainmaker-slides co-host, Jonny Nastor, the host of Hack the Entrepreneur.
The Showrunner is brought to you by the all new StudioPress Sites, a turnkey solution that combines the ease of an all-in-one website builder with the flexible power of WordPress. It’s perfect for bloggers, podcasters, and affiliate marketers, as well as those selling physical products, digital downloads, and membership programs. If you’re ready to take your WordPress site to the next level, see for yourself why over 200,000 website owners trust StudioPress. Go to Rainmaker.FM/StudioPress right now. That’s Rainmaker.FM/StudioPress.
Jonny, so glad you could make it, nine minutes late.
Jonny Nastor: You practiced that, didn’t you? You had to have, because that was impressive.
Jerod Morris: I didn’t, I just typed it down right before we started.
Jonny Nastor: It was even, like, you read it faster than I even expected it. I was like, “Wow. That’s where the other nine minutes went, was you practicing this.” Oh, it’s going well, how are you?
Jerod Morris: No. The funny part is I didn’t even notice, because I was, we both were just heads down in our work. That’s how we know that we’re having a productive workday today, because we were both so heads down in our work, we both just worked right through our calendar alert to hop on this recording.
Jonny Nastor: Yeah.
Jerod Morris: Those are good days.
Jonny Nastor: They are good days, I agree.
An Auspicious Topic for Today
Jerod Morris: I’ll tell you another reason why this is a good day. So, we’re getting ready to talk about sponsorships versus affiliate marketing, so earlier today, over on The Assembly Call, this entire sequence happened. Someone reached out to me, said, “Hey, we’re interested in sponsoring the show, will you follow us so that we can direct message you?” Got into a direct message conversation with him, put together an entire proposal for a new ad spot that we’ve never even run on the show before. Got it agreed to, and I just need to send over the invoice. All in the span of a couple of hours, literally. It’s excellent timing to be talking about this, because I’m quite enthusiastic about the topic of sponsorships right now.
Jonny Nastor: Did they approach you with a new ad spot format?
Jerod Morris: No. They basically said, “Hey, really like your show. I’m a listener, and I’d love for my company to be able to sponsor you.” It just kind of fit, because we have our other ad spots filled, but I thought, “All right, well this is an opportunity. Maybe we can do something from a pre-roll angle.” So I pitched it to him as a 30 to 45 second pre-roll ad and he loved it. So they’re going to send me copy. I’ve just got to record it, add it to the template, and obviously, it’s a nice little chunk of money, and it’s going to take me 45 minutes to an hour to set up, and then it will just be in the template. So it’s an incredible return on investment for time.
Jonny Nastor: That’s awesome.
Jerod Morris: Yeah.
Jonny Nastor: That is a great timing for this. Yeah. Let’s jump into the topic and see where it goes.
Jerod Morris: One more thing I’ll add, too, is when I put the proposal together, something I found that has worked quite well is I gave him the option of either invoicing every two week or committing for 10 weeks, and then I think I gave 15% off the total if they went 10 weeks. And immediately, replied back and said, “We’ll take the 10 weeks,” and committed. Which is nice, because now I only have to invoice once for the entire amount and get the commitment all the way through the 10 weeks and then we’ll see how it goes after that and revisit it. I have found great success doing that, when I structure my sponsorship deals.
Jonny Nastor: Yeah.
Jerod Morris: A quick tip for anybody who only wants to pop in for five minutes and then leave. But hopefully you stay, because this is going to be a good episode. Shall we?
Why Podcast Monetization is Not Black or White
Jonny Nastor: Today we’re talking podcast sponsorships versus affiliate marketing, but as you’re going to see, it’s not necessarily a versus. One of the four key elements of a remarkable podcast, as you know if you’ve been listening to the show, is monetization. We’ve talked in the past about indirect versus direct monetization, but today we’re going to talk about the pros and cons of the two types of direct podcast monetization: sponsorships and affiliate marketing. As we go through the pros and cons of each, remember it doesn’t need to be either/or.
Lots of podcasters are seeing success with sort of that blended model of sponsorships and affiliate marketing combined, and I’m actually going to be starting to test this myself on Hack the Entrepreneur next month. That’s why this kind of came up as a topic for me, because I had been exploring it on my own show where I’m going to start … I’ve been exploring it sort of, I guess, in theory, like in my head, and reading about different ways to do it, and so I’m actually going to start in practice doing it. So I thought it would be a good time to kind of talk about it here.
Jerod Morris: It’s a great topic. Should we quickly define the difference between sponsorships and affiliate marketing, just so everybody is clear what we’re talking about?
Jonny Nastor: Of course. Let’s do it.
Jerod Morris: I mean, I guess, the easiest way to explain this if you think back two or three minutes, I did that read for StudioPress, for StudioPress Sites and I said, “Go to Rainmaker.FM/StudioPress.” So, let’s say that by going to that link, if you sign up for StudioPress, we got a cut of like 100 bucks for every website, or whatever the cut would be, that would be affiliate marketing.
Jonny Nastor: Isn’t it 150?
Jerod Morris: I mean, I think we should hold out for 300, so we’ll talk to Brian about that. But, if you’re getting paid based on someone taking action and you’re getting a cut, kind of a commission of that sale that you send, that’s affiliate marketing, right? If we’re just getting paid, say $300 just to do the ad read, and it doesn’t matter if someone buys, takes action, or anything, then that’s a sponsorship, and that’s probably the quickest and easiest way. If you listen to ads, or if you listen to podcasts, you probably hear Audible podcast ads a lot.
Actually, it’s been six or seven months since I looked at a Audible’s program, but at least before it was an affiliate relationship, where when people signed up for an Audible account through your link, or your promo code that you would read, then you would get like 15 bucks, or 30 bucks, or whatever it is, they weren’t actually paying 100 bucks to be on the episode, something like that. You were getting paid when you sent a sale. That’s the basic difference between affiliate marketing and sponsorships.
Jonny Nastor: Right. Sponsors pay you to promote, like a TV commercial or a radio ad, and an affiliate is you set up a relationship with them to promote their product. They only pay you upon a sale.
Jerod Morris:That’s just a much more succinct description.
Jonny Nastor: Just because there’s only the one clarification I wanted to make. When you said sponsorships, and it doesn’t matter if anybody goes to the link or buys anything, it’s kind of wrong, because it does, because it’s a sponsorship and if they don’t ever go to a link or buy anything then you’ll never get that sponsorship again. It’s a terrible relationship.
Jerod Morris: Okay. That’s a very good distinction.
Jonny Nastor: That’s why I actually wanted to bring it up. You talked about affiliate marketing really well, but sponsorship isn’t just about getting that money first.
Jerod Morris: Yeah.
Jonny Nastor: We’re going to kind of go into that. But, those are the two types of direct monetization that happen. And think about the blended sort of model for you, especially if you’re starting out and you don’t have ads yet. I’ve said this before, I’ll say it again, affiliate ads are what you should start with right away, because you can start and it’s good to get your audience used to having those ad spots there. Plus, there’s obviously other benefits to it. But, let’s jump into affiliate marketing first and we’ll start with the pros of affiliate marketing.
The Pros of Affiliate Marketing
Jerod Morris: The pros are that it is fast, it is targeted, and it is informative. So, affiliate marketing is fast because you can implement it immediately, so you can go join Amazon’s affiliate program, or there are lots of different ones, and you can go get set up, and start doing those reads on your show right away. It’s targeted. Do you want to go through these one by one?
Jonny Nastor: Yeah.
Jerod Morris: Okay. So let’s … do you want to break down a little bit more than how it’s fast?
Jonny Nastor: That’s it, you can literally start it. And that’s why I tell people, if you are in any way thinking about monetizing your podcast at some point, which Jerod and I fully tell you you should, because it’s part of running a remarkable show, is to start with affiliate ads. Because you can start … even with, I mean, we are sponsored at this point by StudioPress Sites. You can go to, as a podcaster … if you are in a market that could use StudioPress Sites, then you could go to ShareASale.com and the affiliate program for your StudioPress Sites runs through that, you can apply through them, tell them what you are going to do with it, and probably get approved to be an affiliate for that. You don’t get a special link like we do, but you do get that, and you could get set up promoting StudioPress Sites to your audience and getting paid per sale.
Jerod Morris: Yeah.
Jonny Nastor: That can literally happen in 24 hours or less. There are some with Amazon, once your set up just with a generic Amazon affiliate account, you literally, every book you talk about, every thing that is for sale on Amazon you talk about can be linked with your Amazon link and it’s started. It’s literally right there, you don’t have to start trying to build relationships.
Jerod Morris: Yeah. It is targeted, because you can choose the product, or the set of products that you want to advertise on your show, that you want to discuss on your show, and really find a match between, not even just your audience, but also even the content of your show, so really hyper match it to the topic of that show and the audience. I’ll give you an example of this. We used to do this for The Assembly Call. We didn’t do it this year, but a couple of years ago around Christmas time.
Everybody loves the candy-striped pants, the candy-striped warm up pants that the Indiana basketball team wears, so they sell them at the Indiana store, so I have an affiliate relationship with the Indiana store, and so I got the affiliate link for the candy-striped pants, I created a redirect URL, and I did this using Rainmaker, so if you went to AssemblyCall.com/CandyStripe it would redirect you to the affiliate URL, and then when people went there and bought the candy-striped pants, we would get a 10% cut of that. So, it was highly targeted to the audience. We were able to highly target it to the actual time of year and the content because it was a pitch around Christmas:
“Hey, do you have an IU fan in your life who doesn’t have their candy-striped pants and needs to be ready for when the games are on, and they need their gear to wear, go to AssemblyCall.com/CandyStripe. Candy-stripe pants are on sale for 15% off, right now, yada, yada. Oh, by the way, we are affiliates of the IU online store, we get a 10% cut whenever you send people there and they make a purchase. Not only do you get a great gift for your husband or wife, or whoever you’re getting this for, but you’re also helping to support the show, as well. Go to AssemblyCall.com/CandyStripe and check them out, today.”
That would be kind of a way that I would say it, you get your disclaimer in there. Also, I found with affiliate marketing that it’s good to let people know that it helps you. And, then again, you’re targeting it, the specific product to the audience and even down to the content or the date, so you can really get creative and strategic with how you’re doing your affiliate marketing.
Jonny Nastor: The reason why I included targeting because you could be thinking, listening, that, well, a sponsorship would be targeted too, because somebody is not going to probably advertise car tires or something on The Showrunner. But, this is why I think sort of the blended model works really well. So I stopped in, I think it was November of last year, but I was using a company that was like an intermediary between sponsors and myself, and because I was all in on sponsorships, you kind of need to take things as they come. And you can only say no to certain things, especially when you’re dealing with a company kind of getting you the sponsorships.
There was definitely some ads that I didn’t think were targeted. And maybe there’s a crossover, like there was mattresses, and there was weird things that get too “commercially,” like too much just like television advertising to a generic audience, not specifically to yours. With affiliate marketing, you would never do that. I don’t think I would ever do that. I’m going to target companies that are 100% directly used by my audience almost exclusively because those are the people, I know them, and I would never think to get a mattress affiliate commission.
Although, they exist if that is your market, that makes sense. But that’s why I put the targeted in and why I am kind of emphasizing the blended model because if you do get stuck with that sponsorship that is not quite what you want or not quite targeted, grab yourself a targeted affiliate ad to put in its place.
Jerod Morris: Yep. Well said.
The Hidden Benefit of Using Affiliate Marketing on Your Show
Jonny Nastor: So, Informative. Informative is … this is a really sort of side benefit to the affiliate marketing in general that I feel a lot of people fail to realize and to see the benefit from. Informative means if I am building an audience around my podcast and I want to know what products or services that I could sell to my audience, it’s a lot easier for me to test different affiliate products and services to my audience, because I then directly see what sells, rather than trying to build a product and service and then test if my audience wants it.
This is sort of ninja looking into a business, seeing how it works. I know that if I advertise an affiliate product, like an information product, say on my show, and it’s priced at X amount of dollars and I put it on three shows and 200 people visit that link, and if three of them buy, there’s a strong correlation of interest there. Then, I could actually step back and think, “Okay, my audience is interested in this. What could I … how could I make this better if I made my own version?” But, it’s a ninja marketing tactic of knowing what it is your people want, rather than guessing. It’s just honestly: test out different offers, different services, different products. See what it is they want. Then use that information and build your own product or service, and cut out that sort of middleman of the affiliate merchant at that point.
Jerod Morris: I love that. I would add one more pro, also, to affiliate marketing. Obviously, your revenue is going to be much more variable, because you don’t know how many people are going to take you up on the call to action and go use your affiliate link and buy. But, I have found that payment itself is easier and more reliable because you’re typically going through Amazon, or ShareASale, or Commission Junction, or whoever it is, and the payment is all automated, everything I taken care of. I have had some issues in some of my one-to-one relationships with sponsors, or payments have been slow, or there’s been communication issues, or whatever. With affiliate marketing, you never deal with that, because everything is much more automated. That ease, to me, is a little more pro of affiliate marketing, from a payment angle.
Jonny Nastor: Yeah. As you’ll probably realize and maybe come up with your own, the pros, the cons of affiliate marketing and sponsorships in this, I have limited all of them to three. Just because I honestly think that there’s obviously, there’s probably 20 pros you can come up with for affiliate marketing. I was just trying to keep it somewhere.
Cons of Affiliate Marketing
Jonny Nastor: So, let’s go to the cons of affiliate marketing. The cons we are going with here are generic, lack of control, and not guaranteed. Some of these are kind of the opposite of the pro version of them, but you’ll see what we mean. Generic, this one is really, really, really big, to me. One of the biggest, if not the biggest way I’ve found to make sponsorships offers on my show most effective is to have one of two things. One is to have an offer that’s exclusive to my show and my listener, that people cannot get somewhere else, makes people want to take action on that URL, and the other one is to have that custom URL. So, Freshbooks.com/Hack, StudioPress.com/Hack, 99designs.com/Hack. All URLs that exist are targeted with my branding on it and make a specific offer to my audience. Those are the best.
Typically, you don’t get those when you do an affiliate campaign, unless you do an affiliate campaign and it grows, and grows and grows to be really big. Pat Flynn is an example of that, where he earns $30,000 a month in affiliate commissions from Bluehost and has for years. They have dedicated pages for him and offers at this point. But for the most part, you do not get that until you sell thousands and thousands and thousands of dollars, repeatedly, month after month. To me, that’s the biggest con.
HackTheEntrepreneur.com/StudiopressSites is not nearly as effective as StudioPress.com/Hack. To me, that is it. And if can find a way to overcome that … I know people, some people buy domains that are like, “GetThis,” or something, and use that as their call to action on their show. Something easy, something that really sort of drives home that relationship is really good, and so there are ways around it, but obviously the best way is with the sponsorship and having that unique URL.
Jerod Morris: Yep. I agree with you, completely. I mean, certainly doing a redirect URL at your own domain is better than having to say, “Hey go to the show notes and do this,” because it gives someone-
Jonny Nastor: They’ll never do it.
Jerod Morris: Yeah. It gives something that they can do immediately, but there is no question that having it at the actual merchant domain with your own branded URL and page is by far the best way to do it. So that’s good. The second con, for affiliate marketing, as we keep going here, is lack of control.
Because the thing is these merchants that you’re working with, and you’re not really working with them directly, you are just working with them indirectly, because they’ve put their affiliate offers up there, well, they can stop or change the offer at any time. So if you’ve built your entire revenue model, your entire affiliate marketing campaign on a certain offer, or you chose this merchant because they were offering you a 10% commission, and then they change it to 5%, or they were giving X discount and then they take that away.
You know, whatever it may be, if they change that, well, now you’re going to be scrambling and that’s not always a good position to be in. It’s not one to get overly scared about, because typically if an offer is good, it will stick and you can always go and check, “How long have they been around?” If you’re really getting serious about it, most of the companies that do affiliate marketing have kind of an affiliate marketing manager, an affiliate liaison that you can talk to, ask questions of, and I would recommend doing that for affiliates that you’re going to get serious with. But even when you do that, you’re still not the one in control, and that adds some risk to it, for you.
Jonny Nastor: I like being in control, so that’s why I put it. The final con is, it’s not guaranteed. So, you only get paid per sale. There’s other forms of affiliate marketing. There’s cost per acquisition, there’s all kind of things like where people will pay you for different things, but we’re talking typically about you make a sale and you get a 20, a 30, a 50% cut of that sale. In one way, it’s a con, because it doesn’t give you sort of that consistent steady income, but the other side, it really does truly show you what works, what call to actions are working.
That’s why affiliate marketing, to me, is so good to start off when you’re really just starting and trying to get comfortable with this, because you’ll be able to test what and how call to actions work on your show, and how to make them more effective, because you’ll directly be able to see. You’ll get that email that there’s a sale, and you can be like, “Oh, that’s interesting.” And you can continue to build off of that into the future.
Jerod Morris: So, the pros for affiliate marketing, to recap: it’s fast, it’s targeted, it’s informative. And the cons are: generic, lack of control, and non-guaranteed. Shall we talk about sponsorships?
Jonny Nastor: Yeah. Let’s move to sponsorships.
Jerod Morris: But, first, haha, let’s talk about StudioPress Sites. That’s good timing, right? Because they are the sponsor of The Showrunner. The Showrunner is brought to you buy StudioPress Sites, and as I mentioned before StudioPress Sites is a turnkey solution that combines the ease of an all-in-one website builder with the flexible power of WordPress.
You are obviously listening to The Showrunner. You have either started a podcast, you’ve been running one for a while, or thinking about doing it, and to do that well, to do it the right way, certainly to do it the Showrunner way, and to create a great audience experience, you need a website for people to go to, and a website for people to subscribe at, and to get your show notes, and possibly do other things like free courses, and the different things you can do with a powerful website. And that’s what StudioPress Sites enables you to do.
That’s why I recommend that you go and check them out. So it’s Rainmaker.FM/StudioPress. When you go there, you will see the two different options, and you can see the descriptions of them, see which one fits best for you. One will definitely fit better if you are just starting out, and one will definitely be the clear choice if you’ve been around for a while, and are looking to get a little bit more sophisticated with what you are doing. We urge you, at the end of this episode, go to Rainmaker.FM/StudioPress. Check out those options, see which one works for you today, and see how you can add the power of StudioPress to what you’re doing as a Showrunner.
And speaking of sponsors, let’s talk about sponsorship.
Pros of Sponsorship
Jonny Nastor: The pros of sponsorships: guaranteed payment, legitimacy, and exposure. So, we start with guaranteed payment, which is the exact thing we ended with on the cons of affiliates. Guaranteed payment. It’s guaranteed because if you’re like me and like Jerod talked about at the beginning, is getting paid before the ads even run. I do not run an ad on my show without getting paid first. I kind of create the urgency by … people typically want to know what dates they can run, when can their sponsorships start. And I’ll tell them the dates, but I will say this is totally based on when I receive payment from you.
Nothing goes on the calendar, on the schedule, until I get payment. That creates an urgency. It makes people pay you really quickly. Then you worry about the copy and do it. It guarantees payment right away. It’s your job to create that relationship and make sure that you are getting the return on investment for your sponsor, so they want to keep coming back. But for you, right now, you know you are gonna be paid, and how much you are going to be paid for each episode going forward.
Jerod Morris: Yep. The second pro is legitimacy, and this is a really interesting one, Jonny, because obviously, if you have ads on your show your listeners are going to view you as a more professional show, because we are used to with the big time shows that are out there, they’re highly produced and we just come to expect ads on those shows. That’s how 95% of shows do it. If you have a really popular show like Sam Harris, sometimes you don’t have ads and sometimes you chose to go full donation model, but most shows that are really popular, really well produced do have ads, and so there is an element of legitimacy and even to a certain extent some authority that will be conveyed on you when you have ads running.
Now, there’s a balance there. You can’t just run 16 ads before your episode, before you even get to the content, because that’s going to annoy people. It’s kind of interesting, I had someone mention, he was an older guy, who had been listening to The Assembly Call for the first time, this year, and obviously we have a few ads at the beginning of that, and even when I introduce my co-host, I mention other sites that they write for just as a way to promote their work. But if you don’t know that those are the sites that they work for, it can sound like an ad. And he told me that he liked the show, but it was kind of NASCAR-ish at the beginning, with all the ads, which was really interesting feedback.
It is something to keep in mind, that you’ve got to make sure that you don’t make your show too cluttered and that you drown out your content with ads, but if they are done tastefully, and if you just have them in the normal places and you don’t over do it, I think, in 98.6% of cases, you are going to add legitimacy to your show instead of annoy people, which I know is sometimes the fear when we put ads on our show. But, I would highly recommend that you not be too afraid about that, because listeners who really value your content and value you as a showrunner are not going to be upset that you’re running ads on your show.
Jonny Nastor: To be clear, 16 ads running at the beginning does not make you 16 times more legitimate in your listeners’ eyes?
Jerod Morris: No.
Jonny Nastor: The last pro of sponsorships is exposure. This one was one that I didn’t actually … I wouldn’t have thought of until dealing with sponsors for so long. Sponsors almost always, there’s going to be some exceptions, but they like to share episodes of shows that they’ve sponsored, and when you start dealing with bigger companies, they’re already targeted to your audience, they have quite large followings and this can actually cause some real spikes and differences in listenership, which is really, really cool, to me.
It’s one of the reason why I like to really focus on getting that relationship, like really focusing on a relationship as a sponsorship, or a sponsorship as a relationship, because they are mutually beneficial in all and every way, at least when they are executed properly. One of the ways that gets further benefit to you as not just the money, but having this exposure to their audience. It’s beneficial to them, plus to you, and this wasn’t something that I was expecting when I got into sponsorships, but it’s definitely, definitely something you’ll never get from an affiliate relationship.
Jerod Morris: No. There’s no question. I want to linger on something that you said for just a moment, and it’s the idea of relationships, because one of the biggest lessons that I’ve learned from you and the time that we’ve been hosting this show together is about the importance of viewing sponsorships as partnerships, and I think that it’s another pro of sponsorships, the relationships that you can develop, and the relationships that open up when you have a really good partnership with your sponsor.
In fact, the very first thing that I said to the guy who reached out to me today, about sponsoring, is I said, “The way that we view all sponsorships is we view them as a three way partnership between us, the sponsor, and the audience.” Meaning, obviously, we get something out of it with the revenue, we want to make sure that you get something out of it, in terms of getting a return on your investment, and we want to make sure that our audience gets something out of it, and then kind of asked him, kind of what you had said earlier about getting some sort of special offer, something exclusive.
It really changes the game when you do this. All the sponsors that we’ve had on The Assembly Call, for example, all want to renew, want that relationship to continue, and have had good experiences and I attribute it, absolutely, 100%, Jonny, to that lesson from you of treating it like a partnership. And really, as soon as they become a sponsor of the show, treating their success, and helping them achieve success, as my own success. Because, it really is, for the long term, if you want to keep them as a sponsor.
So that doesn’t necessarily fit into a pro or a con, but I do think it’s an important point to underline, highlight, and bold, because I think it’s the single most important thing to working effectively with sponsors, and keeping sponsors for the long term is that … viewing them as partners. It’s so important.
Cons of Sponsorships
Jonny Nastor: Absolutely. I absolutely agree and it segues us into cons, because that is kind of included in here, but you’ll see. For cons of sponsorships, I have time intensive, middle man, and endorsement requests. So, time intensive, this plays totally to what Jerod just said. It’s time intensive because, like all relationships, sponsorship relationships take time and effort to maintain. From invoicing to working out ad copy, all of these things take time. When I say that it’s a con, I don’t say that it’s a con as in it outweighs all the benefits of relationships with sponsors, it absolutely does not. But, it’s something to take into account.
If you’re already stretched out completely on the amount of time you can dedicate to your show, then adding something that’s going to take another hour or two hours a week is probably not a smart move. You should be focusing on your content, maybe not even thinking about sponsorships, because an affiliate relationship is not really a relationship. It’s literally getting a link and getting paid when that link goes out, so you don’t have to maintain that. It’s easier for you right now.
Hopefully, if you can successfully use affiliate marketing to start earning some revenue and income on your show, then that will hopefully buy you some more time to focus on your show That time then should absolutely be used to build those relationships. But, for right now I’m going to call it a con, because it really is time intensive.
Jerod Morris: Yeah. The next con is middle men. Lots of bigger companies only buy ads through ad networks. Jonny, you will be better to speak about that one than I am, because you have actually used ad networks. All the sponsorships that I have done have been one to one relationships, so even SeatGeek who is a really big company, and they sponsor tons and tons of podcasts, that was still, you know, a one on one. They reached out to me, we had conversations, there wasn’t a middle man, I was going direct to them. One of our big sponsors, Hoosier Proud, I reached out to them, because I thought it was a really good brand fit, the one that reached out to me today, so all of those are individual relationships.
It does add to the time intensity of it, but I love being able to deal with those people one on one, to really understand what their goals are, to make sure that we’re delivering exactly what they want, and vice versa, to make sure that I can explain to them the value proposition and so that pricing isn’t just based on what they price a podcast, generally, but it’s based on specifically what me and my audience bring to them. Because, I know I will put more time in and my audience will be more responsive than a normal audience.
I love being able to go one on one and make that case to them, where if there was a middle man, and again, I haven’t had that experience, but I can’t imagine that I would be able to have that same impact and be as persuasive about why they should work with us as I am. Maybe you could speak a little bit about middle men, but I can definitely see this as a con if I had to do it that way, because it would feel unnatural, and because I know how much success I’ve had being able to go one to one with sponsors so far.
Jonny Nastor: Right. It’s a con to me for those reasons you’ve said, but it’s also sort of a forward thinking con, and I don’t know how it’s going to sort of play out. But, I have a feeling that it’s going to get maybe more middle men oriented. As podcasts and podcast sponsorships grow, more and more bigger companies are going to want to come and sponsor, but they don’t want to have people or teams dedicated to finding places and keep those relationships going. They can just outsource it to another company. To me, that’s hard, because you’d never get that relationship. I hope it doesn’t go that way, but to me that’s a con, because there are certain companies right now that I can’t deal with, because they only go through certain companies, and I fear it might even go further that direction.
Jerod Morris: Yeah.
Jonny Nastor: But, that might or might not happen.
Jerod Morris: But, don’t feel like you can only can work with companies who make you go through middle men who are big. You can reach out to individual companies, and people are responsive to the power of podcasting now. If you can begin a relationship, strike up a conversation, and articulate your value proposition well, you can get that relationship. I did not think that was possible until I started doing it myself, and I’m so glad I did. So, just remember that, and be bold.
Jonny Nastor: Mostly that’s just a personal con, because I was tired of working with middle men.
Jerod Morris: Yeah. I can see why.
Jonny Nastor: I’ll just leave it at that.
Jerod Morris: I can see why.
Jonny Nastor: All right. The final con we are going to stick with today is endorsement requests. I actually ran into this a lot when I was using a middle man, and now it’s very clear in my contract, and this doesn’t happen. Endorsement requests are … so, there’s a difference between a sponsor and an endorsement. Right? But, sponsors often, especially because they’re bigger companies, and maybe that ad network might have promised endorsements from everyone, but sponsor will want them to endorse their product, not just talk about its benefits. And to me, that’s crossing a line that I don’t want to cross. I will fully 100% endorse any product, book, service, that I truly do use, enjoy, and see a benefit from. Absolutely.
It’s a reason why I carefully choose my sponsorship relationships, so that I can endorse, in certain cases, those things. But, there’s nothing worse than being … trying to be told, or forced into showing an endorsement and having people turn down ads, because you’re not fully endorsing a product that you’ve never used. I think it’s a terrible line. I love the way Jerod said, it’s like a three way relationship between the sponsor, the show, and the audience. I think you’re totally lying and confusing and, I think, building distrust in your audience if you start endorsing things that you don’t actually endorse. This one is a huge con to me and a very big reason to why I would say no to a sponsorship and immediately fill that spot with an affiliate ad if that’s all I had at the time.
Why it’s Important to Believe in Your Endorsements
Jerod Morris: Yep. It is so important to remember that … what are we trying to do when we build an audience? We’re building trust, right? We’re building credibility. We want our audience to trust us. Not just that we know what we’re talking about, but that they can really believe that the recommendations that we are giving them are genuine. I’ll tell you this, because I’ve had this from personal experience.
When you have a sponsor and if you give any level of endorsement, and for example with SeatGeek, you know, I’m happy to endorse them on the show in addition to the sponsorship, because I’ve used them, they are legitimately the ticket site that I will use when I’m going to look for tickets. They offer a rebate to our listeners of $20 on their first purchase. I went through and did that myself to make sure that it worked, because I wasn’t going to recommend it if it didn’t.
All those things work, but earlier this year I had an audience member who had an issue with SeatGeek. I mean, they’re a big company there are going to be issues every now and then. They bought some tickets, then the tickets weren’t there, but they had already bought plane tickets to go to this event, but they didn’t have tickets, and it was a big fiasco, and they were trying to get it all figured out with support, and when they kind of reached a bit of a standstill and couldn’t get any further, they emailed me, and asked me, “We went to SeatGeek based on your recommendation, all of these things happened.”
They weren’t necessarily blaming me, but it was kind of a last resort for them to see if there was anything that could be done. In a sense, even though the weren’t saying, “We blame you,” it was clear that there was some responsibility conferred onto me for this issue that they were going through. Now, I went and reached out to my contacts and everything ended up being taken care of okay, and satisfactorily, so all is well that ends well. But, it was an eyeopening experience for me that, hey, you better take these recommendations seriously, because at the end of the day if something goes wrong or isn’t as you say, there is some responsibility on you, on me, as the showrunner.
I take that seriously, and even more seriously now, after that experience, and that’s not to scare you, or say, “Oh, my God, don’t do sponsorships,” or anything like that. But, just make sure that you have personal experience, so you are not vouching for something that you’re totally in the dark about, because we know not every company is going to be exactly like what’s in their ad copy. Right? So, you want to make sure that you’ve used them, and that you really, really believe in them before you recommend them to your audience.
Jonny Nastor: Well said.
Jerod Morris: That was scary, by the way, when I got that email.
Jonny Nastor: Yeah. I would think so, but it’s cool.
Jerod Morris: But it worked well.
Jonny Nastor: Okay, to wrap up. Affiliate marketing pros: fast, targeted, and informative. The cons are that it’s generic, you have lack of control, and it’s not guaranteed. Then, with sponsorships, the pros are guaranteed payment, legitimacy, and exposure. The cons are that it’s time intensive, there’s middle men sometimes involved, and you get these weird endorsement requests that are hard to say no to, sometimes.
Jerod Morris: Can we-
Jonny Nastor: So-
Jerod Morris: I was going to ask you one thing, because you mentioned earlier about blending affiliate marketing and sponsorships. Do you want to explore that any more? Are you talking about a strategy where you do both affiliate marketing and sponsorships, or even blending an affiliate relationship and a sponsorship into the same thing?
Jonny Nastor: Oh, no, no, no, no, no. Don’t do that.
Jerod Morris: Okay.
Jonny Nastor: That’s just confusing. Good question. I mean, you have a certain cost you want to charge for episodes, and a certain criteria for sponsors that you want to take on, for all of your episodes. I have three episodes a week. So if I can fulfill both of those criteria on two episodes a week, but I cannot on the third day, rather than overlooking one of my criteria, and getting a sponsor that I don’t think is a good relationship, but just filling it to get the money, I won’t do that. I’ll fill that episode with an affiliate product or affiliate offer that I think is equally as good.
A Hidden Conversation Between Jonny and Jerod
Jerod Morris: Can I ask your advice on something? Real quick.
Jonny Nastor: Of course.
Jerod Morris: We have this relationship with Hoosier Proud. They’re a t-shirt company, and they sponsor our banner moment section of The Assembly Call, so it’s the Hoosier Proud banner moment, so we do a read for them on all of the podcasts. And also a part of our sponsorship last year was emails. So we did emails to the audience for specific products, and we set it up basically as a blending of affiliate marketing and sponsorships in a sense, because they paid X amount for the ad reads, and then we also got … now, when we did it last time, they do our Assembly Call t-shirts, so we got a cut of the actual t-shirt sales that we had.
This year we are going to get a little bit, or for next season, we’re going to get a little bit more sophisticated with it and actually have a promotion calendar, and promote individual items, because we found that even when we did that on the podcast there was a greater likelihood, a greater enthusiasm for taking action, than just a straight regular branding read. So, my question to you is, do I simply try to structure this as a one lump sum payment for all of this, or do I try to set myself up to take part in the upside, if our audience really grows, and if people take advantage of the calls to action, maybe more than we can project, and have kind of an affiliate relationship there, so that for every t-shirt we help sell in addition to the lump sum we also get an affiliate cut? Because that’s what I’m leaning toward, mainly because I saw it work with them last year, but your reaction that you had when I mentioned that makes me think that maybe you think that’s a bad idea, and I’m curious.
Jonny Nastor: Are you only selling your shirts, or is it IU shirts?
Jerod Morris: No. They have an entire product line of shirts basically celebrating the state of Indiana. Now, they also do our shirts as part of that, but they’re two kind of different product lines, but we advertise for their entire product line. What we sell … for instance, “Hey, this week’s t-shirt of the week is the state of Indiana outline t-shirt. Go get it now, you’ll save 15%.” And then maybe we get a $5.00 cut for that week when people buy that t-shirt. That would be how that would work.
Jonny Nastor: So then, if that’s the case, and you were thinking that you wanted to eventually maybe get into shirts, then I would look at the pro of affiliates, pro number three, informative. Learning specifically what your audience wants. When you do just a sponsorship, you’ll get that custom URL and that branded URL, but you’re not going to know exactly how many people kind of click through it and specifically buy.
If you have an affiliate commission with them as well, you will have that information, and if you see certain types of shirts or products that are selling really well, you could then in turn, as I said, now that you’ve done your market research, and you know that your audience loves these type of coffee mugs, and these types of sweatshirts, you could possibly create your own in the next promotion cycle, and then cut out the whole affiliate thing all together, and just have your own sort of branding line.
Jerod Morris: That’s interesting. I had never have thought about it from that angle.
Jonny Nastor: I’m not saying that’s what you want to do, but I’m saying if that’s what you want to do, then I would take the small bit of affiliate just so you can have that data.
Jerod Morris: Yeah.
Jonny Nastor: On how it works.
Jerod Morris: What if-
Jonny Nastor: Use it as being informative.
Jerod Morris: That’s a great idea. That actually opens it up to something I hadn’t thought of before. But, what if I was thinking about it more, as a way again, to maximize my potential upside, but at the same time make sure there’s almost a guarantee that this going to work for them, because they would obviously pay a little bit more, or a little bit less upfront, but then they’d be paying us based on how many shirts are sold.
So, if we end up making a lot of money, they’re going to, because obviously we’re not going to be making a lot of money from the affiliate part of the relationship if they’re not selling a lot of t-shirts. I suppose I was trying to structure it so that it really balanced it out for both of us, and allowed us both to really take part in the upside, if the audience grows a lot, which I think it will.
Jonny Nastor: I think, that as a strict sponsorship deal that you as the podcaster still benefit on the upside, if there’s a big upside, because this company will never leave you as a sponsor, first of all.
Jerod Morris: Yeah.
Jonny Nastor: The way they’ll come back to you is you’ll actually probably be able to … I mean, if your audience grows and they already want to come back you can say that the cost has gone up, and they will say yes, or else they’ll come back and say, “But we only earned X amount so we could actually, the most we can pay is this.” And you know.
Jerod Morris: Yeah.
Jonny Nastor: You know what I mean?
Jerod Morris: True.
Jonny Nastor: I know it’s about maximizing it, but you can only maximize it to a point where they don’t get a return on investment anymore. Then you lose the relationship.
Jerod Morris: Yeah. I agree with that. Okay.
Jonny Nastor: To me, it’s almost, it doesn’t need to be so confusing.
Jerod Morris: Just keep it simple.
Jonny Nastor: If it really, really does work well for them, this first time, that’s awesome, that’s super good. You should hope that they make a million dollars and they only pay you 10,000, this first time, because they will never, ever, ever leave you.
Jerod Morris: Yeah.
Jonny Nastor: They will offer you so much the next time to do this again, they really truly will, because it’s a source of really targeted traffic. That’s your value, and that value will then be them buying it 10 more times in a row. You never have to go look for somebody else, that you get this strong relationship and it’s me and FreshBooks, it’s two and a half years.
Jerod Morris: Yeah.
Jonny Nastor: To me, I can always think, it’s like, “I wonder if I could have got $50 more each time from them,” but it’s not worth it to me.
Jerod Morris: Yeah.
Jonny Nastor: I like having that bond. I like that it’s been years. I like that we, I mean, to me that’s worthwhile. It’s mutually beneficial, which is what it has to be.
Jerod Morris: I’m glad I asked you that. That’s good, man. You’ve never led me astray when it’s come to sponsorship and just strategies and advice. I appreciate your candor.
Jonny Nastor: Don’t under sell yourself, but also make sure they make money.
Jerod Morris: Yeah. I figured I was going to ask you this question when we stopped recording, anyway, so why not have the conversation right here live on the air? Cool. Thanks, man.
Jonny Nastor: That was fun. No problem.
Jerod Morris: Okay. We need to tell you about going to Showrunner.FM/Report and why you want to do this, and the reason why you want to go to Showrunner.FM/Report is so that you can get your free nine step beginners guide to launching a podcast, today. You’re going to learn how to define your audience, and want to pick your format. You’re going to learn the six paths to podcast monetization. You will learn the exact equipment that we use to run our podcasts, and more. It is a simple no frills nine step plan to get your podcast off the ground.
If you have been running a show for a little while, there are going to be some nuggets in there for you, too, that maybe you didn’t think about when you started, or a good reminders, so it can really help you out in many different stages of your show running career. So, go to Showrunner.FM/Report. All you have to do is enter your email address, and not only will you get that report, but you will get a very informative and helpful kind of email course, email series, once you sign up. Hopefully you will do that, Showrunner.FM/Report. With that, we bid you adieu, and say we look forward to speaking with you next week on another brand new episode of The Showrunner.
Jonny Nastor: Take care.