Newsletter Sponsorships Require Subscriber Acquisition

Email newsletter sponsors pay for reach and attention, usually to sell something. So, publishers must have an influx of new subscribers or new sponsors to keep sponsorship revenue flowing.

This fact surprises some publishers or content creators. They argue that sponsors are more concerned with an engaged audience or that they only work with sponsors doing "branding," which these creators take to mean buying sponsorship ads without asking for results. This notion is flat wrong.

The Sponsor-Subscriber Conundrum

An illustration might help explain the problem. Imagine it is your job to do the marketing for a small software-as-a-service (SaaS) company. Your primary measure of success is when a new user pays for a subscription.

You find an amazing weekly newsletter with 100 extremely engaged subscribers and buy a sponsorship. About 20 of the subscribers are already your customers. Another 20 are not a good fit or cannot afford your service. Leaving 60 real prospects. The campaign is a fantastic success. And over the next 12 weeks, your sponsorship ads convert every one of those 60 prospects into a paying customer.

You see it, right? In week 13, the campaign falls flat. There are no viable prospects left in the subscriber list.

Sponsorship-driven newsletters must have a nearly endless supply of new or more subscribers, new sponsorship relationships, or some mix of both.

Acquiring Subscribers

The good news is that acquiring new subscribers is relatively easy when you have money —like sponsorship revenue.

It is easy because the math is predictable. Let's keep the numbers small and the math simple as we make this point.

Consider a weekly newsletter with 100 subscribers. If the sponsorship sells for $10, each subscriber generates 10 cents per week in revenue. On average, a typical subscriber stays on this particular list for 75 weeks. Thus, the average subscriber's lifetime value is $7.50 (75 weeks at 10 cents per week).

This newsletter should be able to invest a dollar or two per subscriber, buying ads on social media platforms or in other newsletters. With new and more subscribers, the publisher can keep sponsorships going and growing.