Feb 6, 2024 - Business

Scoop: Substack is helping creators sell ads

Illustration of a small newsletter next to a medium-sized newsletter, followed by a large newsletter

Illustration: Annelise Capossela/Axios

Substack is experimenting with a new pilot program that helps creators on its platform find advertisers and coordinate ad buys, Axios has learned.

Why it matters: Substack was built on the promise of liberating writers and podcasters from the pressures of the ad business by letting them directly charge their audiences. By dabbling with ads, the company is acknowledging the difficulty in scaling that model for everyone.

Details: The pilot program was first noted in a post by journalist and "Blocked and Reported" podcaster Jesse Singal in mid-January.

  • Singal wrote that Substack is providing the "Blocked and Reported" podcast "with some support finding advertisers and coordinating ad buys as part of an experimental pilot program."
  • Asked to clarify, Singal said, "Our understanding is that they contracted with an outside team to approach potential advertisers like any other ad agency would."
  • Substack wouldn't comment on that and said Singal was best positioned to answer any questions about the ad push.

What they're saying: "We're always working with writers, running experiments and listening to feedback," a Substack spokesperson told Axios, while confirming the ad pilot program.

  • "In the case of 'Blocked and Reported,' they were interested in testing out the idea that an advertising and a subscription model might be able to coexist without cannibalizing paid subscriptions, which we believe to be the stronger model."

How it works: According to Singal, Substack has been providing the podcasters with new ads to read on their show, and Singal has "full veto power" to say no, although he's never had to veto an ad yet.

  • "I write a lot about shoddy science, so I wouldn't want to tout some unproven supplement, for example," he said.
  • Singal said he and his podcast partner, Katie Herzog, don't plan to insert ads into the premium episodes they offer paid subscribers, and he has no plans to add banner ads to his Substack posts.
  • "But we feel like we're building momentum and filling more and more ad slots," he noted.

What to watch: For now, advertising isn't core to Singal and Herzog's business model, but Singal said overall he's bullish about the prospect of more ad support for the podcast.

  • "The overwhelming majority of our revenue comes from our premium subscribers, and we don't expect that to change. Ad revenue is the cherry on that sundae, and we expect that cherry to grow over time, which will be great."
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