For years, publishers have used email newsletters as promotional tools, with the goal of driving subscribers back to their websites and social media properties. Email generated awareness and drove traffic, but it never got the lion’s share of attention. Then the pandemic took hold, and everything changed.
Over the past year, email use has soared and email newsletters have moved into primetime. As publishers look for pockets of opportunity wherever they can find them, programmatic email advertising has gained traction.
It’s not just established media companies investing heavily in email newsletters right now. Brands, bloggers, independent journalists, social media influencers, and even e-commerce websites are launching newsletters at a rapid pace. Having a newsletter as a business tool, and generating revenue through programmatic advertising, has become a highly profitable strategy.
Email as a marketing channel has been around for decades, so what changed in 2020? How did newsletters come to play such a critical role in the playbooks of both digital publishers and brand marketers?
Despite budget cutbacks in response to the pandemic, marketers right now are doubling down on email. According to a recent survey by Ugam, 51% of marketers at major brands said their email marketing spending increased in 2020. Just 16% of respondents reported a decrease.
On the other hand, publishers with email newsletters saw revenue bumps of up to 35% in 2020, with much of that success attributed to an upward swing in email opens and ad engagement.
When advertisers pulled back on spending last spring, one of the first noticeable impacts was a drop in CPMs. Through this, email held strong.
As publishers scrambled to make up the lost revenue, they quickly realized their audiences had remained stable. In fact, consumers actually spent more time on email and social media properties in 2020, which increased the supply of impressions.
Programmatic email quickly became one of the fastest-growing channels, and it’s only expected to grow larger in 2021.
Not only did programmatic email monetization help publishers remain stable during the height of the pandemic in 2020, it also helped publishers build stronger direct relationships with their readers.
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Email builds both habit and loyalty, which is especially important in the new media business model. When publishers embrace email and monetize it with advertising, they’re investing in a channel they actually own.
New Beginnings for Email Monetization
One factor that explains the increase in publishers launching email newsletter strategies in 2020 has to do with the rise in programmatic email monetization and the support that publishers found when other revenue channels failed during the early days of the pandemic.
Newsletters are now products themselves, as well as premium media channels. No longer relegated to the role of kid brother, email newsletters are driving real revenue for digital publishers that have found ways to implement the latest programmatic monetization opportunities.
With 3.9 billion people using email—over half the world’s population—the opportunities in newsletter publishing are limitless.
Two-thirds of marketers (66%) expect their programmatic budgets to increase in the coming months, according to a study from Ascend2. Programmatic advertising in email newsletters offers a unique opportunity to advertisers—they can reach real people. Moreover, these real people are opting-in to receive newsletters because they actually want to.
This leads to exceptionally high levels of engagement and action, and that’s good news for digital-first news outlets like Hustle or Vogue Business, which operate as newsletters and generate revenue through subscriptions packages and digital advertising programs.
Connecting Email to Programmatic
The connection between newsletters and programmatic advertising isn’t always an obvious one, but it’s something that more publishers will have to understand if they’re going to invest in this strategy in 2021. Email is an effective vehicle for programmatic campaigns because it scales across multiple devices—people access email on smartphones, tablets, and laptops, as well as desktop computers.
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Safety is another issue, both for publishers and advertisers. Email tends to offer a more secure environment, where a login is usually required. This makes fraud less likely, meaning that programmatic email delivers more authentic clicks from actual people than other channels.
The data that newsletter publishers are able to provide based on their audiences’ interests, behaviors, and demographics can get incredibly deep, offering marketers the ability to track individuals based on purchases, engagement, or sign-ups.
Although there will always be some growing pains with new technologies, the challenges in targeting audiences, generating metrics, and applying measurement to programmatic email campaigns have largely been worked out.
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Publishers have learned that they need to find the right balance between ads and editorial content to maintain newsletter quality. They also need to invest in designs with a mobile-first approach to optimize their results.
What’s on the Rise
The combined use of programmatic advertising with email campaigns offers a one-two punch for publishers and brand advertisers. With this strategy, publishers are connecting ads and email content to their audiences’ online behaviors. As we look further into the coming year, here are a few examples of what we expect to see:
- Programmatic Push – Direct publishers saw bigger drops in revenue in 2020 than programmatic specialists, with 77% of publishers saying clients asked to cancel campaigns versus 49% of programmatic specialists. As an undervalued growth channel that lends itself well to programmatic advertising, email newsletters are expected to have a big year in 2021.
- Engaged Content – Relevant newsletters can be sent to readers based on the content they have engaged with on a publication’s website. A reader who views sports articles would therefore be more likely to receive a sports-focused newsletter with targeted advertising based on his or her personal preferences and demographics.
- Retargeting Following Email Engagement – Opening an email and clicking on a link demonstrates a certain level of interest from email subscribers. Savvy publishers will continue expanding their programmatic programs in 2021 and offer advertisers the ability to retarget ads to get in front of readers who’ve demonstrated their interest by clicking on links in the past.
Publishers who want to capitalize on the growth in programmatic email advertising can use specialized tools to identify newsletters with dynamic ads. Working with a top email monetization platform like inboxAds that uses a quality ad inventory is the best way to maintain control over the ads that run in a newsletter.
Despite quick growth, the programmatic email advertising space is still young. As more companies find financial success with this approach, competition is likely to expand. Publishers that start using programmatic email monetization in 2021 are getting in on the ground floor.
Those that hesitate could be missing out on significant revenue that they won’t be able to recoup in the future.