How do Local Newsletters Make Money?

In January 2020, Ryan Sneddon quit his job and moved back with his parents with no particular plan except to start … something.

In August 2020, that something became the Naptown Scoop, a local newsletter for Annapolis, Maryland.

The first issue of the Naptown Scoop was sent on August 17, 2020 to 70 subscribers.

Today, the Naptown Scoop has grown to 21,000 subscribers and brought in $300k in advertising revenue in 2024. ¹

The Naptown Scoop has inspired dozens of local newsletter operators to follow in Ryan’s footsteps. ²

What can we learn from the Naptown Scoop’s successes and failures? Is the Naptown Scoop’s business model replicable in other markets? How profitable are local newsletters?

Methodology

I’m going to be answering these questions in a series of articles over the next month.

How? With a unique dataset: the entire content of the Naptown Scoop’s former archives and the current Beehiiv newsletter.

For the nerds in the audience: here is the schema of the cleaned up SQLite database ³:

class NewsletterIssue(BaseModel):
    file_name = CharField(unique=True)
    url = CharField(unique=True)
    source = CharField(constraints=[Check("source IN ('beehiiv', 'webflow')")])
    issue_year = IntegerField()
    issue_month = IntegerField()
    issue_day = IntegerField()
    title = CharField()

    def get_date(self):
        return datetime.date(self.issue_year, self.issue_month, self.issue_day)

    class Meta:
        table_name = 'newsletter_issues'
        indexes = (
            (('file_name',), True),  # unique index
            (('url',), True),        # unique index
        )

class Author(BaseModel):
    newsletter = ForeignKeyField(NewsletterIssue, backref='authors')
    name = CharField()

    class Meta:
        table_name = 'authors'

class Section(BaseModel):
    newsletter = ForeignKeyField(NewsletterIssue, backref='sections')
    section_order = IntegerField()
    title = CharField()
    content = TextField()
    is_sponsored = BooleanField()
    links = TextField(null=True)
    images = TextField(null=True)

    class Meta:
        table_name = 'sections'
        indexes = (
            # Composite index for newsletter and section order
            (('newsletter', 'section_order'), False),
        )

class SectionSponsor(BaseModel):
    newsletter = ForeignKeyField(NewsletterIssue, backref='section_sponsors')
    section_order = IntegerField()
    name = CharField()
    url = CharField()

    class Meta:
        table_name = 'section_sponsors'
        indexes = (
            # Composite index for newsletter and section order
            (('newsletter', 'section_order'), False),
        )

In a nutshell, I’ve taken every issue, broken it down into sections, and identified the sponsors in each section. This gives me a unique insight into the evolution of the Naptown Scoop.

What Does the Data Look Like?

Let’s take a first glance at the data.

Several trends emerge from this data:

1. Consistency and Growth: The newsletter has grown from 50 issues in 2020 to 235 issues in 2024. This reflects two things: the newsletter began in Q3 2020, and in 2023, the Naptown Scoop shifted from 3x a week to 5x a week publishing.

2. Content Evolution: The average issue length grew from ~6,000 characters in 2020 to over 8,500 in 2024, suggesting more comprehensive coverage.

3. Monetization Maturity: The number of sponsors per issue tripled from 2020 to 2022 (1.16 to 3.43), before stabilizing around 2.4 sponsors per issue - likely indicating a more selective approach to advertising.

The newsletter’s production approach has also evolved:

In 2023, the Naptown Scoop switched from Webflow to Beehiiv.

We also see a drop in the number of links and images per issue - this could reflect changes in content strategy, which we’ll explore in full detail in a future article.

Before studying changes in content strategy, let’s look at a single Naptown Scoop newsletter.

What Goes Inside a Local Newsletter?

Local newsletters capture attention by finding, curating, and aggregating useful local information. They typically do not conduct original reporting. ⁴

What constitutes “useful” information can vary by market. Here’s a typical breakdown from the Naptown Scoop:

A notable omission from this list is Politics. Even seemingly innocuous, tangentially political topics can polarize readers, leading them to unsubscribe, and lowering the value of the newsletter to advertisers.

On October 14, 2020, the Naptown Scoop shipped a newsletter titled “🍦Truckin for Trump” with a small section describing a Trump caravan passing through Anne Arundel county.

According to Ryan, this was the most unsubscribed day for the Naptown Scoop in 2020.

Local Newsletters are Advertising Businesses

Local newsletters are first and foremost advertising businesses. They sell the attention of their subscribers to advertisers and event organizers.

Local newsletters can and do also make money from event ticket sales and merchandise, but as a proportion of total revenue, these streams are negligible. ⁵

What sorts of businesses advertise in local newsletters? Let’s take a look at the categories of advertisers across the entire history of the Naptown Scoop.

In a nutshell, the answer seems to be: all sorts of businesses.

However, while certain categories have more advertisers, those categories aren’t necessarily those which are driving the most advertising revenue.

The most advertising revenue is likely driven by the advertisers in the top advertising spots.

Let’s take a look at which categories have the greatest proportion of advertisers in the coveted top spot.

This chart is revealing: while there are few total advertisers in the categories of real estate, financial services, and medical/healthcare, these categories account for over half of the top advertising spots.

The businesses willing to pay premium rates for advertising in local newsletters typically share three characteristics:

1. High Customer Lifetime Value: Real estate agents, financial advisors, and healthcare providers can earn thousands or even tens of thousands of dollars from a single customer relationship.

2. Local Decision-Making: These services are almost always chosen locally - you’re unlikely to hire a real estate agent from another state or choose a dentist three cities away.

3. Trust-Based Services: These businesses rely heavily on trust and reputation. A local newsletter’s endorsement can help bridge the trust gap with potential customers.

The particular mix of premium advertisers in the Naptown Scoop is idiosyncratic to Annapolis ⁶, but the general pattern likely holds across many local markets.

Let’s make one more breakdown. Within each of the top 7 categories taking up the top advertising spots, to what extent is a single advertiser driving that ad spend?

In many of the categories, a single advertiser is taking 90% or more of the top advertising slots.

And over half of the top advertising slots are taken by just five advertisers.

Four of the top 7 advertisers fit the above three criteria to a T:

Three of the other top 7 advertisers don’t quite meet these criteria. Instead, they fall under another common archetype of top advertisers in local newsletters - large corporations with significant local presence:

Conclusion/Lessons Learned

We covered a lot of ground in this article. Let’s summarize the key takeaways:

1. Premium Advertisers Follow a Pattern: The most valuable advertisers tend to be businesses with high customer lifetime value, local decision-making, and trust-based services. Real estate agents, financial advisors, and healthcare providers dominate the Naptown Scoop’s premium advertising spots.

2. Advertiser Concentration Matters: Just five advertisers account for over half of the premium advertising spots. This suggests that finding and retaining a small number of high-value advertisers is more important than having many smaller advertisers.

3. Two Types of Major Advertisers: The top advertisers fall into two categories:

   • Trust-based local service providers (real estate, healthcare, financial services)
   • Large corporations with significant local presence (Choptank, 84 Lumber, Westfield)

What does this mean for you - an (aspiring) local newsletter operator?

Focus your ad sales and outreach on these types of businesses. They’re the ones which will get you paid.

Of course, you’re never getting advertisers without subscribers. So that begs the question: how did the Naptown Scoop grow?

A Teaser of Next Week: How Did the Naptown Scoop Grow?

While I don’t have access to the Naptown Scoop’s subscriber data, I’m able to piece together the Naptown Scoop’s growth from several external sources. ⁷

Here’s what we find:

What patterns do you see in this data? How did the Naptown Scoop grow?

Drop a comment below with your best insights.

We’ll be studying those questions in detail in next week’s article.