One of the most important questions you’ll need to answer before you launch is:
“How much should I charge for this thing?”
Price theory is a complex subject. There are literally dozens of books, as thick as a brick, that you could devour and learn to wield complex math to arrive at the perfect figure.
Or, you could do what I do, and eyeball it.
In truth, the best price to charge for something is the highest price someone will pay. I would assume though, that it's a little more complex than that. While your mom might be willing to fork over $499 per month for your once-monthly letter, most of us aren’t going to be willing to.
So, then we can revise that statement to the highest price that many people are willing to pay.
To start off with, most paid newsletters charge monthly rates. Say, $10 per month for 4 issues per week, or 20 per month. That’s $0.50 per issue, per subscriber if you break it down.
The thing is, though, that subscribers churn. So one way to fight that is to offer yearly pricing and allow your readers to make a commitment upfront to pay for the full year in advance. If you’re charging $10 per month, you might consider a discount to the monthly amount for such a commitment, such as $100 per year. That’s a pretty popular option.
Since paid newsletters are kind of a newish thing there aren’t very many resources with publicly available information about pricing trends.
One resource we do have though, is Substack. It’s a platform for publishing your newsletter and getting paid — exactly what we want. But where they come in handy for pricing information is that they have a list of their most popular paid newsletters and their associated pricing.
I spent some time trolling through and creating a spreadsheet for some numeric insights. This is what I came up with:
All numbers based on the top 30 (or so) popular paid newsletters I could find (both on Substack and off).
The average price per month is $11.
The average amount of issues published per week is 3.5. That’s 14 per month.
That gives us an average value of $0.76 per issue, paid by the subscriber.
If you remove outliers, such as those that charge $29.99 and up per month, the adjusted number is $8 per month, and $0.57 per issue.
You might think that this means you can’t charge more than that. Wrong. I’ve seen many newsletter creators able to charge more than this for far fewer issues per month successfully without anyone batting an eye.
It’s just a range, and it’s helpful to see where you’re at on the pricing continuum.
Something this type of analysis doesn’t factor in is value and authority. Newsletters that help subscribers make more money (i.e teaching them how to better run their business or make more sales) will be perceived as more valuable. Which is a big reason why you could charge a much higher price per issue.
Authority also plays a big role in pricing. Writers with a higher authority, experience, and following would be able to get away with pricing their newsletter much higher than someone that isn’t at their level. For example, Ben Thompson charges $12/month for Stratechery, which is quite a bit higher than the average. His authority opens the door for this. As your authority in your niche builds, you’re also able to charge more.
The reality is that you’re not going to be able to read an article (such as this one) and walk away with the perfect pricing model. I wish it were that easy, I really do.
If you really want a takeaway, I say give $10 per month a shot. Try to publish weekly. See where that gets you. It’s all experimentation (and I do hope that you plan on experimenting) after that.
Your goal isn’t to nail the price on the first time, it’s to experiment and arrive at the proper price that your marketing, reputation, and content value supports.
Build it, tell people about it, and get feedback. Rinse, repeat.
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