This post begins by providing a comparative cost analysis of different newsletter platforms. The final section explains why you shouldn’t worry about that too much (but I needed to look at a cost breakdown before realizing it didn’t matter like I thought, so that’s why I put it first).
I. Picking A Newsletter Platform
If you’re thinking about starting a newsletter, you might be wondering which platform to use. Things like Mailchimp exist, but they aren’t full-service platforms (they don’t natively handle payments and membership system gating, etc etc). And you might be getting hung up on the different prices you’d have to pay.
This post is a quick overview of the fees for three services you can use for a newsletter, all with different features that should be considered:
The embedded Excel file below functions as a calculator. You can change the green boxes to see a comparison of fees that each platform will charge, and an audience size estimator.
Note: Unlike the other two, Ghost charges a monthly fee instead of taking a cut of earnings. It charges $29/month for its basic plan–if you pay annually. If you pay month-to-month, that goes up to $36.
II. Some general trends in the numbers:
- Each service has the same payment processing fee, so there’s no getting around that (not even if you build your own newsletter platform).
- The cheaper your newsletter, the larger the percentage you give to the payment processor. Why? Because every transaction is charged a flat 30 cents. 30 cents is a larger percentage of $5 than $6, and so forth.
- Fun fact: many of these platforms allow you to offer subscribers the option to pay annually or monthly, with the annual option usually offered at a slight comparative discount. Well, consider this: let’s say you offer your newsletter at $5/month ($60 total per year), or $50/year. While it’s true that the annual subscription is cheaper, it is only subject to one payment processing fee, while the monthly subscription is subject to twelve of them in a year. The payment processing fee is a percentage plus a flat rate–and the flat rate makes the difference. The monthly subscription pays $3.60/year in flat rates, the annual pays $.30. The annual option is still less revenue (if you discount it), but this is something to consider if you operate at sufficient scale.
- The final amount you pay for a platform is considerably higher than the advertised platform fees. Substack says 10%, Buy Me A Coffee says 5%–but you gotta add in the payment processing fee. It makes a big difference. (Buy Me A Coffee fee, Substack fee, Ghost fee)
III. Final thoughts, or Getting Over the Cognitive Barriers to Starting:
- If you haven’t started a newsletter yet, don’t let cost analysis paralysis stop you. You’re worrying about a problem you haven’t even proven yourself capable of having yet: how to most efficiently charge your paying audience. It’s better to start on a platform you like, and if you get to a point where you’ve grown your audience and want to start charging–then you can make your final decision. It’s pretty easy to migrate email lists across these platforms. But the important thing is starting and writing consistently and building an audience.
- I spent a lot of time not wanting to make a newsletter, because I really don’t like building anything via email (even if it works). RSS feeds are the better way, but the internet quite simply isn’t set up to make those a good universal method of communication–yet. Newsletters are, I think, the best entry-level option given what’s available to communicate with a large audience (things like Community are very promising too). So: if you don’t like newsletters/email, that’s OK. But if you want to write on the internet, then you either need to build something better or go ahead and use them for now (probably–if someone can convince me otherwise I welcome it). See this page for a future we can look forward to:
- Since I’m starting a newsletter myself, and I went through the whole “how do I keep more of my subscription money?” thing. Tweets like the one below made me stop and think even more (I recommend reading the whole thread).
- But where I ultimately landed was: I’m probably going to start with Substack, because I need to start, and because it has features and cultural ascendency. And I will continue to evaluate my other options as I go along. If I get to the point where I want to charge monthly subscription fees, or my audience balloons more than is likely, I will revise as necessary.
- In his newsletter, Michael Curzi writes about his Anti-Zombie protocol; commitments shaped like this can break down mental resistance to getting started. Here’s what he wrote about it:
- “I make a hard public commitment to post at least once a week for 3 months.
- This period begins now (late May 2020), and ends late August 2020.
- By August 31, I’ll re-up my commitment, change to another format, or explicitly freeze/shut down the mailing list.”
- There are a lot of ways to mix and match tools on the internet to get stuff done (google Zapier). For example: you can have a free Substack, and then in posts you can link to your Buy Me A Coffee profile for voluntary contributions–this could be an easy way to see if you have sufficient traction to look at a larger paid subscription model. Play around with your options, there is no right answer. Just what works best for you.
- Finally, the there are architectonic concerns about the nature of the internet to consider, and why owning your own means of communication is necessary (as opposed to relying on a platform that could de-platform you). I haven’t fully figured things out for myself here, so I merely point you to this post as a starting point for your own thinking.