Welcome, revenue builders!
Most newsletter creators struggle with one critical question when they're ready to monetize: What should I charge sponsors?
Today, we're breaking down how to price your sponsorships using CPM rates. Whether you're landing your first sponsor or wondering if you're undercharging, this is your comprehensive guide.
Here's what we're covering:
What CPM means and the five factors that determine your rates
A step-by-step framework for setting your pricing
Common mistakes that cost you money or deals
How your pricing should evolve as you grow
Let's get into it.
Price too high, and you'll scare away potential partners. Price too low, and you're leaving money on the table—or worse, signaling to sponsors that your audience isn't valuable.
Getting your pricing right isn't just about making money—it's about positioning yourself as a professional publisher who understands their value. Sponsors can smell uncertainty, and nothing kills a deal faster than a creator who can't confidently explain their rates.
When you understand CPM pricing, you can:
Enter sponsor conversations with confidence instead of anxiety
Defend your rates with data instead of hoping they'll accept
Know when you're being lowballed versus getting a fair offer
Adjust your pricing strategically as you grow
This isn't just pricing theory—it's the foundation of a sustainable sponsorship business.
Here's what I see happen constantly:
Newsletter creators either pull a number out of thin air ("$500 sounds good?") or they frantically Google "average newsletter CPM" and pick something from the middle. Then when a sponsor pushes back or ghosts them, they have no idea if they were too high, too low, or if pricing wasn't even the issue.
The real problem isn't just not knowing what to charge—it's not understanding why you're charging what you're charging. Without that foundation, every negotiation becomes guesswork, and you'll either leave money on the table or lose deals you should have closed.
Today, we're breaking down everything about CPM rates and sponsorship pricing:
What CPM actually means and how to calculate it
The typical CPM ranges for different newsletter types
The five factors that determine what you can charge
How to set your rates using a practical framework
Common pricing mistakes that cost you deals or revenue
When to charge more and when to hold firm
By the end, you'll have a clear, defensible pricing structure based on real factors—not guesswork.
Let's dive in.
CPM stands for "cost per mille"—basically, the cost per 1,000 subscribers who will see a sponsor's message.
Here's the simple formula:
CPM = (Sponsorship Price / Number of Subscribers) × 1,000
So if you charge $500 for a sponsorship and have 10,000 subscribers, your CPM is $50.
But here's where it gets interesting: CPM is just the starting point for your pricing conversation. It's not the whole story.
The CPM Range You Need to Know
Newsletter CPM rates typically fall between $15 and $100+, depending on several factors we'll cover in a moment.
Here's a rough breakdown:
$15-$30: General interest newsletters with broad audiences
$30-$60: Niche newsletters with engaged, specific audiences
$60-$100+: Highly targeted B2B newsletters in lucrative industries (fintech, SaaS, marketing, etc.)
I've seen newsletters command $150+ CPMs when they hit the sweet spot of highly engaged audience + high-value niche + proven conversion rates.
But these numbers mean nothing without context. Let's talk about what actually drives your CPM.
1. Audience Quality Over Quantity
A newsletter with 5,000 engaged VP-level executives in tech will command higher rates than a newsletter with 50,000 general consumers.
Why? Because the value of reaching the right person far exceeds the value of reaching more people.
What sponsors care about:
Job titles and seniority of your readers
Industries they work in
Geographic location (US/UK audiences typically command higher rates)
Purchasing power and decision-making authority
If you're sending to marketing directors at mid-size companies, you can charge more than if you're sending to college students interested in marketing.
2. Open Rates Tell Half the Story
Everyone obsesses over open rates, and yes, they matter. A 40% open rate is better than a 20% open rate.
But here's what's more important: engaged opens.
Sponsors don't just want eyeballs—they want readers who actually consume content and take action.
What to track and share:
Average time spent reading your newsletter
Click-through rates on your content links
Reply rates and community engagement
How many people read to the bottom of your issues
A newsletter with a 30% open rate where readers actually engage with content is worth more than a 50% open rate where people skim and delete.
3. Niche Specificity Multiplies Value
The more targeted your audience, the more valuable it becomes to the right sponsors.
A newsletter about "productivity" is broad. A newsletter about "productivity tools for remote engineering teams" is specific—and worth more to the companies selling to that exact audience.
Why niche matters:
Less competition for sponsor attention
Higher intent from readers (they're there for specific content)
Better conversion rates for sponsors
Ability to charge premium rates to relevant brands
If you can say "97% of my readers work in financial services," you're in a strong position with fintech sponsors.
4. Sponsorship Format and Placement
Not all sponsorship placements are created equal.
Here's the hierarchy of value:
Highest value:
Dedicated sends (entire issue about/featuring the sponsor)
Primary placement at the top of your newsletter
Integrated content where you write about the sponsor naturally
Mid-tier value:
Secondary placement in the middle of content
Multiple placements in one issue
Standard ad blocks
Lower value:
Footer placements
Small text-only mentions
Shared sponsorship space
Your CPM should reflect placement. A primary spot might be your full rate, while a footer placement might be 40-50% of that rate.
5. Your Track Record and Case Studies
This is the secret weapon that separates $30 CPMs from $75 CPMs: proof.
What moves the needle:
Previous sponsor success stories with specific metrics
Testimonials from past sponsors
Click-through rates you've delivered
Conversions or leads generated
Repeat sponsors (huge trust signal)
When you can tell a sponsor "Our last sponsor in your space got 500 qualified clicks and 12 demos booked," you're not selling ad space anymore—you're selling results.
Start tracking this data from day one, even if you're running free trial sponsorships.
Here's a practical system to establish your pricing:
Step 1: Determine your baseline CPM
Start with $30-40 if you're in a valuable B2B niche
Start with $20-30 if you're in a general interest space
Adjust up if you have strong engagement metrics
Step 2: Calculate your base sponsorship price
(Your subscriber count / 1,000) × Your CPM = Base price
Example: (8,000 subscribers / 1,000) × $35 CPM = $280
Step 3: Apply multipliers based on your advantages
High open rate (40%+): +20-30%
Highly targeted niche: +20-40%
Strong engagement metrics: +15-25%
Proven conversion data: +30-50%
So that $280 base price might become $350-400 with the right factors in play.
Step 4: Create tiered options
Primary placement: Full rate
Secondary placement: 60-70% of full rate
Footer/tertiary: 40-50% of full rate
This gives sponsors options and gives you flexibility in negotiations.
How Pricing Evolves as You Grow
Your pricing strategy should mature as your newsletter does:
Phase 1 (0-2,500 subscribers): Testing and proof
Lower rates or even free trials to build case studies
Focus on gathering testimonials and conversion data
CPM range: $15-30
Phase 2 (2,500-10,000 subscribers): Establishing value
Set competitive rates based on your niche
Start requiring minimums (3-month commitments, etc.)
CPM range: $30-60
Phase 3 (10,000+ subscribers): Premium positioning
Command top rates in your niche
Be selective about sponsors
Create waitlists and package deals
CPM range: $60-100+
Each phase requires different positioning and confidence. Don't jump to premium pricing too early, but don't stay in "testing" mode too long either.
Mistake #1: Pricing Based on What "Feels Right"
Your gut isn't a pricing strategy. Use data, competitive research, and the formulas above.
Mistake #2: Never Raising Your Rates
As your newsletter grows and engagement improves, your rates should increase. Review and adjust every 5,000 new subscribers or every quarter.
Mistake #3: Offering Massive Discounts Too Quickly
A 50% discount signals desperation. If you need to negotiate, offer added value instead—extra placements, longer sponsorship periods, or social media amplification.
Mistake #4: Not Factoring in Your Time
Writing custom sponsored content takes time. If a sponsor wants integrated content vs. a standard ad block, charge more to reflect that extra effort.
Mistake #5: Treating All Subscribers Equally
10,000 subscribers where 4,000 actively open and engage is more valuable than 15,000 subscribers with minimal engagement. Price based on engaged audience, not vanity metrics.
Mistake #6: Comparing Yourself to the Wrong Newsletters
Don't benchmark against newsletters with completely different audiences. A B2B fintech newsletter and a lifestyle newsletter aren't comparable, even if they have similar subscriber counts.
Charge premium rates when:
Sponsors are reaching a specific, hard-to-access audience through you
You're creating custom content vs. running standard ads
Your niche has high customer lifetime value (B2B SaaS, financial services, etc.)
You have waitlists or competing sponsor interest
You're offering exclusivity (category or time-based)
Hold firm on your rates when:
A sponsor tries to negotiate by diminishing your value
You're being compared to larger but less targeted newsletters
You have proof of ROI from previous sponsors
The sponsor clearly has budget (venture-backed, established brand, etc.)
Remember: sponsors have budgets. If they want your audience badly enough, they'll find the money.
Before you reach out to your next potential sponsor, here's your homework:
Calculate your current CPM using the formula: (Price / Subscribers) × 1,000
Audit your engagement metrics - Open rates, click rates, time spent reading, reply rates
Research competitive pricing - What are similar newsletters in your niche charging?
Create your metrics one-sheet - Key audience demographics, engagement stats, and any case studies
Set three pricing tiers - Primary placement (full rate), secondary (60-70%), tertiary (40-50%)
Practice your pitch - Be able to explain why you're worth your rate in 30 seconds
Start with these foundations. You'll adjust as you learn what the market will bear and as your newsletter grows, but having this structure gives you confidence in every sponsor conversation.
One practical tip: If a sponsor balks at your rates, don't immediately fold. Ask them what their budget is and what success looks like for them. Sometimes the conversation reveals they're just not the right fit—and that's okay. Better to wait for the right sponsor at the right price than to undervalue your work.
Pricing isn't permanent, and it's not one-size-fits-all. But it should never be arbitrary.
Your pricing should be:
Defensible - Based on real factors like audience quality, engagement, and niche value
Flexible - Tiered options that give sponsors choices
Growth-oriented - Regularly reviewed and adjusted as your newsletter improves
Confident - Presented as the fair value for what you're offering, not an opening bid
The newsletters commanding $75-100+ CPMs aren't necessarily bigger than yours—they're just clearer about their value and better at communicating it.
Your audience is valuable. Your time is valuable. Your expertise in reaching these specific people is valuable.
Price it accordingly.
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