In order to develop a sustainable sponsorship revenue stream, you will need to focus on a few key areas:

  • Growing your retention rates

  • Regular reporting to sponsors

  • Price increases with audience growth

Growing Retention Rates

Growing retention rates is more difficult in a primarily digital environment compared with traditional print advertising. MediaRadar reports that with digital advertising in general, renewal rates sit around 20%. Still, it’s incredibly worthwhile to grow your renewal and retention rates. It takes significantly less work to retain a current sponsor than it does to find a new sponsor.

Instead of selling one-time sponsorships, aim to bring sponsors on with longer term contracts. For newsletter ads this could mean selling one ad per month for a quarter. For display ads, you can sell 3-month, 6-month packages. With larger sponsorship opportunities, sometimes year long or even multi-year contracts are appropriate. 

 

Regular Reporting to Sponsors

One of the best ways to increase your renewal and retention rates is to show your advertisers the return they’re getting. Impact reports should be sent to sponsors:

  • After a one-time ad runs or at the end of an ad campaign

  • If it is a longer running campaign, send a mid-campaign report and include suggestions on how to improve engagement

  • After an event or program

A simple report sent to advertisers that includes a thank you, some metrics, contact information, and an offer to rebook should be sent out regularly. For a one-time advertiser, this should be done within three business days of the ad running. For longer-term advertisers, sending a report out once a month is a good option.

Price Increases with Audience Growth

As your audience and publication grows, so too will your expenses. Make sure you are regularly increasing your sponsorship rates. Communicate price increases as early as possible and put together a tiered pricing plan that shows ad cost with audience growth. Consider grandfathering in early adopters for a limited amount of time, but always let them know that the price will go up at a specific date.

---- Sample Price Increase Messaging ----

Hi [FIRST NAME]

As a valued partner of [PUBLICATION], I wanted to let you know that we will be increasing our advertising rates starting [DATE].

Your support has been instrumental in allowing us to keep doing our important work. As our audience and business grows, so do our expenses. Our goal is to continue offering the best product possible to both our readers and our sponsors. Our new pricing will be as follows:

[NEW PRICING]

We guarantee we will continue offering high-quality sponsorship opportunities that will reach an engaged audience; higher prices mean you are reaching more people and we are able to offer better recognition.

If you are currently signed onto a longer-term contract, please know that we will honor the original pricing. The increased rates will only apply to any new advertising.

If you have any questions or concerns, please don’t hesitate to reach out so we can chat.

Sincerely,

[NAME]

[EMAIL SIGNATURE]

------

NOTE: No matter how justified your reasoning is and no matter how well you articulate it, you will likely always receive at least some complaints about prices going up.

READ MORE: Hubspot has an excellent article “How to Let Customers Know About a Price Increase” 
You can outline a graph like this (or even simpler) to outline how costs will increase with audience growth.