They have quickly become a profitable endeavor for publications. According to a report from Neiman Lab, editorial email strategies have a return on investment of 45 to 1. This means for every $1 invested in email newsletter services, they make $45 back. The Wall Street Journal, Bloomberg, Business Insider, Fortune, now offer newsletters to subscribers. The New York Times recently put 18 newsletters behind a paywall to compete with similar offerings on other sites.
What was once an auxiliary benefit is now a key driver of subscriber growth. This move from legacy outlets is in part a response to Substack, an open publishing platform. Substack is not quite like any publisher before it. You don’t need to be an accomplished journalist, just an email and an opinion.
What is a Substack?
We all have that one thing we’re an expert in. One specific topic we could talk about for days. It used to be the only way to showcase our knowledge was to talk the ear off the person closest to us until they got tired of listening. Substack provides an outlet for experts in any field to write about their field of choice.
At its core, Substack is an online publishing platform that allows authors to create newsletters and send them directly to the inboxes of subscribers. Their users include journalists, large media companies, and experts – and laypeople. Substack provides payment, analytics, and design features to its content creators (customers). Authors have the ability to hide their content behind a paywall or allow free access.
What does content look like?
Substack newsletters cover almost any topic. From finance and banking, and investment strategy, to career advice, nutrition and lifestyle tips. The writing usually has the feel of a blog post but there is no required format. Frequency depends on the author – some appear once a month, others every day.
While you don’t have to be a Pulitzer Prize winning journalist to create a Substack, Glenn Greenwald and Alex Raskin are there. For journalists, Substack offers freedom. There’s no permission from an editor to publish. It’s also a possible escape from the deluge of pitches that come from PR folks to writers at legacy outlets.
Let’s look at a couple examples.
Edwin presents research on problematic public companies. He discusses which stocks to short and buying put options alongside flags to watch when it comes to corporate governance. Edwin is a recent graduate from Stanford University (class of 2020). He doesn’t have a long career as a journalist or any awards, yet has over 48,000 followers on Twitter. A good proportion of his fan base is willing to pay $44 a month for his premium newsletter – more than the cost of a subscription to the entire New York Times.
Sam’s newsletter is a compilation of top news stories related to the economy and stock market. The longtime Business Insider and Yahoo! Finance reporter sifts through daily stories to deliver the most important information for his readers, helping them stay informed and make better financial decisions. While Sam is an established and accomplished journalist, he joined the platform because he saw an opportunity. He felt that news publications put too much emphasis on creating daunting, eye-catching headlines rather than providing context. That analysis is what he brings to TKer.
What impact will this have?
Substack has the capability to change the landscape of journalism. We’re already seeing this play out with more companies establishing their own email newsletter platforms to rival Substack’s offerings. What makes Substack different is accessibility and freedom for creators. This type of editorial freedom is a big appeal for the site and one that may be more difficult for top publications to replicate. Watch for more established journalists starting their own Substack.
For the world of PR, this may expand the number of “journalists” we can look to build relationships with and pitch stories. As Substack newsletters grow in popularity, we will have to pay more attention. The largest Substacks may eventually rival the numbers of the major publications. In the meantime, keep an eye out for newsletters you think have the chance to grow, as you may be asking them to feature your company one day.
Elia Levitin is an account executive in Cognito’s New York office