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Proven newsletter business models

Anna from Revue
Anna from Revue
Hello newsletter editors,
Mark here again from Revue, the editorial newsletter tool for writers and publishers.
Monetization is one of the most requested topics to cover in The Week in Newsletters. And we’ve seen many cases of successful monetization with paid newsletters, digital subscriptions and also sponsoring. So today I will show you which methods have been shown to work for which formats.
Hope you enjoy the issue and would appreciate you forwarding it to a colleague or peer who might benefit from it. Thanks!

Which monetization works for which format?
Jacob Donnelly and Jarrod Dicker published a long rant last week titled “Don’t Blame Media’s Business Model”.
Jacob is in charge of B2B newsletters at Morning Brew and also publishes the paid A Media Operator newsletter. Jarrod is vice president of commercial technology and development for The Washington Post.
They’ve both seen a lot of media business models and basically state that there are plenty of viable ones and that publishers should focus on making them work:
The business model of media is fine. We either monetize our audience by selling exposure to them (advertising) or by selling things to them (subscriptions and goods). Both are perfectly viable models and have made it possible for us to continue reporting on things that are important. 
But there is a lot of work ahead of us on the operational side. We need to continuously deliver an amazing product to consumers worth paying for. No one balks at paying for a cell phone, gym membership, Netflix, BabyYoda+, Peloton and every other subscription. Why should they balk at paying for news if the product is actually important to them? 
I think this is a great attitude and we’ve certainly seen plenty of successes around newsletters over the last few years. So today I wanted to highlight some of the formats around newsletters where the business model is working.
Global news morning briefing digital subscriptions
There are many publishers succeeding with a model that aims to acquire new readers through a variety of channels, then convert those fly-by readers to loyal newsletter subscribers, and eventually sell them a digital subscription using some form of metered paywall.
The textbook example is The New York Times with its massive Morning Briefing, which Joshua Benton profiled for NiemanLab:
17 million subscribers is a lot for a newsroom newsletter. Even if a large share of those are dead accounts that never tap an email open, that’s a huge number of people waiting in that way station between “casual reader” and “paying customer.” Something north of 4 million people are paying Times subscribers.
The New York Times is likely the biggest but certainly not the only example of a publisher successfully using a newsletter to drive digital subscriptions.
Local news morning briefing digital subscription
A very similar format is working well for local news organizations. They focus on local news, events, sports and more rather than the global or national headlines. But the model is essentially the same, capturing an audience with a range of acquisition tactics, converting them to newsletter readers, and eventually digital subscribers.
Better News recently had a great case study about the Daily Memphian, a local news organization aiming to maintain 25,000 digital subscribers paying an average of $10/month. They focused a lot on newsletters and found success with the daily “The Early Word”:
One such newsletter is The Early Word, which we launched in November 2019. It has been hugely successful for converting new readers to paying subscribers. The Early Word is personally curated each business day by our digital director and includes direct access to our most popular local news stories. It is among our most-read newsletters based on open rates and campaign views.
The Daily Memphian is a great case, but there are many others, all using newsletters to create an audience of loyal local news readers that can be converted to digital subscribers.
  • Poynter has a great article about publications like The Boston Globe, The Star Tribune in Minneapolis and The Post and Courier of Charleston using newsletters to branch out to different cities.
  • Here on Revue, German publisher Madsack has a similar strategy, launching newsletters for many of its traditional local newspapers, and converting readers to subscribers using paywalled articles.
  • The Reuters Institute has many examples from the EU in a study about pivoting to paid that covers Kaleva (Finland), Etelä-Suomen Sanomat (Finland), Ouest-France (France), Nice-Matin (France), Westfalenpost (Germany), Main-Post (Germany), Yorkshire Post (UK) and Kent Messenger (UK).
Local newsletter sponsoring
Successful formats in local news built around newsletters are not restricted to digital subscriptions, though. There are several examples of local news publishers being successful with sponsored newsletters also.
Native ads inside newsletters are a key to success here. To be successful, the newsletter needs to become the trusted source of local news for a growing audience of loyal readers. And the sponsored messages need to blend in perfectly, featuring local businesses with messages that fit the newsletters tone and style.
A great example is 6AM City, with its seven newsletters in North Carolina, South Carolina, Florida and Tennessee. I wrote about them back in May:
Ad revenue is up for 6AM according to the case, thanks in part to a few key strategic decisions:
- The newsletters are hyper-local, focused on readers and advertisers from just one community.
- The newsletters are focused on reader engagement instead of list size.
- Newsletter ads are native and sold on a cost per open basis.
WhereBy.Us uses a similar model for their network of five local media brands in Miami, Seattle, Portland, Orlando and Pittsburgh.
State of Digital Publishing interviewed their CEO, Chris Sopher:
We’ve spent a lot of energy on what it takes to scale while keeping local authenticity.[…]
We use a combination of video, social storytelling, interactive content, newsletter content, and events. We customize the approach we use for each client, so we’re always being responsive to their specific needs and goals.
Demographic newsletterfirst sponsoring
We’ve seen that local news newsletters can be turned into a successful format with either digital subscriptions or sponsoring. Another area where sponsoring has been proven is the newsletter geared towards a specific demographic.
The two major cases here are TheSkimm and Morning Brew. And both work with native ads similarly to 6AM City and WhereBy.Us.
TheSkimm is a newsletter-first company delivering general news to millennial women. It has an audience of around 10 million readers that it monetizes through native ads right inside the newsletter.
Morning Brew, with a similar model focused on a more male audience, is also very successful and was recently acquired by Insider Inc.
StudyHall summarized nicely why these models remained viable even with ad budgets under pressure during the pandemic:
Newsletter companies like Girls Night In, Morning Brew, or The Skimm are still doing well because they have a more direct relationship with advertisers and readers and they have much smaller staff numbers because the work is often more about aggregation than creating original content. This isn’t a model for a major newspaper, but it is a bright spot.
And The Media Nut added some details about how that is done in an interview with Morning Brew:
We have always created creative in-house for brands; our copy writing team writes. We run “native ads” in our newsletters and podcasts; copy ranges from 100-150 words and they feel similar to the Morning Brew voice. We recently started doing custom images. We do custom edit images.
What’s stayed consistent: having an in-house sales team. About 75 percent of our business is direct, and 25 percent is with agencies.
Expert niche newsletter paid newsletter
The paid newsletter has been getting a lot of attention over the last few years and many indie authors have been very successful at it.
One of the early adopters, Nick Quah, was recently profiled by Marker. Nick started his paid newsletter about the podcast industry, Hot Pod, in 2014 and has turned it into a great business for himself:
His newsletter Hot Pod now has between 20,000 and 25,000 subscribers and earns six figures, he says — a substantial figure for what amounts to a trade journal written almost like a personal zine.
The approach of the paid newsletter is for an independent author to build up a big enough audience and convert enough of that audience into paying members to make a living.
An audience of 10.000 or more, of which some 10% are willing to spend between $5 and $10 per month, is often given as a good initial target for a viable personal business.
The key to success is finding a good niche. Big enough to find the necessary audience, but also underserved enough to be able to charge for the content.
Another example is Casey Newton, who recently left The Verge to turn his newsletter about Facebook, social networks, and democracy into an independent business. In an interview with OneZero he shared similar figures:
When you look at the economics of newsletters, there are opportunities that are bigger for some writers than any media company can match. If you can find 10,000 people to pay you $100 a year, you’re making $1 million a year. No one in media is going to pay you that unless you’re the anchor of a popular news show or something.
Both Nick and Casey found a great, and probably also timely, niche, an absolute must to be successful with a paid newsletter. Nick started Hot Pod when podcasting was still small, and Casey spotted the issues around social media before most others.
Another such trend is crypto, which Scott Melker is covering in his successful newsletter The Wolf Den here on Revue. Scott’s niche is chart analysis to discover opportunities in both traditional markets and cryptocurrencies.
Several global news publishers are using daily briefings to make digital subscriptions work. Some local news organizations use the same format towards digital subscriptions, but others are successful with sponsoring in local newsletters. Sponsoring also works for newsletter-first startups with a demographic focus. And indie authors are making paid newsletters work.
There are other combinations, such as B2B publishers with sponsored newsletters, indie authors generating leads for their own services, long-form newsletters for members of investigative reporting, voluntary contributions in various forms and more. And some publishers are working on some of the above combinations that have not been proven widely yet.
So from a newsletter perspective, I would confirm what Jacob and Jarrod stated. There is a range of viable business models across types of publishers and monetization options that publishers can choose from and apply to their business.
The week in newsletters
Growth at Morning Brew
POLITICO Europe shares some stats
WIRED profile of Patrice Peck
Case studies The Independent and Dennik N
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Anna from Revue
Anna from Revue @revue

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