Different monetisation methods

Welcome to the very first edition of Revenews (a smarter man might say the Revenewsletter).

🇬🇧 Firstly, yes I am British, so if my American friends are confused about some ‘spelling errors’, it’s because I’m actually speaking proper English…

Transatlantic digs aside, lets dive in! 🚀

1. Different monetisation methods and my 3 biggest tips

2. Newsletter News

3. Inbox Banter

^{What are the different ways to monetise your newsletter?}

Broadly speaking, I see 5 main ways to approach generating newsletter revenue.

1. Sponsorships/ad sales (my favourite & the main focus here!)

2. Selling your own products or services

3. Premium content

4. Selling data & email addresses

5. Affiliate marketing

🔎 Now let’s zoom in…

🥇 Sponsorships/ad sales

The main revenue model for most of the big newsletters, such as Morning Brew, 1440, and The Daily Upside. Fundamentally, this involves selling advertising space to brands, ideally, in exchange for an upfront fee.

The most common questions I get from people about ad sales are:

• Where are the best places to find leads?

• What’s the most efficient outreach channel?

• How do you structure your outreach?

• What type of brands should I reach out to?

• How much of the process can you/should you automate?

• What’s the best way to manage client comms?

• Can/should I sell other channels as packages?

• And so on. Each of these could command their own newsletter to be honest, and they will.

Why it’s a scalable revenue channel

The amount you can charge per ad depends on; subscriber numbers, engagement rates (clicks/opens) and how niche or powerful your audience is. Once you’ve figured out how to excel in any one of the previous elements, you can start selling high ticket deals and you’ll have a serious sales organisation on your hands. I personally know newsletters with ~20k subscribers that earn as much newsletters with 500k. Simply because their readership is so niche, powerful, and/or in-demand from affluent advertisers.

3 Pros 👍

• It’s pretty scalable, whether you’re super niche, or general news.

• It’s an efficient use of resources. Direct sales will (most likely) drive much higher numbers per ad slot/subscriber versus affiliate, CPC agencies, or ad networks.

• It can lead to long-term, repeat client relationships which become very lucrative.

3 Cons 👎

• Outbound sales is (very) time consuming and not for everyone.

• Marketing budgets for tests/new channels are the first things to be cut in tough economic times.

• If you intend to remain a solopreneur, you’re going to struggle to sell out multiple ad slots per week (in addition to writing, growth, etc.).

If I had to choose 3 of the most important principles for successful ad sales…

1. Invest in quality subscribers! Which, of course requires valuable content. Without engaged readers, your campaigns are likely to perform poorly most of the time, thus repeat business will become an uphill struggle at best. Generally speaking, new business deal sizes are much smaller than repeat campaigns, especially if the first run went well. If you want a profitable, sustainable revenue machine, that won’t require burn out every month, invest in quality growth.

2. Yes, make the outreach process as efficient as possible, but don’t automate everything. There are certain stages of the prospecting or outreach that make sense to outsource or automate, such as web-scraping for leads, templated sequences, etc. HOWEVER, keeping human personalisation in key area’s will increase effectiveness, reply rates, and the quality of the relationship you build. Outreach automation is a huge topic that I intend to cover soon with some automation experts.

3. Sales is hard, so start early. Don’t be surprised if 5 or 6 deals in a row fall through, even good sales people have a conversion rate of 20%. By starting early you’ll have 2 initial advantages;

   a) The founder effect, higher conversions rates because people like talking to higher-ups, use this to start conversations that future salespeople will find MUCH more difficult.

   b) Lower prices (i.e. less subscribers) will give you the advantage of low or no-risk marketing budget decisions. If you’re asking for $700, a marketer is likely to say, ‘fuck-it, if it doesn’t work it doesn’t really matter’. This advantage will diminish gradually, closing deals seem to become harder at ~$3,000, and again at $10k. Use it of lose it!

🔒 Premium content

In a nutshell, this is offering more content, of a higher quality, quantity, or more practical format, for a monthly/yearly fee.

The key here is to be in a niche that (a) can afford paid content, (b) will see real value, and (c) have a nice organic way of promoting the paid option within your free content.

Two good examples are, Justin Gordon @ JustGoGrind and Jack Raines @ Young Money.

🫣 Selling data & email addresses

This is one of the more morally-dubious options, less common but can be very lucrative. Personally not a massive fan of this one, but hey, there’s no judgement here.

Just make sure that your local regulations allows you to do this and you’ve acquired the relevant permissions.

🖇️ Affiliate marketing

This includes joining affiliate/referral schemes for strategic brands and promoting them in your content. This is a less favourable and dependable revenue stream than ad sales. I do however, think a lot of newsletters shun affiliate schemes, when it has the potential to be an efficient source of ancillary revenue.

🐣 Selling your own products or services

Courses, or downloadable information packs (e.g. marathon training plans) can be a fantastic, (relatively) zero cost, scalable revenue stream. That can add real value to readers, and complement your ad sales business.

One high profile example of this is Finimize. Whilst they do sell sponsorships for the newsletter, they also use it as a funnel for the Finimize premium app, as well as b2b content solutions.

The Hustle was acquired by Hubspot, ultimately to become a (very expensive) funnel for the Hubspot CRM. So there can be a lot of value in this model!

Newsletter News

🤝 Houck’s newsletter acquired another newsletter (link to post)

📈 Corporate ad spending continues to cautiously rise, although some reports show decelleration

🤖 Amid the AI funding boom, AI ad spending is UP, perhaps unsurprisingly. This also aligns with what I’ve been seeing colloquially in the market.

📊 An interesting article on how much of the yearly budget companies spend in marketing.

👏 Jack Raines’ sponsored LinkedIn posts are amazing (and viral!). A reminder to invest time and energy into creative & personal ads.

Inbox Banter

🤣 Beehiiv’s social media game is off the charts. I very much enjoyed this X thread.

Thanks for reading! I’ll leave you with the quote that pushed me to make to leap into entrepreneurship.