dark side of newsletter sponsorships

As you may know:

This publication is not the only email newsletter I operate.

My other newsletter is a traditional newsletter called The Freelance Gig.

Inside, we share news, tools, tips and tricks for freelancers looking to grow their business.

And our main monetization strategy is sponsorships.

Now, some of our sponsorship deals have come from inbound requests…

Others have come from us cold emailing brands…

But many of them have come from Beehiiv’s native Ad Network.

This is where Beehiiv presents you with sponsorship opportunities on a silver platter.

All you have to do is say yes or no…

Then decide which creative you want to run and when you want to run it.

Not bad, innit?

Now, that said, because these sponsorships are hand-delivered to you with a bow on top…

They don’t exactly pay out at top tier rates.

Fair enough.

However, up until recently, they still offered a respectable way to monetize your newsletter.

Looks like those days may be numbered, though.

Because I just saw this:

As you can see, this sponsor is offering $10.40 per 1,000 opens.

Yet here’s the thing:

Previously, they were offering $2 a click…

Which allowed us to bank a solid $100-$150 per send to our list of 12,000+ freelancers.

But now?

With a 50% open rate, we’ll top out at $62.40 if we’re lucky…

Effectively cutting our earning potential in half.

Super.

Unfortunately, this is the dark side of newsletter sponsorships.

Most of them are calculated on a CPM (cost per 1,000 impressions) basis like the offer above.

Which creates a hard cap on your earning potential.

(based on your subs + open rate)

And while you’re virtually guaranteed to top these numbers by negotiating your own deals…

In that case, you’d better be willing to cold email & pitch brands constantly.

Otherwise, you’ll be left with a lot of unsold ad inventory…

And even fewer shekels in your newsletter’s piggy bank.

In other words:

With sponsorships, your power to monetize is not totally within your control.

This is one reason why I’m so bullish on story-driven newsletters…

Where you monetize by selling your own products instead of someone else’s.

The economics are much more favorable to those with smaller email lists.

Plus, I don’t know about you, but…

I treat my life and work like a 3rd-world dictator.

I want as much control over them as humanly possible.

Not to be at the whims of platforms and sponsors who can choose to renegotiate terms whenever they feel like it.

Anyway, if you vibe with that…

Then you’ll definitely want to grab a copy of my upcoming Email Storyselling Playbook when it comes out.

It’ll show you how to duplicate the entire system for yourself for just a few bucks.

I’m hoping to release it before the end of the month.

In the meantime, enjoy your weekend :)

Jim Hamilton