On the Thursday, August 17, 2023 episode of the Accidental Tech Podcast (#548: Starting to Count Chickens), the hosts (Marco, John, & Casey) discussed their current sponsorship situation and the importance of membership.
Listen to the chapter audio 👉 Our ad market at 1:45:36 or read the full transcript below
Feedback from listeners on the episode, it's interesting to note the difference in responses between Mastodon (less anonymous) and Reddit (more anonymous).
Full (automated) transcript of the chapter:
Marco: So that's an unusual outro for the show. Because this week, we were exclusively member supported. And this is not the first time this has happened, but it's certainly not a common thing, and it's becoming more common. And that's because our ad sales have been in the toilet recently. And there's a bunch of kind of bigger picture moves in the industry and the economy that are causing this.
Marco: We wanted to discuss it here just because, okay, look. Let me let's start by saying, We're fine. The show is fine. No one's in trouble. Not even you, Alex.
Marco: No one's in trouble. Everything's fine. So anyway, What what I've seen in not only our show, but in the podcast landscape in general, including things like overcast podcast ads that that, like, those little banners that that support a little a large part of overcast business. Something happened around January. And, you know, there's obviously been some economic changes in in the, you know, the the larger landscape.
Marco: But Linode January, ad sales and ad prices have dropped significantly, to to to the point where, like, we I I've never seen a drop this Linode we since I've been selling these kinds of ads either either since we've been selling them for this show or or the the ads in overcast. Like, it's on the order of, like, fifty percent lower prices this year and, you know, fewer sponsors, fewer buys, and lower prices. So it's been a tough environment to try to sell ads in. And for podcasts like ours, there's been a lot of factors for that. You know, the industry the kind of ad that we do.
Marco: It's it's called a host read, which means I read it. And they're baked in, which means that I record them and I stick them in the show and everyone gets the same copy of the show with the same ads in it. And it also means that no matter how many downloads that show gets, those ads are gonna get that number of impressions, which might be higher or lower than the advertiser might have might want. And and over time, those ads aren't changed. Like, you know, so if you go back and listen to an episode from five years ago, you're gonna hear the ad that was in there five years ago, not like a new ad.
Marco: So that's how that's the kind of show that we do and the kind of show that we've always done. That's not where the industry has moved largely. The the industry has largely moved towards, first of all, dynamic ad insertion. When you download a podcast and every download might have different ads spliced into it at download time. Now, sometimes this is for somewhat innocuous reasons.
Marco: Like, you know, if you wanna have the same ad spot, you know, included in four or five different episodes, you can do that. If you wanna put new ads into new downloads of old Linode, like if if you get a lot of back catalog traffic for your show, might wanna monetize your back catalog a little bit better and, you know, and sell ads that will run-in back catalog episodes so they get spliced in that way. But it's also often used in really annoying or creepy or both ways. So for instance, because dynamically add dynamic ad insertion can check your IP address upon serving it to you. It can then do various targeting things based on tracking and other behavior information that they can derive from you either themselves or through other services that they're sharing all your crap with and tracking you across.
Marco: And it's really super creepy, and that's why you can get, like, personally targeted ads in Dynamic Ad Insert or DAI. You you can get those injected in your show, or they can use your IP address to perform rough geolocation and figure out roughly what region you're in. And for instance, serve you a an ad for a local car dealership, like a radio ad, like, stuck in your podcasts. Listeners hate this. Like, it's it's awful for listeners.
Marco: As you know, if you listen to any shows that do this, and most large podcast publishers are now doing this to the style of ad. For us, you know, first first the ad market for shows like ours first got abstracted away from us by ad agencies. You know, when we first started the show, we were largely being contacted by sponsors directly or we were contacting them directly, and we would talk to, you know, their ad person or whatever, and they would buy it, and that'd be it. Over the years that have shifted more and more towards, we have to deal with agencies and the agencies deal with the sponsors. And there's pluses and minuses to that, but it's I think it's proven to be mostly a minus.
Marco: Now we're even moving away from that into these dynamic ad insertion worlds, and when you have people when people are buying dynamic ads, largely, they're not saying, you know, give me episode five forty six of ATP. What they're saying instead because they have access to not only dynamic insertion, but also they have access to some kind of demographic targeting usually What they're able to say instead is they're able to go to a large ad exchange or or platform and say, alright. I wanna buy a hundred thousand impressions at this CPM or lower, this cost per thousand or lower of men, eggs, twenty five to thirty four in the US you know, like, they're able to target it to that level. That's not the kind of ad that we sell. And frankly, that's not the kind of ad that we want to sell.
Marco: We don't want to track you or to get your information like that, or critically, we don't want to enable anyone else to track you in that way. We don't wanna make a show full of dynamic ads ad insertion because listeners hate it. Like, and and again, you're all podcast listeners you probably listen to at least one show at DAI and you probably hate it. We also don't wanna join some kind of big ad marketplace, you know, for lots of reasons, chiefly, of which we probably make a lot less money and part of that is because they will, you know, add marketplaces take their own cut and it's usually huge. And they all take away control from us.
Marco: And that would give us us control over things like we don't wanna track people and be creepy and stuff like that. We also don't wanna join a big podcast network. And it it honestly would have to be a big network, to make a difference here because the small networks are having many of these similar issues. But, you know, we don't wanna join our pockets network because, like, we are our own show. Like, we, we don't wanna share our branding.
Marco: We don't wanna have some network you know, badge on our artwork and and have ATP just be another show brought to you by Big Network X. Like, that's not our style. That's not our show. Meanwhile, you know, in in twenty twenty, we launched this membership program. And membership started out as a nice kind of side bonus Linode, kinda like when we sell merchandise, you know, when we sell t shirts and stuff, that makes, you know, decent side income.
Marco: It was nowhere near the main income of the show. But it's decent side income. Membership started that way, but membership is growing. And it's it's been going really well. And we really so much appreciate that.
Marco: And and we wanted to all you know, we wanted to say first of all, how much we appreciate that? Because right now, as you've heard, like, the number of sponsorships on our shows has has gone dramatically down since the beginning of the year. And if you look at previous years, like the the amount of times that we had less than a totally full ad load, like less than all three ads before twenty twenty three, it almost never happened. And now in twenty twenty three, I think it's more unusual when we have a full three ads than than not. And meanwhile, membership is is going great.
Marco: So we want to just kinda brainstorm in public, like, you know, Where kind of what directions we might wanna take the show? Because the landscape is is has so radically changed in the last, you know, six, seven months. To the point where the ad business is really it has become something that not only is it not working nearly as well for us as it used to. But the direction that the podcast ads have gone has gone in a direction that we don't really wanna go. You know, right when we when we first launched the membership program.
Marco: What we said, and and and this is still the goal was we don't wanna take anything away from the show. We wanna only be additive, you know. So members will get things that were never given to everyone else for free. It was, you know, extra content here and there. You know, extra perks, like, you know, side stuff.
Marco: And I think now I think where we are now is I don't think the show is ever gonna go, like, you know, behind totally behind a paywall because none of us want that. But You know, at some point, because the landscape is now very different, I have argued, you know, we don't all agree on everything here, but But I have argued, I think we should put more behind the member paywall if we're gonna be a more member supported show. And what everyone else does is, like, their their after show, their or their pre show. Like, every that's what like, if you look around the landscape of other podcasts that have member programs kind of in in the same, you know, extended universes our show. That's a pretty common thing.
Marco: A lot of relay shows do it. You know, like, a there's a lot a lot of shows that do that. And we kind of wanted to, you know, discuss this, you know, with you, the listeners. I know you're not, like, here in the room with us, but but kinda just get some feedback. Like, I can see a future in which we might go all membership and have no ads and then and just put, like, you know, the after show and maybe chapter markers or something, you know, some combination of, like, you know, most of the show would still be free and we would have on a regular basis promos for membership in the show the same way we have sponsorship breaks now.
Marco: We would have like, you know, a member promo or two or three in every episode. And then the, maybe, the after show becomes member only and chapters or, you know, something else. So whatever we come up with plus stuff we do now.
John: You did so well before telling everybody they weren't in trouble. I think you did another disclaimer now. We are not announcing anything. We're not changing anything. Discussing it because and the reason by the way, the reason we're discussing it, like Marco alluded to this, but to to be more concrete.
John: So, yeah, the ads are super duper down this year. Right? But we're not thinking of doing anything right this second. But, for example, if next year has a similar degree to this year. Like, if the ads just go away, like, not by our choice, but, like, hey, guess what?
John: No one wants to buy these kinds of ads anymore. They only wanna buy the candidate of ads that you don't wanna have on your show. And by the way, even before dynamic ad insertion and everything, We were already kind of at a step with the market in that where we have hundred percent control over what ads we run, and we're picky. We will, you know, reject ads from companies that we don't want to have ads on the show. We have always done that.
John: We continue to do that. Even though we don't have enough advertisers to fill the slots, they still get the same thumbs down. We will remove advertisers that we thought were good but turned out not to be. That is not something that happens in a marketplace where people like, oh, I just want these ads. Everything is a commodity.
John: I don't care what shows they run on blah blah blah. It's just, you know, we've always been out of step with that. So anyway, If we continue down this road and it's like next year and the year after the ads just disappear, we need to think about how can we support the show. So that's why we're musing about this. First a, that's not why we're making any we're not making any changes right now about this, but we have to start thinking about it because thinking ahead is an important part of running a business.
John: You don't think about this after the ads go entirely. You think about it when you could see a possibility that they might go away or dwindle to a point where they're no longer worth having it at all. And then you have to think about what can we do to, you know, How can we how can we get some of that back? And so this year, membership, which used to be, so, you know, in all previous ten, whatever years of the program, advertising is how we made the vast majority of our income. And then membership came along, and advertising was still the way we made the vast majority of our income.
John: Suddenly, this here. Membership, it's flipped. Membership has become the way we I think it's edged out as. And not because membership has grown that much, although membership has grown, and we thank you a lot for the ads have gone way way down, which is not the way you wanna see things go. Like, if if if your income's gonna flip from like it used to be, you know, mostly it was this and then this was a little pool on the side.
John: If it flips, fine. But if it flips because the thing that used to be big becomes really, really small, that's not great. So we're staring at this and saying, What do we happen if that what happens if that ad number which used to be the majority of your income? Like, think about this with your own income. If the way you make the majority of your money went down by half, you'd be thinking about stuff.
John: You'd be thinking about what, you know, what can we what can we do about this? What can we change going forward? So we are definitely thinking about things. And it's tricky. Like, we if you think about it, I'm sure people will send us feedback or whatever, but, like, part of what you're buying is part of membership.
John: Is you get an ad free version of the show. But if the show is already ad free, that makes them less valuable because everybody gets an ad free version of the show. Why would you pay extra for it? You just don't have to be a member or you can get the algorithm to show. You know, we also sell the bootleg.
John: You get a merch discount. You get the other member specials. There's also some stuff like that. That's why market was musing about, okay, in a world where there are no ads. How do we essentially shore up the value of membership?
John: Because if we just got rid of the ads, we think membership would go down. Because people would say, oh, it was being a member because I didn't wanna hear the stupid ads. Now the ads are gone. Now, also membership gets cut in half, and it's pretty soon. It's pretty soon our income just goes down down it.
John: You know, so you can see why we're thinking about this. Yep. My idea, which we may or may not do, we haven't discussed it yet. Is, you know, I sent out that survey about, what was what was the survey about originally? I forget.
Casey: Well, it was about tech versus non tech stuff. Right?
John: Oh, yeah. That's right. We did a survey about the member special because we wanted to hear if we were doing the right things with the member special. And that was incredibly valuable. We found out that that We our mix of tech versus non tech was incorrect, but also that it was kind of about in the middle and it wasn't that, you know, anyway.
John: It was really valuable. It's like a three question survey or whatever. So probably, at some point, I would like to send out another survey that asks people's opinions about membership. Now, this is tricky because you can ask people what they're gonna do. Like, if we did x, how would you feel about it?
John: How do you feel about members right now? And people will give their opinions? But people's own predictions about their future behavior is not always accurate. That's just part of the world of surveys. So we'll have to think about whether that's worth doing or if, you know, if we're gonna do it at all or how we're gonna do it.
John: Basically, you, the listeners have always been the most important customer. That's part of our value to advertisers is you, our listeners, because we think our listeners are more valuable than the average listener, which is why we get pretty good ad rates because the people who listen to the show who are interested in technology are are not the same as just random people who are flipping through a bunch of podcasts on Spotify. Like, our audience is valuable. And No. We're not going to give you all their demographic information and, you know, give you their IP addresses so you can figure out where they live or whatever.
John: But we know for a fact that they are valuable because advertisers get value out of them. Because, you know, people with services that appeal to this audience, we can characterize the audience where by the kind of show we are. So the audience of this show is where all the value is. And so that's why we're very interested in what the audience of this show thinks about the value proposition of membership of the current ad thing of things that they would find attractive going forward and things they would find not attractive going forward. So we are definitely musing about this, but as you can see if you think about it, it's not an easy problem.
John: There's no sort of like, just do this and you'll be fine. None of those exist. So we are thinking about it. We'd love to hear your feedback from it, about this issue. And maybe at some point in the future, we will compel you to we will ask you nicely to fill out some other terrible Google forms thing where we'll gather some data The the problem the problem with the surveys though is, like, our the people the number of people who filled up at survey about membership, even though it was not confined to members, like, hey, what do you think of our member's specials?
John: Very few people filled it out in terms of our the percentage of our audience. But the question we have about the future of the show really needs more of our audience to fill out, but who to fill out surveys. Alright. So I don't know, like, I'm not a survey master. I don't understand sampling theorems and stuff like that, but, even when the time comes, I'm sure the same subset of enthusiastic people who really care about the show will answer the survey, but when it comes to questions like this, that enthusiastic subset is probably the ones that we need to listen to because they're the ones who care the most about the show.
John: They care to fill out a survey or whatever. Anyway, we're thinking about it hope you're thinking about too. We just wanted to keep you in the loop so you know what we're dealing with over here and why we're thinking about this topic at all.
Marco: And also, like, I think it's worth, you know, for you hearing and, you know, trying to throw out ideas in it or thinking about, like, what we should do and everything. We could be a solely member supported show in theory. Like, that that is actually within reach. You know, we're not there with today's member numbers, but seeing how seeing how far we've gotten with membership, you know, without having that much that's member exclusive, I think we could get there. Like, I think we could replace our previous sponsorship income a hundred percent with membership in theory.
Marco: Again, it would take some growth from from the number base, but it's not like a totally ridiculous unattainable number. It's something that we have now proven is actually within reach and could be done?
John: I'll show you the numbers after the show. I think you're being very optimistic. I also believe we could do but it is not a slam dunk, especially in light of the things I just mentioned, like, oh, so you don't have ads anymore. Membership could go down. Doesn't grow a membership that decreases it.
John: So there's a lot of thinking we have to do. And I'm sure people are already writing their emails right now that are saying, I would be a member if you just lowered the price. I can tell you that, that the math about lowering the price, because, you know, obviously, when you talk about Casey's app, whatever your price is, it needs to be lower. Yeah. Until it's free.
John: And then we get back to advertising based things or whatever. It's really hard to make that back in volume. Like, if you cut your price and ask you ask you to get twice as many customers, is almost never true. I'm sure there's some economic theorem involving norm elastic that I don't know the term for that explains this or whatever. But if you do the math on it, especially with where you're changing things where a lot of people what what people are paying for with membership is an ad free show and now the show is ad free for everybody.
John: It's not so simple. Again, I agree with Marco that is definitely plausible, but it is not simple or easy. And it's not something, you know, we would have to again, ask our listeners how they feel about it before we said, oh, this will totally work because it's very easy to just not only not fix your problem, but just to make it ten times worse.
Casey: You know, I think it's important. We we talked about this a little bit already, but I think it's important to say it again You know, I'll speak for myself. ATP is the lion's share overwhelming majority of the Liss family income. To the point that everything else is basically like it's a Disney sized dot, if you will, compared to everything else. Compared to ATP.
Casey: I would be losing my mind if if members weren't here helping keep us afloat. And I mean us in both contexts. I mean ATP, and I mean the four of us in in the family, five if you include Penny. Genuinely. I know this sounds like I'm just sucking up and maybe I am, but I also really mean it.
Casey: If it weren't for members and and the amount of members that we have, I won't speak for you guys, but the Liss family would be in a real tough spot right now. Like, to the point that I would probably be starting to think about applying for jobs, if not actively applying for jobs at this point.
John: I'm part of that, by the way, for people who don't haven't dealt with advertisers is that membership pays monthly, essentially for the monthly members or annually for the annual members? Advertising does not work like that. Advertising pays whenever you feel like you can get the money from them. And, yes, there are supposed to, you know, oh, they're supposed to pay after x number of days or y, but I could tell you that one part of the business kind of like shrinkage. And if you know the the retail business, you know what the term for shrinkage means, people just have
Marco: I believe that's the Seinfeld term. I think the retail they call it just shrink, I think.
John: I think I think shrinkage is what it's like. I've heard, it's people don't know. That's a term of, like, if you if you run like a clothing store, some percentage of your stuff's gonna get stolen. And you have to factor that into your business. And one of the things you have to factor into your business, if you have a podcast where you have advertisers, especially in the tech world, is it some of the people who buy ads on your show will never pay you?
John: That's just a thing that happens.
Marco: The ad will run and and you won't get paid.
John: Then the company will go out of business. Right? If it's like a startup and they paid for an ad for their startup, they may go out of business before they pay for your ad. And believe me, when it comes time for the creditors of that of that VC funded startup, podcast advertisements are really low on the list of, getting that money. So that's just something we have to factor in.
John: But second thing is when people do ad buys, they buy them at a big chunk very often, and you get that big chunk after they have all run much later. So Casey's family will be flipping out because he'd be going literal months with no Linode, waiting waiting for that big ball of advertising money that is not a sure thing to hopefully Linode. And that is a potential cash flow problem. So but membership on the other hand is reg is nice regular income that comes on a monthly or annual basis that is way more predictable than getting money for advertisers.
Casey: Yep. This is exactly it. And not only that, but on top of everything, this is what Marco was talking about. It used to be that, you know, you would wait for all your ads to run and they would pay you in Boon bing Lompin. It was like Christmas, even if it was in February or whatever.
Casey: But that was when we had a direct relationship with advertisers. Now we have these agencies. And so the agencies are potentially doing are getting a tremendous lump sum of money from the advertiser. And then the agencies wait for the advertisers to pay them And then, of course, because it's an agency, they have to make everything difficult. And then it takes literally months for the money that is owed to us to eventually arrive at our doorstep.
Casey: It's it's really it's more difficult than you would imagine. And, yeah, again, I I say this because I want I want members to know how incredibly valuable you are to all three of us because hand to god, I would be in a bad spot right now if it wasn't for membership. Obviously, we have savings. I'm not saying I would be like destitute or anything like that. But but I would be dramatically changing my life and thus my family's lives if it wasn't for members.
Casey: I don't know how to stress how serious I'm being. I'm being extraordinarily serious. And that's how much we appreciate the members. And and I can speak for myself. When we floated some of these ideas, again, we're not changing anything when we floated some of these ideas about, like, taking the after show and pulling that behind a paywall or what have you, I am devoutly against it.
Casey: And and we haven't gotten serious enough about it to get into a, you know, a proper fight about it, but there may be a fight brewing between the three of us if against at that point. But that being said, at some point, my my kids gotta eat. And although, there are a trillion things I would rather do than pull the after show behind the paywall, that is something that is on the table if if we really get that death and gosh, I hope not to. I really hope not to. And and we're, again, we're saying all this in front of you because we don't want this to seem like a, oh, they had one bad week.
Casey: Now they're pulling everything. Like, that's that's not at all what this is, but it would be a it would be a bad idea not to think about it, like Marco was saying. And because we respect and value all of you, member or not, so much, we want you to know kinda where our heads are because we don't want this to be prize if in six months or a year, or maybe five years in the best case scenario, something changes. And and you and all of you are like, wait, what? That we don't want that wait what.
Casey: That's why you're that's why we are here with you right now. Again, you're not in the room, but you're in the room having this conversation with us. And We've got some stuff that we wanna try. We have, some member specials that we are we have ideas queued up. We haven't we don't have any specials queued up, but we are recording one.
Casey: This week. We don't know when it'll be out, but we're recording one this week, which we think you'll like. So we're trying to do what we can. Again, to be additive, and not take away something that previously existed. But eventually, everyone's got a price.
Casey: And if things get bad enough, you know, even I who is devoutly against, and I'm picking on the after show just because it's an obvious example. I am devoutly against taking the after show behind the paywall, but there will come a time that if if ads continue to stink, if membership goes down a lot, or, you know, if we need more membership in order keep the three of us going, even I will have a price at some point.
Marco: Yeah. And and also, like, we have other options on the table. We just would rather not take them. You know, one thing we could do is, you know, drop our ad rates down and drop our standards down so that we can get more ads. That I think is not the direction we wanna go.
Marco: You know, I don't wanna be reading crappy ads for things I don't really believe in. I don't wanna stick our name on something that that we would rather not stick our name on. And and there are certain price floors below which, like, it's not really worth doing the ad and taking the risk and everything. I mean, that's why I think, like, I see us leaning more into membership in the future in all likelihood. I mean, again, we're not announcing any changes yet because we haven't made any changes and we haven't decided any changes yet.
Marco: And heck, I mean, ads take so long to pay us that we could stop taking ads today, and we would still have ad income for the next year
John: or more or more. Yeah.
Marco: Like, we have we I mean, the amount of money that we are owed.
John: And the only thing to consider is the ad market does fluctuate. This is the biggest downturn we have ever seen. By far, And it could just be continuing to crater, which is why we're thinking about this, but it could also turn back up again. And that's another reason why we shouldn't suddenly start taking ads for like garbage, fake nutritional supplements that we don't believe in or, like, you know, whatever. All sorts of the the terrible ads that you care about, you know, that that on on other on other programs, you hear these ads.
John: You're like, I can't believe that they're actually smart. Like, that would destroy the value. It would I think it would destroy our reputation, but also it wouldn't be recognizing the value of our listeners because we don't our listeners are not just a random subset of the population. They are attentive listeners who care about our program who bought who are interested in products related to technology. They're probably interested in products that have nothing to do with it.
John: Or, like, like, that's why when we pick our advertisers, we try to pick advertisers that are a good fit for our audience and that who are willing to recognize the value of our audience and not treat them like an undifferentiated sea of people that are the same as the average customer for all podcasts across the entire world.
Marco: That's the problem. It's like, the way where the market is headed with all these, like, you know, big agencies and now big exchanges and big DAI platforms and everything, you're not really buying the show as much as you used to. And so our extra value of, like, how how good our listeners have been to direct advertisers and direct response advertisers. Like, you know, you hear Squarespace a lot. That's not a coincidence.
Marco: They are a direct response advertiser. We work with them directly and they see a ton of value in our ads. And that's they have been our longest running and and biggest sponsor by by far.
John: Oh, we should we should mention Linode here, by the way. This is a thing that particularly heard ATP. Linode has been a past sponsor. This is a company that Marco was using before they were a sponsor, a company that he liked, that was a perfect fit for our show. Technology related, product we believe in, and like Squarespace, the reason they're willing to pay for ads on our show is because they know our audience is potentially in the market for like hosting, on Linode.
John: Right? And because once they get a customer, that's recurring revenue because once you start hosting something, you pay that hosting bill month just like with Squarespace. So it is absolutely worth it for them to pay what it costs to run an ad on our show to acquire those customers knowing full well that our show is full of people who might wanna host something on Linode, and they were a great sponsor for us. We loved having them as a sponsor. They were a great fit for our, our listeners.
John: And we liked them. We liked the business. And then Akamai acquired them, and they stopped advertising on podcasts. And that hurt us a lot. Above and beyond, like, like, yeah.
John: So that market is down, which, you know, Marco sees in a general way and across Overcast advertising. But ATP in particular, Linode was such a good sponsor for us. And they why did they buy so many of our ads? Cause they were such a good fit for our audience, but Akamai doesn't wanna run podcast ads. So Yeah.
John: That was, you know, adding insult to injury.
Marco: Yeah. Like, if you look at how many of our episodes last year, sponsored by Squarespace and Linode, it's very frequent. It was, like, I they probably bought a similar number of ads, like, between the two companies each. And so to lose Linode really did hurt. That that was a huge amount of our inventory that is now just that used to be sold now is gone.
John: Everything about next year, Squarespace says, yeah, we're not doing podcast advertising anymore. Like, that would be massively destructive to the entire podcast industry. Mhmm. But also particularly to ATP because again, Squarespace I mean, you hear Squarespace that's in everything. Right?
John: But Squarespace for ATP listeners, that is much better than Squarespace on a comedy podcast. Who on a comedy podcast is running a website at all? I know Squarespace is gonna pitch it, but people listen to ATP, they should have a website. And they should buy a domain from one of our sponsors, and they should host it on one of our spot like, it's a perfect fit for us. So I really hope, they don't go the way that Linode did.
Marco: Oh, yeah. If we if Squarespace ever pulls out of our of our show as as an advertiser, I think that kills our ad program. Like, that's when we go member I think. Because I don't I don't think the Attoproger, I don't think our ads could survive that. Losing Linode was bad enough.
Marco: Losing Squarespace also would would be devastating. And that's also that's part of the reason why I'd like to push us more in the direction of member only because I don't like having to rely on one source of income like that. Like, that's not good for and security. So yeah. But, yeah, in general, like, that kind of relationship where, you know, were dealing directly with the sponsor and they're selling a, you know, a tech based subscription income product where they could where it makes sense for them to pay the high acquisition cost of podcast advertising like,
John: and one that we actually like and believe in to think is good.
Marco: Yeah. Exactly. Like, Squarespace and Linode, like, I'm able to talk about those constantly because I use them both, you know. Whereas, like, you know, any any other random podcast
John: Can you believe Squarespace and Linode didn't sponsor this episode? I know. Right.
Marco: Like, any other random random podcast ad you hear is, you know, not nearly as easy for us to to say, oh my god. This is perfect for our audience, you know, and and and have it be worth it to them as well. So anyway, all this is to say, like, as the industry moves towards everything in podcast advertising, being just commodities or you're just you're just buying a certain number of impressions on a certain demographic. Our show loses that. Because no one is buying high quality listeners specifically on a marketplace.
Marco: What you're buying is numbers and demographics. And we we can't give you that.
John: They just want warm bodies and and they need to know the demographics. They wanna know, you know, where you live and where you're they wanna know your IP addresses so they can find out everything that you can from an IP address, which is a frightening amount of information. They need that information to target their ads. And once they have targeted their ads, they don't care where they run and what shows they run. They just watch target those things no matter where they are, and it's just an undifferentiated sea of warm bodies, and that is value destructive to our podcast, which has a particular kind of listener that has a particular kind of value to a particular kind of advertiser.
Marco: By the way, it's worse it's worse than than that than that targeting. They also want, quote, attribution. This is this is like possibly the most invasive form of of ad tracking usually because what attribution means in the ad world is they wanna track who the ad has been served to. And that way, if later on, that person makes a purchase, they're able to associate this purchase was made after this person saw or heard or whatever, this ad. And that ad might have been a week ago or it might have been on a different device.
Marco: So that's why they they have all these, like, all these different tracking mechanisms. Try to fingerprint people and try to track you between different apps and services and different devices and different times. Because if an ad platform can tell advertisers this purchase was directly attributable to somebody who clicked on or listened to or whatever this particular ad you ran, that's a pretty strong feature for an ad platform.
John: And they don't they don't want you to have to remember use code ATP because code ATP doesn't identify you. There's no identifying information to that IP. They wanna know which specific person bought, and they do not wanna rely on you remembering to go to the landing page click on the link in the show notes or entering a promo Linode, they'll do it all behind the scenes, and they won't just know this person can hear me from ATP. They will know literally, you know, who you are based on your IP address.
Marco: Yeah. And and they don't have to do it themselves because there's lots of podcast tracking and hosting and ad serving services that do this for you. You know, I made this feature in overcast a while ago. Where I added this privacy button on every podcast's page in Overcast. You can tap that and you can see what domains and services those episodes are served through.
Marco: And if you look at the privacy page of any major podcast, any any podcast that that that, like, has like a big name and a staff. Look at click that privacy tab and you'll see the same handful of services on many of them And those and many of those are inter podcast tracking services that will take this data. They'll, you know, they'll they'll know who they served each DAI copy to. They'll be able to track it to certain demographics. They'll be able to attribute purchases to them later, which means a lot more tracking.
Marco: So That's that's the world of podcast advertising largely. There are still exceptions like our show, but we're dwindling. And the world is becoming more hostile to us and more difficult for us to sell our ads in. And and so this is the direction it's going, and this is the direction it has already gone. Like, This this fight is largely over.
Marco: Like, shows like ours lost. Like, that's not this is not the way things are mostly done anymore, and it's only moving more in that direction. We are very lucky that we have the membership program and that we established it relatively early. So that that way, we have we've been building an alternative. And we could run the show entirely on that theoretically.
Marco: You know, with some growth. And and but it's not again, don't think it's out of the question. I think we could actually get there. All this is to say, it this the future the specifics of the future are uncertain But but I think the future of this show is very is very solid. And I think we have lots of solid ground to to rely on here, to to keep building on.
Marco: Our members are great, and we thank you so much. And, and hopefully we will continue to try to figure out ways to get more members because when the ad market does finally create her for this show, whenever that happens. Hopefully, it never happens. But but if that happens and that's not out of the question, we we now have something else we can move to and that's that's pretty great.
Casey: Truly, truly and genuinely. Thank you to to all the member I cannot overstate how much we appreciate you. Or that's I think I'm pretty sure I speak for all three of us, but certainly certainly all four of us in the Liss family we appreciate that's what we appreciates about you.
Marco: Yeah. It it's really it's incredible that we have that we have such a strong backstop to fall back on as our ad sales are tanking.
John: And part of that is because we panicked when COVID was coming. Like, not panicked, but, like, but in general, again, for thought, we are we are all very good about, you know, sensing danger. But we sense danger, and we sense danger at COVID because no one knew how anything was gonna happen when COVID. It's like everything was up in the air. Who knows?
John: What's gonna happen? And so we need to have a backup plan and we started membership and in hindsight that was in hindsight, we didn't need it to save us through COVID because actually advertising, yes, it went but it kind of picked back up again. But boy, are we glad we did that back then? It was like, oh, we love our our, you know, members and stuff like that. Here's the thing.
John: It's also a more comfortable business relationship for us because we feel like you're paying for a thing directly that you want from us and we give it to you. And that makes so much sense and it's so straightforward advertising in the mix. It's not impossible, and there are, you know, we but it complicates it because there's three parties here. There's the listeners, there's the advertisers, and there's us.
Marco: Don't forget the agencies and the marketplaces and the salespeople.
John: Yeah. And obviously they're over getting, but, like, conceptually, like, again, we can we can navigate that. We can try to find good advertisers for our customers and have a good fit and all that or whatever, but it's so much simpler to just say you listen to the show and you like the show, and we wanna give you the show, and we wanna give you the show that you like, and then you pay us for it. And it's just so straightforward. Right?
John: It's just it's it's it is a it is mentally a relief, to the degree that we can make more of our customers be like that. Than, like, advertising, but we're just not entirely sure how to make that happen to the degree that we don't need advertising at all anymore.
Marco: Yeah. But but, you know, if when we when we first started doing this, like, the idea that it would ever be in in like, you know, possible, you know, reach distance of replacing ads, we would never have guessed that. We we specifically didn't. Like, we, like, when when we were talking about doing this, like, we never thought it would even be a chance that it might replace our eye to income.
John: Well, advertising going down the toilet really helps it.
Marco: Yes. It definitely has closed the gap.
John: a lot better. Yeah. Can you match zero? Because I think yeah.
Casey: Oh my. It's funny, but it's not funny.
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