The Business of Newsletters : How Viable, How Big Can it Ever Get?

Total
0
Shares

Banner ads. Clickbaity headlines.

Well, media industry has been marred with these business models which we all know leads to low-quality content. With the rise of subscription model, newsletters are making a comeback – but beyond a few flashy names (hello Ben!), what does it really mean for a publisher?

Can newsletter ever become a serious business? We bring you different perspectives on the newsletter business model.

Meanwhile, do subscribe to NextBigWhat’s #BigDaily newsletter.

[mc4wp_form id=”224158″]

1. 'Less is more' and other secret recipes for a thriving newsletter business

a) K.I.S.S  The newsletter is meant to de-clutter, so it should not be cluttered. Less is more with newsletters. For a long and fruitful relationship, the reader should not be deluged with either too many articles or ads.

b) LTV should be 5x of the reader's acquisitionThe Life Time Value of the reader (by the way of ads impressions she sees over a period of a year or more) should be between 3X to 5X of the acquisition cost. The need is to keep a fine balance by less cost of acquisition and lesser number of ads.

c) Two to tangoWhile there have been many successful 'single person' newsletters, but usually it takes at least a two person team to coordinate between all the activities of content generation and curating, editing, reader acquisition and ads sales.

submitted by

2. The important benchmarks to gauge the performance of your newsletter

While there are other metrics, to begin with the two most important metrics one should track everyday is the Open Rate and Click Rate in order to measure the efficacy of newsletters.

a) Open Rate is one of the best ways to gauge whether your email strategy is working. This number shows what percentage of your audience opens the emails you send them. A great open rate, it usually means your subject lines resonate with your audience. The average open rate is 21%.

b) The Click Rate is a percentage that tells how many successfully delivered emails got at least 1 click. This number shows whether or not audience finds emails relevant enough to click through for more. The average click-rate is 2.43%.

Further to it are, Bounce Rates and Unsubscribe Rate.

submitted by

3. The business models of newsletters

The business/revenue models of newsletters can be grouped in to four:

1. Freemium + Original Content

Newsletters from the traditional news publishers come in to this category. The sole purpose of such publishers is content marketing.

2. Freemium + Curated Content

From individuals to corporations, fall into this category. While there are some who publish their own analyses and perspectives, some use this form to drive traffic to their parent site. Most of such newsletters consist of re-written version of someone else's work.

3. Paid + Curated Content

The toughest one to crack, yet with the combination of algorithms and human intelligence, a really good set of curated work can warrant paid subscribers.

4. Paid + Original Content Some of the best 'one person' business has been created in this category and even a small set of ardent fans (paying) can ensure a consistent (and commendable) revenue for the publisher.

The median CPM (cost per thousand impressions) of an ad in an email is $3.45. That means if you have 100k subscribers, a weekly email would net you about $138 a month in revenue. While the CPM you can command various widely because of a whole set of factors, the takeaway is clear: you need some serious scale before this will make you much money.

submitted by

4. Newsletter : Where algorithms don't come between the publisher and the reader

Once a reader has signed up for a newsletter, that act of faith, becomes a direct and personal relationship between the publisher and the reader, which then is devoid of any external influences.

In today's world where the audience reach varies every Friday, on the mercy of algorithm changes being made by social media majors, the newsletter provides a consistent reach.

Confirming to the rules of social media majors for publishers, whenever they make an algorithmic change for the profit of their corporations, is a kin to being in a hostage situation, perpetually. The freedom of creation thus vanishes.

submitted by

5. The world's first social network and it is not anti-social !

Newsletter has been termed as “the world’s oldest networked publishing platform.”

It still persists for a variety of reasons, and the greatest among them is they do not pester, even while ensuring the networking.

There is no incessant rolling of notifications, trolling and stuff which is not necessary, least to say. Both for the reader as well as the creator, it does away with the addiction of constant consuming and sharing.

“With newsletters, we can rebuild all of the direct connections to people we lost when the social web came along.”

submitted by

6. The return of the king of influence – The Newsletter

“No one cares about traffic anymore. Everything is so divided up — you’ve got your blog, then Facebook, Instagram, Pinterest.”

The best part about newsletters have been that they are easy to consume, with few and focused items each morning, providing links where interested readers can take a deeper dive. 

And they’re regular, arriving always on a certain day, at a certain time.

In the times when plethora of content,is available all across the screens, 24x7, newsletter is still personal and intimate. 

Instead of surfing on screens endlessly, one can just 'arrive' in a matter of few minutes about what is most important for them, that day.

submitted by

Add your submission

Image Video Audio Text Embed

This field is required

Drop Images Here

or

Get image from URL

Maximum upload file size: 2 MB.

Processing...

This field is required

Drop Video Here

or

e.g.: https://www.youtube.com/watch?v=WwoKkq685Hk

Add

Supported services:

Maximum upload file size: 10 MB.

Processing...

This field is required

Drop Audio Here

or

e.g.: https://soundcloud.com/community/fellowship-wrapup

Add

Supported services:

Maximum upload file size: 5 MB.

Processing...

This field is required

e.g.: https://www.youtube.com/watch?v=WwoKkq685Hk

Supported services:

Processing...

Sign Up for Our Newsletters

Get notified of latest industry interviews and insights!

You May Also Like