👋 Hi friends -
Welcome to The Newsletter Growth Memo. Twice a month, I share short reflections with my newsletter clients + other operators.
Zero formality, ads, or affiliate links - just a guy sharing learnings from working with media operators doing $25-500k+ / month with newsletters.
New reader highlights: Welcome to Isaac, Founder @Experiential Hospitality | Paul, Founder @Pickleball Union | Lesley, Newsletter Director @MVF | Noah, CEO @ Stacker
Last summer I wrote to you about a huge issue among newsletter brands.
Everyone on Twitter was addicted to cost per lead (CPL) as the holy grail of paid marketing success.
I talked about how that leads to bad decision-making in ad accounts, declining sponsor performance, and (for the biggest brands) 6 or 7-figures left on the table.
I’ve seen very few marketing programs change since then.
So I want to show you what happens when you focus on quality:
The Rundown and The Neuron have nearly doubled their click-through rates for readers coming from Meta
Arnold Schwarzenegger's newsletter is seeing a higher CTR from Meta ads than organic subscribers
We started working with one of the largest media companies in the world - their flagship newsletter has a 23% higher ARPU, 10% lower CPL and is now profitably spending more on Meta than all but a few newsletter brands
While we’re the only agency actively measuring reader quality vs. CPL to guide marketing decisions, there are a few other operators doing this:
Nate at The Pour Over
Tim + Erika at 1440
Faris at The Deep View
Jay at Workweek
A few larger teams that have dedicated analytics FTEs (Morning Brew, etc.)
But it’s the exception, not the norm.
I want this list to be a lot longer!
And so today I want to re-email you that newsletter media is still way behind other niches (mobile apps, ecomm, etc.) in having tools/processes to help operators understand LTV:CAC at the ad level (+ adjust marketing accordingly).
This (largely because of most ESPs) is handicapping your marketing team’s ability to make better decisions about how you scale.
CPL is an awful metric.
Let me show you why with a quick story:
Imagine your friend running an e-commerce company comes up to you, super pumped about their latest marketing win.
"We've been running ads on Meta and have our add-to-cart cost down to just $5!"
That's cool! I think.
But a little odd, no?
I mean, what does an add-to-cart do for your friend until the visitor actually buys their beef-tallow-infused Peruvian hand cream? Or whatever the kids sell these days.
The answer is not a damn thing!
And a lead hasn't done anything for your sponsor-monetized newsletter until they start opening and clicking.
Let me show you exactly what I mean with a real example I see all the time with 6 and 7-figure newsletters.
The marketing team is looking at two ads:
Ad A: "Learn about AI in 5 minutes a day"
CPL: $1.50
CTR: 2%
Ad B: "Product managers are 2x more likely to get promoted using AI"
CPL: $2.00
CTR: 5%
At first glance, Ad A looks like the winner because it's cheaper. Marketing team kills Ad B.
Why? An extra 50-cent CPL. Evil—right?
But here's what they missed...
Ad B's click-through rate is 2.5X higher.
The team had NO IDEA what engagement looks like at the ad level.
So what's the fix?
We call it Click Score.
It factors in CPL, click-through rate, and unsubscribe rate to help you compare subscriber quality vs. CPL across ads apples-to-apples.
It’s not fancy - it’s practical, which is great because:
Most newsletter companies don’t have money to spend on data engineers - you can do this in an Excel sheet
CTR is correlated with ARPU enough that you don’t need to pull in your sales team for calculations - a business analyst could do this in an hour or two per week
This means that (I hope) teams will actually use it.
Here's exactly how to calculate it:
Step 1: Adjust CPL for unsubscribers
If 10% of Ad A's leads unsubscribed (versus 5% of Ad B's) in the first 30 days, then the actual cost per retained lead is:
Ad A: $1.50 / (1-0.10) = $1.67
Ad B: $2.00 / (1-0.05) = $2.11
Step 2: Compare the CTR of engaged subscribers
Ad A = 2% CTR
Ad B = 5% CTR
Step 3: Calculate the Click Score
Click Score = Adjusted CPL / CTR
Ad A = $1.67 / 0.02 = 83.5
Ad B = $2.11 / 0.05 = 42.2
Lower score wins.
Ad B's leads are ~2X better quality—even though the initial CPL looked worse.
The Takeaway: Stop Chasing Cheap Leads
❌ Low CPL is misleading—what matters is long-term engagement
✅ High-CTR = better leads, even if CPL is higher
📊 Use Click Score to compare ads fairly, not just based on CPL
That's the letter.
Nathan May
P.S. How do you influence click score? Quality creative strategy. My guide to that here.
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