Perspective from Ben Thompson on the future of podcasting and monetization.

A major challenge in podcast monetization is the complete lack of data: listeners still download MP3s and that’s the end of it; podcasters can measure downloads, but have no idea if the episode is actually listened to, for how long, or whether or not the ads are skipped. In a complete reversal from the online world of text, the measurement system is a big step backwards from what came before: both radio and TV have an established measurement system for what shows are watched, and the scale of advertising is such that surveys can measure advertising effectiveness. Thus the direct marketing advertisers: they can simply do the measurement themselves through coupon codes or special URLs that measure how many people responded to a podcast ad. It’s not totally efficient – some number of conversions forget the code or URL – but it’s something.

It also won’t scale. For the advertisers that exist the implication of measuring by code or URL is that every single podcast needs customized support, limiting advertising opportunities to bigger podcasts only. More importantly, there simply aren’t that many advertisers with the sort of business model that can justify the hassle. The real money in TV and especially radio is brand advertising; brand advertising is focused on building affinity for a purchase that will happen at some indefinite point in the future, so the focus is less on conversion and more on targeting: knowing in broad strokes who is listening to an ad, and exactly how many people. For podcasting to ever be a true moneymaker it has to tap into that – and that means changing the fundamental nature of the product.