Newsletter advertising: the creator’s guide to growing your business through newsletter ads

Newsletter ads grow passive income for creators.

But what are they? And how can you start using them?

Today, we’re uncovering the what, why, and how of newsletter advertising. After reading, you’ll be ready to dive into the world of email ads.

What is email newsletter advertising?

Newsletter advertising is the process of placing adverts or sponsored content in email newsletters. This strategy helps position ads directly in front of a target audience and subscriber base.

Some people confuse email advertising with email marketing, but there are key differences:

1. Email marketing is when a brand builds its own email list. They usually manage elements like lead magnets, opt-in forms, newsletters, promotional emails, and more. With email marketing, brands always have access to their subscribers as they own their list.
2. Email advertising is when a brand leverages someone else’s email list. They pay to place ads in certain emails. After the campaign ends, they no longer have access to the subscribers since they don’t own the list.

Why creators shouldn’t overlook newsletter ads

Newsletter advertising benefits publishers and advertisers. No matter which side you’re on, here’s why you should consider email ads:

• Build passive income: Since you already write emails, email advertising lets you earn more money from the work you already do. No extra work required.
• Choose which brands you partner with: You have the power to choose which ads appear in your newsletter (if you decide to work with brands directly). Meaning you can work with companies whose values align with yours.
• Maintain authentic engagement: People join an email list because they want to receive updates. Since these people choose to stay subscribed, they’re more willing to interact with the content in your emails, which includes the ads. This engagement makes email advertising a valuable strategy for both advertisers and publishers.
• Keep subscribers happy with a privacy-led strategy: Email advertising uses hashed emails, which is where an email address gets turned into a special code to encrypt it. This means advertising doesn’t use cookies or invasive tracking. Subscribers appreciate this approach because it helps protect their online privacy.
• Expand ads beyond your newsletter: Your newsletter is what you use to share content and build rapport with your audience. But ads aren’t limited to newsletters. Other types of emails where you can place ads include lead nurturing sequences, welcome emails, or thank-you emails. Giving you plenty of opportunity to make extra income.

Remember: You don’t need to pick one side—you can use email ads as both a publisher and an advertiser.

The potential cost and earnings of newsletter ads

Before dipping your toes into newsletter ads, it’s wise to grasp the financials.

We’ll review how much it costs for advertisers to place ads in newsletters and how much you can earn as a publisher.

How much does it cost to advertise in newsletters?

Newsletter advertising rates depend on several factors. For example, audience size, engagement rate, industry, and more.

However, we’ll run some average calculations so you can get an idea of how much newsletter ads might cost.

CPM calculation

Formula: CPM = (Cost of Advertising / Total Subscribers) * 1,000

CPM stands for cost per mille. It’s essentially what an advertiser will pay per 1,000 subscribers. And while the CPM can vary across industries, advertisers rarely pay more than a $30 CPM, according to Influencer Marketing Hub.

For example, say you’re given an advertising rate of $75 per newsletter with 5,500 subscribers.

You can calculate the CPM to see how much you spend per 1,000 subscribers. In this case, it’s $13.64.

Then, compare this number with past campaigns or with an industry average to determine if you’re over or underpaying for newsletter ads.

eCPC calculation

Formula: eCPC = ((Total Subscribers/1,000) * Total Cost) / (Total Subscribers * Average Click Rate))

eCPC is the expected cost per click. It’s what you can expect to pay for every click on your ad.

To calculate eCPC, you need to ask the publishers for their average click rate.

For example, say you’ve been quoted $100 to advertise on a newsletter with 5,000 subscribers, and the average click rate is 3.5%.

If we plug those numbers into the above formula, we get $2.86/click.

Use this number to determine if those costs align with other advertising costs. For example, you might find that you pay more per click through Facebook ads, making email advertising an economical advertising option.

Note: You can use the same formula to calculate the CPC after running your ad campaign. Just swap out “average click rate” with the actual click rate of the campaign.

eCPA calculation

Formula: eCPA = Total Cost / Estimated Number of Conversions

eCPA is the estimated cost per sale or lead. To calculate this metric, divide the estimated number of conversions by the cost of your ads.

You can estimate how many conversions you expect based on the past performance of your landing page paired with the average click rate of the newsletter.

For example, let’s say your landing page converts at 3%. And you expect to get 100 clicks from your newsletter ads. This gives you an estimate of three sales. If you paid $30 for your campaign, the eCPA would be $10 per sale.

Calculating this metric helps you estimate if your campaign will be profitable (and if you should move forward with the partnership).

Note: After running your ad campaign, you can use the same formula to calculate the CPA. Just swap out “estimated number of conversions” with the actual number of campaign conversions.

How much can you earn displaying ads in your newsletter?

As we’ve already mentioned, newsletter ad earnings vary. But you can calculate a rough estimate based on varying CPMs.

Example of a potential revenue calculation

Let’s look at a few different scenarios based on different numbers of subscribers and $15 and $30 CPMs.

As you can see, placing ads in your newsletter can be an easy way to make money every time you hit send.

Different methods for advertising in newsletters

There are three approaches for placing ads in newsletters:

1. Programmatic ads
2. Newsletter marketplaces
3. Direct collaboration

You can choose to stick with one method or use several. Let’s take a closer look at each one:

1. Run programmatic ads

Programmatic advertising is an automated process of buying and selling targeted ads which creates a provide a steady source of passive income for the publisher.

For example, say a pet company wants to promote their products. By working with a programmatic advertiser, they can place their ads in relevant newsletters (like those from pet bloggers) automatically.

Programmatic ads are fairly hands-off and efficient. Once you set up programmatic ads, you don’t need to do much else.

But they also give you less control over which newsletters display your ads. And publishers can’t set their own rates.

However, the tradeoff is often worth it, and creators and publishers enjoy the ability to grow their businesses on autopilot.

Best programmatic ad networks

If you want an automated way to run ads in your newsletter, consider one of these platforms:

1. LiveIntent
2. BuySellAds
3. Passendo
4. Gold Lasso

2. Explore newsletter marketplaces

Newsletter ad marketplaces connect buyers with sellers. Brands can search the marketplace and browse publisher profiles to find a newsletter that fits their goals.

And publishers can create a profile in hopes of connecting with a brand.

With marketplaces, publishers set rates and availability. This gives them slightly more flexibility compared to programmatic ads.

But it’s also more time-consuming than programmatic ads. And some marketplaces require participants to pay a percentage of the advertising rate.

Best newsletter advertising platforms

• Paved
• Hecto

3. Work directly with publishers/advertisers

The most time-intensive method to place ads in newsletters is directly approaching who you want to work with—also known as direct ads.

If you’re a creator, make a landing page outlining your newsletter (like audience demographics, advertising opportunities, and rates). Then, include your landing page when you pitch to potential advertisers.

And if you’re an advertiser, reach out to popular creators in your niche with your proposal. Tell them how many ads you’d like in each newsletter and how many newsletters you’d like to advertise in.

Although direct collaboration takes more time, advertisers and publishers have total control over the outcome. Including who you work with, where you place the ads, and how much you pay/charge for ads.

Like marketplaces, this method isn’t scalable, but it can be a suitable option for those looking to test the waters.

What programmatic newsletter ads look like

There are two main types of ads to use for newsletters: Display ads and native ads.

Display ads are banner-type ads in your newsletter. Readers can easily identify them as ads since they stand out from the rest of the newsletter content. Like this display ad from publisher The Content Technologist.

Since banner ads “feel” like ads, they tend to get fewer clicks than native ads. Native ads blend in with the newsletter’s content. They may take on the branding of the newsletter and look less like an ad than display ads.

Often, these ads are labeled as “sponsored” or “ad.” This ensures readers know that what they’re looking at is an ad, like this one from publisher The Peak:

As for where you can place display or native ads, there are generally three different places:

• Newsletter header advertising: Header ads are the first visual subscribers see. As such, they typically cost more since they get the most eyeballs.
• Newsletter mid advertising: Mid ads appear throughout the newsletter, typically somewhere in the middle.
• Newsletter footer advertising: Footer ads appear at the bottom of the newsletter in the footer area. They tend to cost the least since the reader might not scroll all the way to the footer (and could miss the ad)

Best practices for newsletter ads

Whether you want to buy ads or get paid for them, these tips will set you on the right track.

Tips for creators buying email newsletter ad inventory

Target specific audiences

To get the most bang for your buck, place your ads in newsletters that target the same audience you do.

And if you’re working with a creator directly, ask if they segment their email list. Email segmentation is when a publisher categorizes their subscribers based on specific criteria, and it can help you reach a highly targeted audience.

For example, a food blogger might have a list of 10,000 foodies. But they might segment their list even further. Like people who want vegan recipes. And people who prefer sweet over savory dishes.

These segments can help you further drill down to who you want to reach, making your ads even more effective.

Craft and design a high-performing newsletter ad

When designing your ad, keep in mind that most people read emails on a mobile device.

To keep ads legible, remove unnecessary text and keep them simple. Otherwise, people might find them challenging to read on smaller screens.

And use high-quality imagery to capture your audience’s attention.

Lastly, include a clear CTA that tells readers what to do, like purchase a product or sign up for your email list.

Direct all ad clicks to a dedicated landing page

Create a landing page for people who click your ad. The landing page should reflect your ad and allow people to complete your CTA.

For example, if you ask people to sign up for your email list, you want to direct them to a landing page with a visible opt-in form so they can easily subscribe.

With Kit, you can craft landing pages even without a website in a matter of minutes—no fussing around with code.

Tips for creators displaying advertisements in their newsletters

Be sure newsletter ads are the right choice for you

Newsletter ads can provide a great source of income, but they might not be right for you. For example, if you have a small subscriber base, the income from email newsletter ads might not be enough to make the ads worthwhile (yet).

However, there are still other ways to earn money through your newsletter.

Other ways to earn money with your newsletter

• Paid newsletters: Paid newsletters provide consistent recurring income. And they work great, no matter the list size. With an average price of $11 per month (per paid subscriber), you can add a sizeable chunk of change to your monthly revenue via a paid newsletter.
• Newsletter referral programs: A newsletter referral program can help you sell more products and grow your list faster (so you can eventually place ads in your newsletter). Referral programs reward subscribers who get you signups. They’re a hand-off way to grow your list and reward the people who help you do it.
• Digital tip jars: Adding a digital tip jar to each email you send lets you grow your income without selling products or using ads. Subscribers choose how much they want to “tip” you for putting together your useful newsletter.

Number of ad placements per newsletter

Although more ads equals more revenue, you need to strike a balance between user experience and ad density. Too many ads and your subscribers may unsubscribe, or worse, mark you as spam.

Too few ads, and you might earn enough money.

Using programmatic advertising helps solve this issue. When you partner with an industry leader who knows the ins and outs of ads, they can tell you exactly how many ads you should place in each newsletter.

If you plan to manage the ads yourself, keep an eye on your unsubscribe rate to see how many ads your subscribers will tolerate. If your unsubscribe rate shoots up, you likely need fewer ads.

Give your newsletter audience a way to opt out of the ads

Rather than lose subscribers over ads, give them a way to opt out with two options:

1. Set up a paid ad-free newsletter
2. Create a free newsletter (with no ads) that you send out less frequently

Explain to subscribers that ads fund your content creation. They may be happy to support you if they know the positive impact the ads have on your business.

Start your newsletter advertising today

There’s no denying the impact ads can have on your business.

And with Kit, you can build a landing page to advertise yourself as a publisher or send traffic to from your ads.

Want to give it a go? Build a free landing page with Kit and grow your business with newsletter ads, today!