Should Your Business Start a Newsletter?

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Email newsletters are still a strong marketing tool, but before you start one, you need to think about the good and bad sides. A well-made newsletter can help you connect with customers, build loyalty, and increase sales. For example, a recent guide from Shopify says that successful email campaigns can “attract new customers, strengthen relationships with current ones, raise brand awareness, and boost sales.”

Email marketing also offers a great return on investment (ROI), marketers usually earn about $36 for every $1 spent on email marketing. Surveys show that 87% of small businesses think email campaigns are important, and 64% use them to reach customers. Most consumers check their email regularly; about 88% do so every day, and nearly half will give their email address for a coupon. These reasons make newsletters a very cost-effective way to connect with potential customers and turn them into buyers.

Benefits of Newsletters

High ROI & Low Cost: Email is cheaper than ads, one study found that the average ROI is about $36 for every $1 spent. It usually costs only a few cents to send an email, which is much less than sending physical mail.
Customer Engagement: Newsletters go straight to subscribers’ inboxes, which many busy buyers prefer. They allow you to share helpful content like tips, news, and how-to articles that keep your brand in their minds. In fact, 60% of newsletter readers say marketing emails influenced their purchases. Regular newsletters can build loyalty, and exclusive deals or behind-the-scenes stories can turn casual buyers into loyal customers.
Measurable & Targetable: Modern email platforms like Mailchimp and Constant Contact provide real-time data on how many people open your emails, click on links, and make purchases. You can also sort your email lists by behavior, interests, and location to send more relevant content, which can increase open rates by about 37% and click rates by 267% compared to generic emails. This data helps you improve your messages for better results.

Drawbacks and Challenges

Time and Resources: Writing high-quality content for newsletters regularly takes a lot of time. Small teams may find it hard to come up with fresh ideas and designs every week. Keeping up with scheduling, editing, and responding to subscriber questions can take time away from other important tasks.
Low Open/Engagement Rates: Most newsletters have open rates between 30% and 40%, with click-through rates around 2% to 5%. This means that many emails might not be read. With so many emails in inboxes, there’s a chance your newsletter gets ignored or sent to the spam folder. One study found that about 14.3% of emails don’t reach inboxes because of spam filters. Content that isn't relevant or timely can also lead to people unsubscribing.
Audience Limitations: Newsletters mainly reach people who have already signed up. They aren’t as effective at attracting new customers like social media or SEO campaigns. Growing your email list takes time and effort, especially for small local businesses, which means actively collecting email addresses in-store or online.
Technical and Compliance Issues: Making sure your emails look good on all devices can be challenging. You also have to manage your lists by dealing with bounced emails and unsubscribes while following laws like CAN-SPAM and GDPR. If your lists aren’t well-kept, your emails may not get delivered or may harm your reputation as a sender.

Use Cases by Business Type

E-commerce & Retail: Newsletters are great for driving sales. They can announce new products, flash sales, or special deals directly to interested customers. One study found that 93% of tracked orders came from email campaigns, compared to only 7% from automated emails. Frequent emails that showcase products or offer discounts can boost revenue significantly.
B2B Services and Professional Firms: Business-to-business companies use newsletters to nurture leads and show their expertise. Regular insights like industry trends or case studies can help guide potential customers through the sales process. When these newsletters are well-targeted, they can build trust over time. More than half of B2B buyers prefer email communication over cold calls, making newsletters an effective way to connect.
SaaS and Tech Companies: For software and tech companies, newsletters help keep users informed and engaged. They can include product updates, tutorials, and tips to help reduce customer turnover. Welcome emails for new sign-ups and updates can also encourage users to take advantage of new features.
Local and Small Brick-and-Mortar Shops: Local businesses like cafés or gyms can use newsletters to connect with their communities. Content can include local events, store updates, or special offers for subscribers. For example, a local farm might send out an email listing upcoming events to engage nearby residents. Offering incentives like discounts for signing up can help grow your list. Email marketing is especially cost-effective for local businesses, with some reports showing a 122% ROI.

Open and Click Rates: Average open rates are around 30% to 42%, and click rates are about 2% to 5%. Results can vary by industry. For example, childcare emails may have open rates around 47%, while B2B newsletters can be lower but still effective for qualified leads.
ROI & Adoption: Emails consistently provide better ROI compared to other marketing channels. Many small businesses report using email to acquire and retain customers.
Subscriber Behavior: Most consumers welcome promotional emails, with around 91% of U.S. shoppers wanting to receive them from companies they buy from. Offering discounts can effectively grow your subscriber list.

Overall, companies that commit to email marketing often see significant benefits. People expect to see newsletters, as 88% check their email daily. Consistent and relevant newsletters can reach customers effectively where they already are.

Examples of Successful Newsletters

Fridja (E-commerce): Fridja, an online store, used email campaigns to promote pre-orders for a new product. By sending regular emails to their subscribers about the launch, they were able to sell over 25% of the product before it officially came out. This helped lower the risks of launching a new item and showed how a well-timed newsletter can boost sales.
Angad Singi’s Marketing Monk (SaaS/Media): Entrepreneur Angad Singi started with a newsletter that didn’t grow much at first. Then he launched a new tech-marketing newsletter called Marketing Monk, which quickly gained over 50,000 subscribers. He used this engaged audience to create more businesses, proving that newsletters can be successful on their own. His story shows the importance of persistence; he kept improving his first newsletter until it appealed to readers.
Farmer Jones Farm (Local): This small local farm has a newsletter that shares information about events and seasonal updates. By sending out simple emails with upcoming farmstand dates and community activities, they keep their audience interested and encourage visits. This example shows that even a straightforward newsletter can strengthen a local brand.

These examples highlight a common theme: newsletters that meet customer needs like providing information, entertainment, or savings tend to be successful. On the flip side, businesses that create newsletters without offering clear value may face challenges, as subscribers lose interest if the content seems irrelevant or overly focused on sales.

Choose the Right Platform: Select an email service provider like Mailchimp, Constant Contact, ActiveCampaign, or ConvertKit. These tools help you design emails and track important metrics like opens, clicks, and unsubscribes. Many of these platforms offer free options to get started.
Make Sign-up Easy: Grow your subscriber list by placing sign-up forms in visible places (like your website homepage, blog footers, or checkout pages). You might also use gentle pop-ups or slide-ins. Consider offering a lead magnet (like a freebie) or discount as an incentive. Always use double opt-in if you can to improve list quality.
Create Valuable Content: Plan a mix of content types, such as company news, how-to tips, industry insights, customer stories, and promotions. Follow the 80/20 rule: about 80% of your content should be informative or entertaining, while 20% can be promotional. For instance, you could alternate between product highlights and blog features. It’s important to keep your content relevant, segment your list so each group receives newsletters tailored to their interests.
Design for Readability: Use clean and mobile-friendly templates, as more than half of emails are opened on smartphones. Keep layouts simple with images and bullet points. Include a clear headline and call to action (CTA). Even a small improvement in mobile design can increase click rates.
Stick to a Consistent Schedule: Choose a frequency that you can maintain, whether it's weekly, bi-weekly, or monthly. Consistency builds trust; sending emails sporadically can lead to lost interest. If sending weekly is too much, a high-quality monthly newsletter is better than sending inconsistent updates.
Monitor and Improve: Use your email platform’s analytics to see what works. Track open rates, click rates, and conversions for each issue. Test different subject lines or send times. Over time, remove inactive subscribers to keep your metrics healthy.

By following these steps and using analytics, a business can steadily improve its newsletter’s effectiveness. Even small businesses can start simple, using free tools and sending short monthly updates, and then grow from there.

Conclusion and Recommendations

For many businesses, starting a newsletter is a good idea if it aligns with marketing goals like engagement, loyalty, or repeat sales. When planned correctly, newsletters can provide cost-effective and measurable results. An email strategy encourages customers to return and can significantly increase their lifetime value.

However, a newsletter should match your resources and the needs of your audience. Companies with strong content resources, like writers or designers, and a clear value proposition will see better results. Small e-commerce brands, SaaS products, and local shops often benefit the most, as email directly leads to orders and visits. Even B2B companies can see benefits if they regularly share useful insights with potential clients.

On the other hand, if your business lacks fresh content or marketing resources, a poorly executed newsletter might not be worth it. It’s better to wait than to send out generic emails that could harm your brand.

In summary, if your marketing goals include staying memorable, educating your audience, or increasing sales, a newsletter can be a powerful tool to consider. Plan carefully, invest in quality content and targeting, use data to improve your approach, and integrate it with your other marketing efforts. With consistent effort, a newsletter could become one of your most valuable marketing channels.