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!
Understanding your readers is key.
To gather information about your audience, you can:
Knowledge is power, and in this case, it's also potential revenue.
Consider collecting the following information:
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.
Before diving into paid sponsorships, consider cross-promotions with relevant newsletters. This approach can help you:
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.
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.
Diving deep into each approach:
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.
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.
This knowledge comes with time and gathering insights from ad placements.
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).
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.
*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!
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:
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.
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:
Here’s a detailed example:
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.
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.
Pro tip: When it comes to URLs from advertisers, consider adding UTM tracking parameters for more accurate data tracking.
When reaching out to potential sponsors, create a well-crafted pitch highlighting the benefits of advertising in your newsletter. You could include:
It’s important to research any potential sponsors to ensure the product or service aligns with your audience and vice versa.
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!
Ensure your processes are efficient and easy to follow.
Think about creating a checklist or process that covers:
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 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.
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:
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.
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