A deep dive into the different types of ads, the pros and cons of different approaches, and some important considerations when mixing ads and subscription revenue.
I’ve only worked in programmatic contexts and never had the right frameworks / vocabulary for talking about this stuff, so this post was extremely useful for me! I think you know where my priors are here: I’d love to be in a ~70% subscription / 30% “other revenue” world, with eg Meetings and direct sales / sponsorship type ad revenue helping expand the number of ways you can make money on Substack.
Very lucidly explained and presented man!
Great article. I wonder if comparing LTV between paying and “free” is right in a hybrid model. The LTV of a subscriber will be higher, but the absolute number is a fraction of the audience. I don’t understand extracting no value from people who aren’t paid subscribers. The complexity and tension is real, but that’s media. I just believe it’s common sense to make money in multiple ways and use ads as a reasonable value exchange with 90%+ of your audience.
I think the ideal revenue mix is actually 50% subscriptions and 50% advertising.