How Do Online Radio Stations Make Money.

How Do Online Radio Stations Make Money.

 

A radio station’s revenue streams can be divided into two main categories: advertising (also known as “sponsored content”) and sponsorship.

Advertising is most commonly used by commercial radio stations, such as talk radio and music stations. Sponsorship is used more commonly by non-commercial radio stations, particularly community-oriented and college stations. All types of online radio stations, such as Talk Radio, Spoken Word, Music, and Educational Radio can run advertising and sponsorship revenue streams. In addition, some online radio stations can charge a “membership fee” to access their content.

The major online radio advertising and sponsorship revenue streams include:

Listened to Ad – This is the most common form of online radio advertising. The online radio station will purchase the list of listeners, which is compiled by a third-party service such as the GFK Group. Listened Ad campaigns typically last for several days to several months. The duration can depend on the goals of the online radio station. For example, if the station wants to build its listener base quickly, the Listened Ad campaign might be very short. If the online radio station wants to generate more revenue, the Listened Ad campaigns can be longer.

Sponsorship – Online radio stations can also sell sponsorships to its listeners. In this case, the online radio station is not buying a list of listeners, but rather selling individual sponsorships to listeners in exchange for cash. Sponsorship campaigns are typically longer than Listened Ad campaigns, due to the larger number of sponsors that are involved.

Other Revenue Streams – Online radio stations can also generate revenue from a variety of other sources. These sources include: included in the monthly fee that listeners are charged for access to the station’s content. Currently, the major sources of revenue are:

Fee-Based Advertising – The number one source of revenue for online radio stations, including non-commercial and educational radio stations and websites, is a monthly fee based model. This type of advertising is typically called “membership fees”. Membership fees are common in certain types of online radio stations, but are also used by a variety of other types of websites, including internet newspapers and blogs.

Advertising Revenue – This is revenue that an online radio station generates from advertising. This can be categorized as either direct or indirect. Direct advertising revenue includes:

Direct Advertising – Advertising is typically purchased by radio stations and companies and then shown on the radio station. This type of advertising is typically called “radio advertising” or “FM advertising”.

Indirect Advertising – Advertising is purchased by an online radio station and then sold to other companies. This type of advertising is typically called “internet marketing”, “digital marketing” or “web advertising”.

Subscriber Fees – This is a method for generating revenue. It is the most widely used method for generating revenue in the online radio industry. A station can charge its listeners a monthly fee for access to its content. This type of advertising is typically called “membership fees” or “listener fees”.

Other Revenue Streams – Other types of revenue streams include:

Misc Revenue – Miscellaneous revenue streams can include percentages of sales from merchandise, fees for access to content, fees for membership or listener access to the station website, and royalties from the station’s host(s).

Tiered Advertising and Sponsorship – Tiered advertising and sponsorship is a method that can be used by any type of online radio station. With this model, the type of content that a listener is accessing can vary depending on the level of payment that is made for the service. This model is typically called “volume based advertising” or “pay per view”.

Non-Profit Advertising and Sponsorship – Non-profit radio stations are often exempt from the Federal Communications Commission (FCC) rule that requires a “fair exchange of ideas”. Thus, these stations can purchase sponsorships and advertising that are not required to be “fair”. The revenue generated by a non-profit station is typically used to fund the station’s operations.

Content Sponsorships – A content sponsorship involves generating revenue through a third-party sponsor. The third-party sponsor typically has access to content such as music, movies, and books, and the online radio station is able to generate revenue from the sales of this content.

Affiliate Revenue Sales – This is a form of revenue that a radio station is able to earn from a website. There are several types of affiliate sales:

Affiliate Sales– This is the most common type of affiliate revenue. Affiliate sales are also known as “affiliate marketing” or “affiliate programs”. When a radio station facilitates the sale of third-party products or services, it can earn a commission from the sale.

Direct Affiliate Sales – This is direct affiliate sales. When an online radio station is able to sell directly to prospects, it can earn a commission from the sale.

Indirect Affiliate Sales – This is indirect affiliate sales. This type of affiliate sales is where an online radio station is able to sell to a prospect through an associate or third-party affiliate. The online radio station can then earn a commission from the sale.

Non-Profit Affiliate Sales – This is revenue that is generated by an online radio station through an affiliate or affiliate program. This is an exception to the “fair exchange of ideas” rule. The affiliate program typically runs a “tiered advertising and sponsorship” model, which involves the sale of content based on the level of payment.

 

Other Affiliate Sales – Other types of affiliate sales include:

Cookie Sales – Cookie sales are affiliate sales where a radio station is able to sell a cookie to a prospect. This type of affiliate sales is typically used internally by a radio station.

Non-Profit Affiliate Sales – This is revenue that is generated by an online radio station through an affiliate or affiliate program. This is an exception to the “fair exchange of ideas” rule. The affiliate program typically runs a “tiered advertising and sponsorship” model, which involves the sale of content based on the level of payment.

Other Affiliate Sales – Other types of affiliate sales include:

Advertorial Sales – Advertorial sales are affiliate sales where a radio station can sell a brand-name product. This type of affiliate sales is typically used internally by a radio station.

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