Building a Community? Start with a Newsletter
(Photo Credit: Ari Lewis)
Last week there were two big announcements in the newsletter world:
It seems like the newsletter community has exploded in recent years. Publishers and creators are starting newsletters left and right. Every time, I log onto Twitter, there is a new newsletter — usually on Substack.
There's no reason not to write a newsletter. It's the perfect tool to start building a community. When you have a social media following, you don't necessarily own your audience. Just think about TikTok. The algorithm is so powerful that even if someone follows you, your account might not show up on TikTok’s FYP (I wrote about this concept in “YouTube is King … TikTok is Queen”). That's a best-case scenario. The worst-case? Your account gets deleted. That doesn’t happen with a newsletter.
For example, I start a weekly newsletter. When someone signs up for it, that means every week they are willing to give up a small portion of their time for me. And better yet, I own the relationship. I don't have to worry about something happening to my social media accounts or an algorithm changing. I write something and hit the send button to my list.
Owning a relationship is how you begin to build a community. Let's look at the Morning Brew acquisition. Business Insider isn't just buying a newsletter. It's buying a relationship with 2.5M readers.
Those readers don't only read Morning Brew but trust them. Look on social media. Readers of the Brew will include a coffee emoji on their Twitter. Morning Brew has built a community of readers in a way most publications including Business Insider haven't. You can't buy that type of loyalty. It needs to grow organically.
Now, look at Substack. They are building tools for anyone who wants to write a newsletter. In the past, if you wanted to start a newsletter, you needed to use an email service provider such as Mailchimp. You'd also need a domain and a landing page to collect email addresses. Substack does all this for you and more.
Anyone can start a newsletter in under 10 minutes. Better yet, if you want to add a payment option, just click a button and people can pay for it.
Twitter looks at Substack as a "Premium Twitter". If you want to monetize your Twitter account, Substack would be the best way to do that.
It's a logical extension of Twitter's monetization strategy. They wouldn't just have to rely on advertising. They would now be a "platform" for creators — taking a cut of every transaction that comes through the platform.
The best businesses figure out how to create direct relationships with their consumers. Newsletters are a mechanism for doing that.
What's even better is newsletters can turn CAC into net income. Credit to Craig Fuller for this:
What Does This Mean?
Most people look at content as a cost center. That's wrong, it should be a profit center. I want to stick with the Morning Brew example. If Business Insider wants to acquire more paying subscribers, it'll typically cost them money. Well, Morning Brew is an example of profiting off of a customer acquisition channel. Instead of Morning Brew costing Business Insider money, it'll make them money. How?
Morning Brew generates money on advertising. It produces $22M in revenue and $6MM profit according to an Axios report. Assuming no growth, it'll continue to make money for Business Insider but also produce a secondary benefit in converting Brew Subscribers to Business Insider subscribers.
Let's assume 1% of Morning Brew subscribers pay for Business Insider (yes, I know it's more complex) at the introductory offer of $69/yr. That would mean Business Insider just brought in an additional 1.72M in revenue while continuing to profit from a customer acquisition channel.
And this is why newsletters are becoming more popular than ever. Consumer attention is scarce. Just because a consumer follows you on social media, doesn't mean they engage with your brand. But a newsletter is different, they are letting you into their life. You are taking up a small part of their inbox.
There is nothing more powerful than a consumer saying I want to consume your content. I enjoy it. I am willing to give up a small portion of my week to read what you are writing.
So think about starting a newsletter for your brand or for yourself. It's the first step in building a community and owning the relationship with your audience. It's not a cost center, but a profit center. Every product company needs to be a media company and the easiest way to start is with a newsletter.
Post note: Some people might think there is a newsletter bubble. That isn’t true! Get off Twitter and the internet and speak to everyday people. I live in Cleveland. Most people I know haven't heard of Morning Brew or Substack.