April 14, 2023

A guide to sponsorships in newsletters.

You've been dedicating time and energy into creating an engaging newsletter, and you’re thinking about monetizing it through sponsorships.

That's an exciting step to take!

Sponsorships in newsletters provide mutual benefits for creators and companies looking to promote their products or services. They also allow creators to keep content accessible to the public instead of placing it behind a paywall.

If you’re considering Sponsored Content in your newsletter and need guidance on how to start, we’re here to help you through the journey.

Let's get started!

🔑 Key takeaways

  1. Know your audience.
  2. Test the waters with cross promotions.
  3. Understand and set competitive pricing.
  4. Make it easy for sponsors.
  5. Streamline the booking process.
  6. Craft a compelling pitch.
  7. Outreach and marketplaces.
  8. Establish a smooth process for sponsors.
  9. Clarify ad terminology: Tomato, tomato?
  10. Monitor, test and iterate.

🧠 Know your audience

Understanding your readers is key.

To gather information about your audience, you can:

  • Send out a survey to current subscribers.
  • Collect information during newsletter sign-up or onboarding.
  • Analyze newsletter engagement metrics (What type of content resonates, etc.).
The Newsletter Newsletter

The Newsletter Newsletter

Knowledge is power, and in this case, it's also potential revenue.

Consider collecting the following information:

  • Number of subscribers
  • Growth rate (e.g., subscribers added per month calculated as a 90-day lookback)
  • Open rate (Note: This may not be a reliable metric due to Apple MPP)
  • Click-through rate (# of Clicks / # of Emails Delivered)
  • Audience description (Industries, interests, etc.)
  • Audience location (Country)
  • Job titles
  • Annual earnings

Pro tip: If readers are filling out a form, or survey, consider providing options to select from instead of an open text field.

For example: List out Countries for the reader to choose from: United States, United Kingdom, Canada, Australia, India, etc.

Why is this information important?

While you may not need all of the information listed above, having a solid understanding of your audience demographics can help match your newsletter with potential sponsors. This baseline knowledge allows both parties (newsletter publishers and advertisers) to make informed decisions about potential partnerships.

Each sponsorship also serves as a learning opportunity. As you work with different sponsors, you'll gain insights into what works best for your audience and adjust your approach accordingly.

🤝 Test the waters with cross promotions

Before diving into paid sponsorships, consider cross-promotions with relevant newsletters. This approach can help you:

  • Gain experience with Sponsored Content.
  • Understand audience engagement with Sponsored Content.
  • Potentially increase your subscriber base.
  • Collect testimonials to feature on your Sponsorship page for future, potential sponsors to see.

Example: Partner with another newsletter in your niche to promote each other's content. This not only helps you understand how your audience engages with Sponsored Content but also introduces your newsletter to a new audience.

📊 Understand and set competitive pricing

The million-dollar question is: How much should I charge for newsletter sponsorships?

Start by researching the rates of comparable newsletters in your niche and establish a competitive price that reflects the value you can offer to advertisers.

Keep in mind that there isn't a one-size-fits-all formula for calculating how much to charge.

Factors to consider when setting your pricing:

  • Subscriber count
  • Open rate
  • Click-through rate
  • Audience engagement
  • Industry niche
  • Exclusivity of ad placement
  • Ad format (text, image, native content, etc.)

Here are several different approaches to consider:

  • Flat Rate
  • Cost per Mille (CPM)
  • Cost per 1,000 Opens (CPO)
  • Cost per Click (CPC)

Diving deep into each approach:

Flat Rate

Charge a fixed amount per sponsorship, no matter the number of subscribers, Opens or Clicks. It's simple and straightforward for both you and the advertiser.

Example: Charge a flat rate of $250 per newsletter sponsorship. Every advertiser pays this amount for an ad placement, regardless of the number of subscribers, Opens or Clicks.

Cost per Mille (CPM)

CPM, or cost per thousand, is a widely used advertising metric that indicates the cost an advertiser pays for one thousand views or impressions of an advertisement.

Calculating CPM for email newsletters can be challenging, as rates can vary significantly depending on factors such as industry, audience size and engagement.

To calculate CPM, use the following formula:

CPM = (Cost of sponsor ad / # of email subscribers) x 1,000

For example, if your newsletter has 7,000 subscribers and you charge $25 per CPM, you would charge $175 per ad:

CPM ($25) = (Cost of ad $175 / 7,000 subscribers) x 1000

This method uses industry-standard terminology, but keep in mind that CPM doesn't directly indicate performance. It covers potential impressions, not the actual number of people the ad reaches.

To estimate your CPM based on a flat fee, first determine a reasonable fee that is in line with other newsletters in your niche. Divide the fee by your total number of subscribers and multiply by 1,000.

Example: For a 100,000-person newsletter, let’s say you want to charge $2,500 per ad placement.

$2,500/100,000 × 1000 = CPM which would be $25.

Another way to calculate is:

Nominal ad price = CPM rate (in $) * (Subscriber count / 1,000)

$25 * (100,000/1,000) = $2,500 per ad placement.

Factoring in Click-through Rate or number of estimated Clicks can be helpful when determining the cost of sponsorships.

You can also be specific with providing an estimated number of clicks per ad so the Sponsor has an idea of estimated traffic.

Justin Welsh

This knowledge comes with time and gathering insights from ad placements.

Cost per 1,000 Opens (CPO)*

CPO is a newsletter-specific metric based on every 1,000 Opens. It ranges between ~$20-$100+, but the numbers can be a bit fuzzy with multiple factors at play.

Example: If your newsletter has an average of 5,000 Opens and you charge $50 CPO, your sponsorship price would be $250 (5,000 Opens / 1,000 * $50).

Cost per Click (CPC)

As Clicks can be more reliable than Opens, charging per click generated is an option. Advertisers may have a CPC based on ads they're running on other digital channels.

It’s not an apples-to-apples comparison, but it does add to understanding the “cost” per click and the spend on various channels.

For example, an advertiser receives ~50 Clicks on a LinkedIn ad, and two convert into purchases. A newsletter ad gets ~50 Clicks, and 10 convert.

The newsletter clicks would be more valuable for that advertiser.

Example: If a newsletter charges $3 per click and an ad receives 25 Clicks, the advertiser would pay $75.

Additional observations

*Since email Opens and Open Rates may not be as reliable due to Apple’s Mail Privacy Protection, consider blending different pricing methods for greater accuracy.

You can also consider offering tiered pricing based on the type of ad.

For example: A “Primary” sponsor might include a logo at the top and dedicated section in the middle for $X, while a “Text” ad might be a couple of sentences and cost $Y.

Continue to monitor Clicks, Click-through Rates and Unsubscribes to help you make data-driven decisions about Sponsored Content in your newsletter. This helps you set expectations for both readers and advertisers.

Ultimately, you want to provide relevant content to your audience. Align Sponsored Content with your readers' interests to create a seamless and enjoyable experience.

Side note: Feel free to adjust rates as you go! As you continue to learn more about your newsletter’s performance and the advertising landscape, you can adjust your pricing accordingly. Stay flexible!

🔍 Make it easy for sponsors

Create a clear and concise sponsorship page on your website, where potential advertisers can find all the necessary information about your newsletter and advertising options. You can include things like:

  • Audience demographics.
  • Newsletter statistics (subscriber count, growth rate, etc.).
  • Ad formats and placements.
  • Pricing and payment details.
  • Testimonials from previous sponsors.
  • A contact form or email address for inquiries.

Example: Front Office Sports links out from their email footer to an informative page that provides a clear overview of their audience and case studies from previous sponsors.

Example from Front Office Sports

✅ Streamline the booking process

Now that it’s easy for sponsors to find out how to advertise in your newsletter, let’s ensure the booking process is simple.

The booking process for a potential sponsor might look like this:

  • Email a specific email address like
  • Fill out a Google Form asking for information like email address, budget, etc.
  • Arrange booking and payment, and then coordinating on assets, etc. like this example from Justin Welsh:
Example from Justin Welsh

Here’s a detailed example:

  1. Potential sponsor clicks the “Advertise” hyperlink in your email footer.
  2. Sponsor submits a request for placement type and date, along with contact information.
  3. You determine if it’s a good fit for your audience and confirm dates.
  4. Send an invoice and receive payment.
  5. Send over an Insertion Order (an agreement between you and the advertiser).
  6. Send the sponsor a Google Form to submit copy, desired URLs (with tracking!), and any imagery.
  7. If any edits are needed, send the updated copy to the sponsor for final approval.
  8. If approved, go live!
  9. Circle back after the email send to share any metrics.

While thinking about the sponsor's experience, you might not need a fully scalable or "automated" process, but it's essential to view the process from their perspective.

Consider using third-party platforms to help with booking or create your booking system with tools like Google Forms, Airtable or Notion.

A few extra insights

Decide if you want the option to edit any copy from an advertiser to match your newsletter's tone. If you plan to, mention it throughout the process.

It's worth noting the impact advertising can have on businesses for some readers, newsletters, and companies.

For example: Axios includes a disclaimer at the bottom of their emails.

Example from Axios

Pro tip: When it comes to URLs from advertisers, consider adding UTM tracking parameters for more accurate data tracking.

The Newsletter Newsletter

⚾ Craft a compelling pitch

When reaching out to potential sponsors, create a well-crafted pitch highlighting the benefits of advertising in your newsletter. You could include:

  • Brief introduction (What is the newsletter, etc.).
  • Subscriber count and growth rate
  • Audience demographics
  • Success stories or testimonials
  • Call-to-action with a link to your sponsorship page

It’s important to research any potential sponsors to ensure the product or service aligns with your audience and vice versa.

👋 Outreach and marketplaces

Once you have your pitch, you can think about reaching out to potential sponsors who align with your values and audience, or consider joining newsletter marketplaces to connect with advertisers.

WhoSponsorsStuff, Lettergrowth among others can be a starting point. ESPs like ConvertKit launched similar networks as well.

We haven’t tried the above, but if you have, feel free to send us an email and let us know! 

🧈 Establish a smooth process for sponsors

Ensure your processes are efficient and easy to follow.

Think about creating a checklist or process that covers:

  • Timely communication and response to sponsor inquiries.
  • Clear guidelines for ad creatives (dimensions for images, editorial authority, etc.)
  • Deadline reminders for ad submissions (“All creative must be received at least 72 hours prior to ad placement date,”).
  • Sponsorship agreement or contract outlining terms and conditions.
  • Ad performance reports to share with sponsors. (It can be helpful if they share data with you as well. Such as number of conversions generated, etc.).

🍅 Clarify ad terminology: Tomato, tomato?

Ensure that you and sponsors are on the same page when it comes to terminology.

Different industries and platforms may use slightly different terms, so it's essential to clarify.

For example:

  • Native ad: Sponsored Content that seamlessly integrates with your newsletter content.
  • Text ad: Simple text-based advertisements with a link

Native ad might also be known as a Primary ad, or a Text ad as a Classified ad, etc. It can be helpful to have examples to make sure you’re both on the same page.

Example from Marketing Examples

🧪 Monitor, test and iterate

As always, it’s important to note that what one newsletter does may not yield the same results.

Each newsletter and each audience is unique!

Monitoring, testing and iterating can help you get closer to understanding more about your audience. What resonates with them, what doesn’t, etc.

If you decide to start working with sponsors, it’s key to monitor and analyze performance of Sponsored Content in your newsletter.

This helps you make data-driven decisions and improve your sponsorship offerings.

Here are some thoughts starters:

  • Track key performance indicators (KPIs): Monitor metrics like Open rates, Click-through Rates and Conversions for Sponsored Content. This will help you understand what types of ads resonate with your audience and inform future collaborations.
  • Experiment with ad placements and formats: Test different ad placements within your newsletter (top, middle, or bottom) and experiment with various ad formats (native ad, text ad, etc.) to see which combinations perform best. Morning Brew deep dive for more!
  • Seek feedback from sponsors and readers: Ask sponsors for their feedback on the sponsorship process and the results they've experienced. You can also ask your readers for their input on Sponsored Content to ensure that it aligns with their interests and expectations.
  • Revise your pricing strategy: As your newsletter grows and your audience becomes more engaged, you may need to reevaluate your pricing strategy. Consider adjusting your rates based on your newsletter's performance, industry benchmarks and feedback from sponsors.
  • Optimize your pitch and outreach: Continuously refine your pitch and outreach strategy if you would like to gain more sponsors. Use the insights gained from previous sponsorships to demonstrate the value of advertising in your newsletter.
  • Keep up with industry trends: Stay informed about best practices and trends in newsletter advertising. This knowledge will enable you to adapt your sponsorship strategy accordingly and maintain a competitive edge in the market. Like subscribing to The Newsletter Newsletter 🙂

In a nutshell, monetizing your newsletter with sponsorships can be a rewarding experience for both you and your sponsors. By diving deep into your audience insights, testing different strategies, streamlining the sponsorship process, you can unlock a new revenue stream for your newsletter.

Keep learning, iterating and refining your approach to maximize the value you provide to both your readers and sponsors.

🎉 Have a great weekend!

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