By Don Nicholas • 02/16/2009
How email newsletter contact frequency affects the annual value of email newsletter subscribers
The online metrics of making your email newsletter yield more revenue
If he had been a consultant to our industry, the legendary Peter Drucker probably would have said something pithy like “measure your email revenue right, and measure the right email revenue.”
A Mequoda online publishing and marketing system measures revenue produced by email newsletters differently from the way that print publishers have traditionally measured the lifetime value of a subscriber.
So, how do you calculate the revenue a Mequoda System makes in a year? And when does it make sense to increase the frequency of your email newsletter?
Here’s the short course, and a clue as to why Mequoda Daily is poised to increase the frequency of its email newsletter to five times weekly.
Based on the 15 Mequoda Systems we have built for my consulting clients that were live for all of 2008, the average email newsletter had about 100,000 active email newsletter subscribers who are all potential paying customers.
The 15 email newsletters had circulation ranging in size from 3,500 to 210,000. These email subscribers pay nothing for their newsletters directly but monetize themselves by buying all manner of products and services that sponsor their email newsletter.
Many of these products and services carry the same brand as their email newsletter. The Mequoda Summit for example is the premiere sponsor for Mequoda Daily.
How much is each email newsletter subscriber worth?
The answer to that question is a function of contact frequency.
If you can average $50 in revenue per 1,000 emails sent to your email newsletter subscribers, and your contact frequency is daily (five mails per week), you’ll generate an average of five cents per subscriber every time you mail. At five times a week, that amounts to 25 cents per week or about $13 per year for every email newsletter subscriber.
So, if your average value per subscriber is $13, and you have 100,000 subscribers, your Mequoda publishing system is grossing $1.3 million annually.
Based on our experience with about a dozen Mequoda consulting clients for whom we have a full year of metrics, that’s about average. They range in revenue from $150,000 to about $3.5 million.
The revenue per subscriber for Mequoda Daily in 2008 was about $60, based on its current, three-times-weekly contact schedule. For most of 2008, we ran three email newsletters per week, which always include links to premium Mequoda information products.
The straight math suggests that if you generate $60 per subscriber per year based on a three-times-weekly contact schedule, you should be able to generate $100 per subscriber per year based on a five-times-weekly contact schedule.
However, this plan only succeeds if you have sufficient products to offer your loyal email newsletter subscribers. Plus, you need the online copywriting horsepower to create sufficient, engaging editorial content.
Mequoda Daily gets a new premier sponsor – Mequoda Pro
Between our new Mequoda Pro membership website, and the twice yearly Mequoda Summit, we believe we have enough premium product and related content to increase our average revenue per Mequoda Daily subscriber to $80 per year for 2009.
We don’t expect a straight, linear increase from $60 to $100. We expect the increase will be something less than that, but nevertheless substantial.
With Mequoda Pro, we have a brand new product — the ultimate publishing answer machine — designed exclusively for experienced online publishers, editors, marketers and webmasters who need 24/7/365 fast access to their toughest questions when they need them.
Mequoda Pro Members can ask any question about online publishing and marketing, and receive a detailed answer from me and the other members of the Mequoda Pro Research Team. Plus, Mequoda Pro Members get unlimited access to all eight Mequoda Pro Video training modules online. The special introductory price is only $197 annually.
Our other premiere product is the Mequoda Summit, a two-day conference that explains, in detail, the best practices for starting and running a profitable online publishing business. The program was a sellout in 2008, with a total of about 130 publishing professionals attending when we increased the frequency of the event to twice yearly.
The price of admission to the Mequoda Summit is now $1297. If you want to attend the bonus, one-day, SEO workshop, it’s just $497 more.
Even though the country is in the midst of an economic recession, most print publishers recognize that creating an effective online publishing and marketing program is not an option, if they want to survive in a Web 2.0 world. And with the barriers to entry lower than they have been any time in history, entrepreneurs are launching new Mequoda Systems at an ever increasing pace. We’ll help launch six new ones in the first six months of 2009 and cover dozens more right here in Mequoda Daily.
As I write this, registration for the forthcoming Mequoda Summit, is ahead of last year. So, we believe we have the depth of products to support our increase in customer contact frequency.
What about your email newsletter contact frequency? Does it make sense for you to increase the frequency of your email newsletter in 2009?
Posted in Multiplatform Publishing Strategy