Finding Sponsors for Your Podcast

On November 4, 2011 I spoke at Blog World Expo Los Angeles on a panel session organized by Jean MacDonald, partner at Smile Software. The topic was Finding  Sponsors for Your Podcast (and keeping them).  Also on the panel were Dave Hamilton, founder of Backbeat Media, The Mac Observer, and cohost of Mac Geek Gab; and David Sparks, who writes the MacSparky blog, and is cohost of Mac Power Users podcast. Two on the panel were podcast sponsors (Jean, and me from my days at Drobo), two were podcasters (Dave and David). Dave Hamilton added another perspective based on his experiences at Backbeat which is an agency connecting advertisers with podcasters and bloggers.

Below I are slides and comments from my presentation at the Blog World Expo session.

This is my cover slide. I’ve reproduced in on my own slide template.

I live in Silicon Valley. My professional career has been spent building new businesses. This is either through working inside a corporation, or as a professional services provider.

In July 2005 I started a project for a former client – serial entrepreneur Geoff Barrall. That startup company later became Drobo. I liked the technology and market opportunity that I phased-out other clients and worked exclusively with Drobo for over five years.

At Drobo podcasts were a key tool to our getting noticed. As a startup we didn’t have a huge marketing budget. I needed a way to deliver my message directly to people that our research proved were our target market. Podcasts were a key way to do this. Over time I sponsored almost 30 different shows.

The bottom line is that sponsors want sales from podcast listeners. Unfortunately this is not always easy to track. Why? Unless there is a unique distribution channel for your podcast its prove where sales come from. Especially if you are distributed through a company like Amazon. Unique offers and discount codes are terrific tools, but will your sponsor want to train its target market only to buy by offering incentives like this all the time?

Given this uncertainty, a sponsor might settle for increased awareness of its products provided that it is accompanied by  increased sales. To succeed in this arena, the podcaster should have a companion blog that can drive traffic to the sponsor’s Web site. Using dedicated landing pages on either the sponsor’s or podcaster’s site is a way to provide a measure of traffic which is a proxy indicator for increased awareness. Figuring out the sponsor’s objectives — sales or awareness — is key to a successful sponsorship. This area is too complex to delve into her win more detail. Feel free to contact me for more information.

The relationship between a podcaster and listeners is an intimate one. The sponsor is looking to be introduced to listeners. As a podcaster you control access to a specialized community. I have research that shows listeners place more trust in products that they hear podcasters mention. To learn more about this visit tripleMOJO.com, or contact me directly.

As a podcaster how do you find sponsors? This is a multifaceted question. You can try to get sponsors yourself, or work with a network who will make a match between you and advertisers.

If you want to find sponsors yourself, the I recommend to start looking with products and services that you use. Why? Because of the intimate podcaster/listener relationship, listeners can tell from tone of voice and other cues if the podcaster is speaking from the heart, or just reading a sponsor’s message. If you truly use and love a product or service, then you can recommend it to your listeners., and they will know its genuine.

Once you have ideas for listeners, how do you approach a sponsor? There are two dimensions to this.

The first aspect is to document, in writing, why your listeners would be interested in the sponsor’s product. I recommend you write a short paragraph that describes your show, listener’s interests, and why you can help the sponsor sell more product. Write it down, the process of doing so will focus your thinking and identify gaps in the pitch you are making.

Now the hard work – networking your way to the manager who has authority to sponsor you. The best thing is if you can use your network to get  inside the sponsor’s company. If you can’t then be prepared for lots of dead ends and people saying “no.” Tools like Twitter , Facebook, or LinkedIn can help you find the correct person inside the company. So, too, can old fashion cold calling. Try to call their sales , describe your objectives,  and ask for an internal referral. You will have to be prepared, just asking for someone will not get you very far. Once you have a friendly person who will help, email directly to him or her the writing your prepared and ask them to forward it onward. Don’t send to generic sales@xyz.com, or marketing@xyz.com addresses at this point. At this point you are making a sale, and followup and perseverance are your best tools.

Once you have sponsor candidates and are discussing what the sponsorship is you need to think about how to make it win for all three parties. Your listeners will be welcoming of learning about new products or services, especially if the align with the topic of your show. Just don’t bore them or alienate them, i.e. don’t alienate your audience. Be sure to have a clear and easy to follow call to action. You want to drive them to a place to purchase, or to learn more. Scripting the next step depends very much on the product. You will make it a win for your sponsor if your listeners buy. Don’t forget that increased awareness is one of the ROI factors sponsors look for. If you get messages from your listeners talking about the product, or how they bought because you brought it to their attention, then send them to your sponsor. This is proof that your audience is responding.

If you have questions, feel free to reach out to me as shown above. Good luck with your podcast show and your new sponsors.

Setting Your Price: Why $99.99 is better than $100.

 

Some people often wonder why prices are set at at numerical values that are close to round numbers. Instead of ending in .00, which can be simplified to a simple decimal point “.” – prices are set a little lower and have lots of digits, ending in repeated 9’s – $99.99, $999., etc. The way our brains process information is such that seemingly minor price changes have huge impacts on how they are perceived. This is why when setting price points it is better not to round off to an even number, like $100, and instead use $99.99.  Read on, I’ll show why when you are setting your price why $99.99 is better than $100.

Theory

One tool in the arsenal of marketing executives to help set prices is the “van Westendorp Price Sensitivity Meter” – hereafter vW-PSM (consult Wikipedia if this is new to you)  This tool works by asking target buyers a series of questions that probe their attitudes toward the product/service and their expectations on price. The tools works by analyzing the interaction of answers. The questions are simple – they are:

  1. What price for this product/service is too low such that you would doubt its quality?
  2. What price would you expect to pay for this product/service?
  3. What price would you think is a bargain such that you would definitely buy the product/service?
  4. What price for this product/service is too expensive such that you would not buy it?

I will not bore you with a dissertation on the  the van Westendorp Price Sensitivity Meter. Its a tool that has been used and, erroneously, abused. If you want to learn more about this tool then here is a link. This is an article written by my colleague Nico Peruzzi. It is based on some projects using the van Westendorp approach we did together while I was an exec at Drobo.  Nico’s thought provoking article is “The van Westendorp Price Sensitivity Meter – Are We Using It Incorrectly.”

Practice

In order to understand why $99.99 is better than $100, look at van Westendorp question #4: What price for this product/service is too expensive that you would not buy it? The responses show how small price differences like $.01, or $1.00 cause people to react differently. Depending on your product, if you are even $.01 more expensive it can cause a large percentage of your target market to think you are too expensive to consider purchasing.

The image below shows the responses to a 2010 survey exploring response to a hypothetical consumer personal cloud storage product. The survey was completed by 1,694 people — a huge number given given research practices at many high tech companies. This chart shows the cumulative probability distribution (CDF to any math geek readers) of the price at which the product is too expensive to buy.

 

There are two important lessons in this chart that you can use:

Pricing discontinuities – don’t step on a land mine: there are price ranges that vary by a few dollars where there is a huge shift in the percentage of your target market who think the product is too expensive to buy. I have marked these with the arrows on the diagram and the price points at which the discontinuity occurs (in this study a $3-4 dollar difference separates the “steps”).  By observing the sudden “jump” in the stair step curve you can understand the perceptual impact of a minor difference in the expressed price. These explain why $99.99 is better than $100.

Price indifference – don’t leave money on the table: between the jumps, there are broad price ranges over which buyers don’t perceive a difference. In other words, you can price at the high end of the range, or you can “leave money on the table” by pricing too low. In the results shown above, each of the “steps” is about 30% wide. By this I mean that the next “jump” is at a price point higher than the one that triggered the current plateau.

Insights For You To Use

The van Westendorp Price Sensitivity Meter is not the perfect tool. It is best used when there is no ability to change the product specification and your are looking to set the best price. This is a very common situation – like if you are the marketing VP who joined a startup a company with a “ready to launch”  product that has not had proper market vetting. Is this an ideal pricing tool? The full vW-PSM approach gives noisy results. I will discuss these in future posts if there is enough reader interest. The key benefit of the van Westendorp approach is setting a price that maximizes attractiveness to your target market, yet doesn’t leave money on the table.

A Real World Example: Amazon Kindle Pricing

To show that the discussion above is not “analysis paralysis” (link to: ) or worse . Consider the 9/28/11 introduction of the new Amazon Kindle . Amazon’s CEO and Founder Jeff Bezos introduced the new Kindle product family, making effort to position it as a low cost competitor (against the unspoken Apple iPad.  Bezos’ presentation had an analysis  singing the reasons why a Kindle priced at “$99” (and, implicitly, not $100) would excite his customers to buy.  Amazon wants to hit a home run and make their new Kindles very successful. Setting a price on the correct side of a van Westendorp price discontinuity is one key to that objective.

Still Not Convinced?

If you still have questions or doubts — let Tactics remove them. Contact us. We will to do a vW-PSM for you and test how YOUR customers value your product. We are confident we can show you why when Setting Your Price: Why $99.99 is better than $100, $199 is better than $200 and $999 is better than $1,000.