How to Build and Sell a Newsletter
The Authoritative Guide for Creators, Entrepreneurs, and Anyone Seeking to Make Money With Curated Content
When it comes to making money online the name of the game is attention. What if instead of chasing a click through rate of less than 1%, you could achieve an engagement level more than 7 times that?
Email marketing continues to produce steady, efficient results year after year. A recent 2020 study from Constant Contact found that nearly 1 in 5 marketing emails were opened. And at the heart of a well-rounded email marketing campaign?
The humble newsletter.
Well, hardly humble. The newsletter business model sits at the center of the email marketing industry, projected to be 18 billion dollars by 2027.
But how to tap into that mainline of cash? How do you start a newsletter business? How does one come up with newsletter ideas? How do you take newsletter business ideas through infancy, build them, monetize them, and then, sell your newsletter?
It is worth exploring the answers to these questions and more. Let’s look at the newsletter business model and how newsletters make money.
- How to Start A Newsletter Business
- How to Grow Your Newsletter
- How to Sell Your Newsletter
How to Start A Newsletter Business
The first thing to know is there is a long, rich history of successful newsletters. That history fosters a thriving marketplace. That should provide some peace of mind for when you go to list your newsletter business for sale.
The Newsletter Business Model
The newsletter business model is simple. That’s what makes it such an attractive business.
A newsletter is curated content that builds a relationship with the reader.
A newsletter is a promotional vehicle for selling something else. Be that advertisements, attention, ideas, whatever, the newsletter itself is a monetizable delivery system.
The newsletter’s job is to capture attention. That’s how you stay top of mind. Then what are the newsletter business ideas that drive engagement?
Newsletter Business Ideas
When it comes to newsletter business ideas there are a few basic types. Which one you choose to build will depend upon your monetization strategy.
Letter From the Editor
The letter from the editor (publisher) is the shortest and most direct model. For this newsletter idea, your issue will feature one main article or story that the newsletter will introduce. This works well if you are looking to promote one major product, service, or idea.
This is designed to be consumed during idle periods in the day. Get this format right and you’ll be a trusted quick read which is always a solid way to increase newsletter open rates.
The blog style is less a stand-alone offering as it is a companion piece to a larger repository of content. The blog-style newsletter idea is less concerned with the original content within the newsletter itself than it is with the delivery method.
This model is used to get your message into the pocket of your reader. From there you can drive traffic to a host of other pieces of content that are designed to do the informative heavy lifting.
The Content Curation newsletter idea is like the blog style newsletter but takes it a bit further. Instead of distributing a lot of your own content, the content curation model rounds up and distributes other people’s content.
Instead of writing an entire blog post on a topic, you can write a few sentences about what other experts are sharing.
This model is primarily monetized by selling or promoting affiliate products for a commission.
E-Mail Newsletter Tools
You can’t build a newsletter business without quality distribution. The following tools will manage your subscriber list, your content distribution, and will provide necessary metrics like newsletter open rates.
Mailchimp is the 800lb gorilla in the email space with nearly a 70% market share. They have a strong free plan. If you’re starting out… start here.
As a relative newcomer on the scene, Substack is still gaining traction but is doing so quickly. They offer an easy way to grow an audience and quickly monetize a newsletter through a subscription-based model.
Other Software to Explore
How to Grow Your Newsletter
Now that you’ve decided on what to write and send out in your newsletter, the focus becomes making sure that someone is actually reading what you’re writing.
Strategies to Grow Your Newsletter, Newsletter Open Rates, and Gain Subscribers
Focus on adding value with good, high quality, content. Lackluster content has the potential to torpedo your newsletter.
Focus on Your Subject Line
You’ve only got one chance to make a first impression. You’ve got to find a way to cut through the noise with your subject line.
We can borrow strategies from adjacent industries to increase engagement. There are a number of tools that can help analyze the likelihood an email will be opened. You can also use tools that analyze the sharability of a blog post’s headline.
The big winner in boosting the newsletter open rate is personalization. If you can tailor the subject line to your reader, studies have shown an increased open rate of 26%.
Show Up Consistently
If you want to increase your open rates and stay top of mind, keep showing up.
Depending on industry or niche, plan on checking in with your audience on a weekly basis. Sometimes more if your newsletter is particularly news cycle driven, but generally the rule of thumb is to be consistent without being overwhelming.
You don’t want to smother or take over someone’s inbox. That’s just not quality relationship building now, is it?
A lead magnet is anything of value the publisher gives a reader in exchange for their email list.
A micro course or 5 day email challenge is an excellent way to grow a newsletter in 2020 and beyond. A mini-course has distinct advantages when you’re trying to grow a newsletter audience who will open and engage with your newsletter emails.
First, by delivering five consecutive days of valuable content that builds on the previous day, you’re able to showcase your voice. The audience is checking back in around the same time each day to read what you’ve sent for the next day’s sequence.
Remember, you’re building relationships with the audience. Giving value. Showing up consistently. Letting the reader get used to your voice. These are all aspects that build trust with the reader and let them get to know you.
Once that rapport is established, they’re more likely to read what you’re sending beyond the mini-course they signed up for.
How to Monetize Your Newsletter
Once you’ve got readers signing up for your newsletter and they’re opening your emails, then it is time to make sure you know how your newsletter makes money.
Newsletters have been set up to elicit donations since the beginning of the industry. Nonprofits and politicians still thrive on this monetization model. It may not seem completely intuitive at first, but this is another way to gauge your audience’s engagement.
If you're providing value there’s nothing wrong with asking your audience to take the next step along the value journey with you.
A subscription is the next level of audience commitment. You’re no longer asking your audience to come along with you on the journey. Now they’ve got to chip in for gas.
Subscription-based newsletters are particularly effective on Substack. Start small with a “freemium” model where some of the delivered content is available for free while the premium content lives behind a paywall.
You can be selling your own products and services or you can be promoting other products through affiliate links. The key here is not to let the promotional material within your newsletter overwhelm your value add content.
Joining an ad network to inject ads is just like how a website does it. Again, just don’t go overboard.
A particular post or section of content may be considered "sponsored" if it is commissioned by a single advertiser and woven into the content itself. This is akin to an infomercial.
It should be noted that sponsored content must be clearly declared as to maintain integrity with your readers.
How to Sell Your Newsletter
Now that you’ve got a thriving newsletter business, it’s time to start thinking about an exit strategy that maximizes your return on investment.
How to Sell Your Newsletter on LetterXchange
Selling a newsletter on LetterXchange is dead simple. We’ve worked diligently to foster an active buying and selling marketplace to garner the highest price for your hard work.
Step 1 - Sign up for an account. It's free.
Step 2 - Create your newsletter listing.
Step 3 - Receive offers from potential buyers on your newsletter listing.
Step 4 - Select the offer of your liking and close using a secure third-party escrow service.
That’s it. Easy peasy.
Let’s dive into creating a listing that sells.
What’s in a Listing
A listing is merely a solicitation. An offering. A declaration that says “this is what I built, and here’s how it can benefit you.”
The listing needs to be written for the audience, the potential buyer. They are looking at dozens of listings so yours needs to play to their pain points and contain everything they need to make a buying decision.
It should be short and scannable. It should have all the numbers right in the listing and shouldn’t hide any bad news.
At a minimum a listing must include:
- The pitch - What the newsletter is about.
- The number of subscribers.
- Current open rate.
- Target Audience
- How often the newsletter is published.
- The platform or delivery method for the newsletter. What software and tools does it use?
The pitch is your narrative of what your newsletter is all about, why people should sign up, and ultimately, why someone should buy it off you.
How to Write a Pitch
The first mental frame you’ve got to firmly plant yourself in when writing a pitch is your target audience. You have to empathize with them and speak to their pain points.
What is my unique selling proposition and how is that going to help someone else make money?
What may have started out as a labor of love for you now needs to shift focus to making someone else (anyone else) money.
If you’re delivering a real estate newsletter, what’s special about yours? What’s driving your open rates? How strong is your community around your newsletter? How engaged is your audience? What do you know about them?
How to Price a Newsletter
Once you’ve got your newsletter built, it’s time to figure out what it is worth. Luckily, as with most alternative assets, the models are fairly straight forward.
The Newsletter Pricing Models
The primary model for pricing a newsletter, or any alternative asset really, is to
- Determine what your actual periodic revenue is, and
- Determine what your multiplier is.
LetterXchange has built a useful valuation tool to help set pricing expectations for your specific newsletter.
This sets a floor for your pricing expectations but is not the only way to look at newsletter value.
The second method is a bit fuzzier and works better for newsletters that have solid metrics but don’t necessarily translate to steady, predictable income as a subscription newsletter would.
You’re selling the speculative potential of your audience. You’re selling the possibility of what they might do based on their history, their demographics, what they like, and generally what you know about them.
While it’s difficult to pin a hard number to this pricing model, doing so can provide more value. You are building an intimate relationship with your readers, so you’re in a unique position to try and quantify their subjective value.
I hope this is enough to get your feet wet and see the near boundless potential of the newsletter industry. While this should be enough to get your feet wet it’s by no means the end of the conversation.
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