How local newsletters can thrive on Substack
The Charlotte Ledger niched down, focusing primarily on the city’s business sector.
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How local newsletters can thrive on Substack
The first questions comes from Corey Hutchins
Which of the crop of local newsletters Substack seeded with grant funding last summer is most “successful” so far, why, and how should we calculate success?
Let’s start with some context: Back in early 2021, Substack called for submissions to its Substack Local program. It was targeted toward writers who operate local newsletters, and those who were selected would receive a number of benefits, the most important of which was up to $100,000 in cash. The cash would serve as a one-year advance on earnings, with the idea being that at the end of that year the publication would generate enough revenue in paid subscriptions to operate on its own.
In June 2021, Substack announced the recipients of these cash advances: 12 writers who hailed from different locales ranging from São Paulo, Brazil to Charleston, South Carolina.
Unfortunately, Corey, I don’t live in any of the cities that these newsletters cover, nor do I have any special access to their analytics or revenue figures. So it would be pretty difficult for me to rank them for you in terms of their success. (UPDATE: Several Substack Local fund recipients have provided insights in the comments section of this post.)
I don’t want to leave you empty handed though, so I’ll devote the rest of this answer to looking at a local newsletter that’s really thriving on Substack: The Charlotte Ledger.
It was launched in 2019 by Tony Mecia, a longtime journalist who had actually written for the Charlotte Observer for several years. What I like about the Charlotte Ledger is that it niched down, focusing primarily on the city’s business sector (it eventually expanded its coverage to other topics).
I actually published a Q&A with Mecia back in 2020, and you should definitely check it out since it goes through the newsletter’s origin story and the early lessons he learned while trying to grow the business.
But nearly two years have passed since that interview, so I wanted to check in with him again, both to hear about his progress growing the Charlotte Ledger and also to get a snapshot of its current-day offerings. Let’s jump into it…
What are all the business models today, and what's the pie chart breakdown of how much revenue they contribute to the business?
We did $226,000 in revenue last year, which is a 77% increase over 2020. We are pretty heavily dependent on subscription revenue, which last year accounted for 82% of our 2021 revenue. The other buckets are sponsorships (13%), my freelance projects/appearances (3%), and reader donations (1%). I think we are always going to be heavily dependent on subscriptions, and I like the alignment of our interests with reader interests, but we would like to continue to diversify our revenue sources. We are starting to move into events, too — we have a 250-person celebration this Thursday for our “40 Over 40” awards (more on that below), which should turn a small profit. We have also had smaller gatherings — a “beer with the editors” event last fall that had a good turnout, and a few smaller online forums (one on college admissions, one on travel).
As of today, we have a little over 12,800 on our total list, including about 2,100 paying accounts. We allow yearly subscribers to add one email address, which we comp, and we allow Premium members at $379/year to add up to 6 email addresses, so our total number of email addresses receiving the paid version is a little over 2,900. We have 50+ Premium members at $379/year, mostly companies.
Regular memberships (subscriptions) are $9/month or $99/year.
How many employees do you have? What are their titles?
We have two full-time employees: me (executive editor) and a managing editor. We use several part-time contractors on things like events, customer service, marketing, and office functions. We have hired a third full-timer, a reporter, who will start in June. We use a fair number of freelancers for writing as well.
What's the newsletter's weekly content output?
We now have four distinct newsletters: our main Charlotte Ledger (business/general, mix of free/paid, four mornings a week); Ways of Life (local obituaries, for paid subscribers only, 1x/week); Transit Time (local transit/transportation, free, 1x/week, partnership with local NPR station and local university); Fútbol Friday (on Charlotte’s new pro soccer team, 1x/week, free). So we are publishing seven times a week, plus any big breaking local news. It’s about 1/2 for paid subscribers, 1/2 open to all. It is almost all originally produced content, and we regularly come up against the email length limit, though we curate/aggregate in briefs at the bottom of the main newsletter. We try to cover stories that are not being written elsewhere, as opposed to writing about what everyone else is writing about. We find that readers want, and will pay for, exclusive and differentiated content.
Unlike other local media, which seem to want to push out as much as possible (and sometimes of questionable news value), we aim to do a smaller number of high-quality pieces. I think we are judged on our overall body of work, but I find that actual exclusive news tends to generate more conversions than, for example, features. (But we need both.)
Are there any recent big wins you want to highlight?
I would point to this week’s 40 Over 40 event as a win. It’s an award that we started giving three years ago to 40 people in the Charlotte community over age 40 who are making a difference — in business, education, healthcare, volunteering, etc. This is our first awards that we have been able to do in person, and we were fortunate to be able to secure seven corporate sponsors (including, critically, a bourbon supplier!). The event sold out at 250 people, and we agreed to give 10% of the ticket sales to a local charity. It will be a 1980s themed party with a DJ, dinner, and open bar. We have even hired breakdancers. So it’s an example of something that is good for the community, reflects well on us and helps get our name out there and allows us to make a little bit of money — representing a diversification of revenue for us. Just as we are showing that good journalism can be good business, we are also showing that doing something positive for the community can be good business.
Oh - I should mention (following another trend) we are also getting into games — we started a weekly Charlotte-themed crossword. (Making them free – more of a lead generation/engagement tool than a cash cow). We found a crossword constructor 90 minutes away, and he creates them for us using clues that Charlotte people would know. We have a sponsor for it that partially covers the costs.
Like everything else, it’s an experiment.
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The best acquisition channel for a paid newsletter
The next question comes from Kyle Carrozza
What marketing / customer acquisition channel(s) would be best to start with for a paid newsletter?
The best acquisition channel for a paid newsletter is your free newsletter. Very few people will convert to paid immediately, and most readers spend several months consuming your free content before they even think about taking out their credit card.
So that leads us to the next question: what’s the best acquisition channel for the free newsletter?
Well, results vary depending on the niche and format of the newsletter, but generally the best driver of newsletter signups is another newsletter. The readers have already built a habit of consuming content in the inbox, and they’re highly likely to trust the recommendations of a writer they read regularly.
How do you get recommended in other newsletters? Here are a few strategies:
Put simply, this is when you agree to recommend another newsletter to your readers if they do the same.
In general, many writers are open to these sorts of swaps, but you should be strategic about how you approach this. Generally, it’s a bad idea to recommend newsletters that aren’t actually very good, lest you lose the trust of your readership. You’d also want to find newsletters that operate in a similar niche to yours. A sewing newsletter recommending a crypto newsletter isn’t going to result in many signups.
Then there’s the question of size. It wouldn't make sense for a newsletter with 100,000 subscribers to do a swap with a brand new newsletter with only a few hundred. I’d recommend creating a spreadsheet that divides potential partners into tiers. As you continue to grow your audience, you can reach out to other writers with larger and larger audiences.
Finally, you could adjust your agreements to account for a disparity in subscribers. Let’s say you have 3,000 subscribers and you want to negotiate a recommendation swap with a newsletter that has 9,000 subscribers. You could offer to trade three separate recommendations for their one.
Interview other newsletter writers
A newsletter is more likely to link to you if you feature its author in some way. Appealing to someone’s ego works more often than not.
Advertise on other newsletters
You may have noticed that my last two sponsors were other newsletters. In fact, you’d be surprised by how many of the most successful newsletter businesses out there have engaged in paid newsletter sponsorships.
Here’s what I’d recommend: rather than running a generic call for newsletter signups, tease a piece of content that would be highly relevant to that newsletter’s audience. For instance, when Alexis Grant ran an ad in my newsletter a few weeks ago, she linked to three case studies she’d published that were specifically about media companies. That led to a higher-than-average click-through rate, and she probably got more signups than she otherwise would have if she’d simply pitched the premise of her newsletter.
How did an engineer who didn’t even listen to podcasts become the fastest-growing brand in children’s audio? I interviewed Jim Jacob about his plans to become the next Mr. Rogers.
Sponsorships come to OnlyFans. [Insider]
Media companies are suddenly getting excited about free content again. [LA Times] Related observation: BuzzFeed started seriously investing in video starting in 2012, and it's struggling to eek out $400 million a year across all its properties. PlutoTV started in 2013 and it's already up to $1.2 billion in revenue.
Spotify gets most the headlines, but SiriusXM has been laying down some serious coin over the last 12 months to expand its podcast operations. It's taking this industry seriously. [WSJ] From the article: "Sirius now owns a portfolio of social-media channels that Team Coco has fed with content for over a decade. The video clips distributed on these channels generated roughly $10 million in ad revenue in 2021"
Twitter launches new features for Super Follows [Social Media Today] This is a step in the right direction, but the Super Follows value proposition still isn't that great. I'm absolutely astonished that it hasn't occurred to Twitter to integrate Super Follows into a Revue newsletter subscription.
The Atlantic launches a book imprint [Publishers Weekly] I don't know why most national publishers didn't start doing this sooner. You put all this effort into nurturing writing talent and then allow that talent to publish their book content elsewhere?
Creators are collectively earning $12 million per year on Ghost. [Ghost] Ghost employs 31 people now and is generating $5 million per year.
CEO Will Hayward explains how the publication doubled down on original content and improved its marketing.
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