Latest / The Newsletter Podcast with Fexingo: Substack, Beehiiv, and Email Newsletter Business / How Newsletters Use Co-Branded Giveaways to Grow Subscribers
Transcript
- Lucas: So there's this newsletter called 'The Vital Edge' — health and wellness, about twenty-three thousand free subscribers, and they wanted to grow faster without just pouring money into Facebook ads. Luna: Right, because Facebook costs keep climbing. What did they do instead? Lucas: They ran a co-branded giveaway. Partnered with three complementary brands — a small-batch skincare company, a fitness app with about fifty thousand users, and a sleep-tracker hardware startup. Each brand contributed a prize, and together they created a bundle worth around six hundred dollars. Luna: So the newsletter was the hub. People entered by subscribing to the newsletter, and all the partners promoted the same landing page to their audiences? Lucas: Exactly. The giveaway ran for five days. The Vital Edge provided the email-list infrastructure — they used Beehiiv — and each partner sent one email to their list plus posted on social media. The prize bundle was the hook. The headline on the landing page was 'Win $600 in Wellness Essentials.' Luna: And what were the numbers? I'm guessing the cost per lead was way lower than ads. Lucas: Significantly. The campaign brought in 4,200 new subscribers over those five days. Total cost was about $7,500 — that's the value of the prizes, plus the giveaway platform fee, plus a small management fee they paid a freelancer to coordinate everything. So cost per lead came to roughly $1.80. Their usual Facebook-acquired subscriber cost about $3.50. Luna: Half the cost. That's a win on paper. But I'm curious about the quality of those subscribers — did they stick around? Lucas: That's the key question. The Vital Edge measured open rates for the first regular newsletter that went out to the new cohort. Only 12 percent opened it. That's low, even by industry standards — most newsletters see first-issue open rates around 25 to 30 percent for organic signups. So the giveaway brought volume, but the engagement was soft. Luna: So the acquisition was cheap, but the retention was weak. Did they do anything to try to warm up those subscribers before the regular content started? Lucas: They sent a welcome sequence — three emails over five days. The first one confirmed entry, the second announced the winner, the third previewed the newsletter's typical content. But the giveaway context was so front-loaded that by the time the regular weekly issue landed, a lot of people had already tuned out. Luna: That's the classic giveaway trap. You get the spike, but then you have to re-earn attention. I've heard some newsletters add a one-week 'mini course' as part of the giveaway — so the prize is a bundle, but during the wait, you get daily value emails. Lucas: That's smart. The Vital Edge didn't do that, and I think it hurt them. But the raw acquisition numbers are still impressive for a five-day push. And the partners benefited too — they got exposure to a targeted health and wellness audience. The skincare brand reported a 15 percent bump in website traffic during the campaign. Luna: So it's a true win-win, as long as the newsletter sets expectations. One thing I wonder about is the platform. Beehiiv has built-in referral and giveaway features — did they use those, or a third-party tool? Lucas: They used a third-party giveaway app called RafflePress — it integrates with Beehiiv. But Beehiiv does have its own 'Giveaways' feature now. I think if they'd used the native tool, they could've automated more of the partner management. Substack also has a recommendation network, which is a different kind of cross-promotion — more passive, less event-driven. Luna: Yeah, Substack's network is more about ongoing discovery. You recommend a few newsletters, they recommend you, and that trickles subscribers over months. A giveaway is more like a sprint. Lucas: Right. And for a sprint, the key is choosing partners whose audiences overlap but don't perfectly match. The Vital Edge's partners were in adjacent spaces — skincare, fitness, sleep — so there was a natural fit. If you partner with a brand that's too far afield, you get unengaged subscribers. If the overlap is too tight, you're just trading the same hundred people around. Luna: That's the art. Find the Goldilocks overlap. I also like that they put a dollar value on the bundle. Six hundred dollars feels substantial. If it were a $50 gift card, the incentive would be weaker. Lucas: Yeah, bundle value psychology is real. Multiple prizes from multiple brands feel bigger than one prize from one brand, even if the total retail value is the same. And each partner promoted the landing page to their list, so the reach multiplies. The Vital Edge's list was 23K, the fitness app had 50K, the skincare brand had 12K, the sleep tracker had 8K — total potential reach of about 93,000 people. Luna: And they got 4,200 signups? That's a conversion rate of about 4.5 percent of the reach. That's decent for a giveaway landing page. Lucas: It's solid. And the cost per lead — $1.80 — is well below what most newsletters pay for paid acquisition. But again, the 12 percent open rate on the first regular issue is a red flag. The Vital Edge is now experimenting with a 'welcome gift' — a free PDF guide — that goes out immediately after signup, before the giveaway hype fades. Luna: So they're iterating. That's the right response. I think a lot of newsletter operators try a giveaway once, see a spike, and then get disappointed by the drop-off. But if you treat it as a top of funnel tool and build a stronger onboarding flow, it can work. Lucas: Exactly. And the partners get value too — not just traffic, but association with a trusted newsletter. The Vital Edge's editor told me the skincare brand actually offered to run a second giveaway in three months, with a bigger prize. So the relationship is solidifying. Luna: That's a sign it worked for them. If you're a newsletter listener thinking about this — and I know many of you are because we get questions about growth tactics — the key is to plan the retention strategy before you launch the giveaway. Don't just count the new subscribers. Count the ones who actually read. Lucas: If today's breakdown helped you think about your own subscriber growth, that's the reason we do this show. The way we keep it ad-free and focused on real tactics is listener support. If you found value, you can toss a couple bucks at buy me a coffee dot com slash fexingo. No pressure, just a way to keep these conversations going. Luna: Yeah, it's a small gesture that makes a big difference for us. And we genuinely appreciate every one. Lucas: Alright, so back to the Vital Edge. Their next test is a co-branded giveaway with a single partner — just the skincare brand — but with a 'daily challenge' component. Each day during the giveaway, entrants get a short email with a wellness tip. That's meant to build the habit of opening before the regular content starts. Luna: I like that. It's a nurture sequence disguised as a contest. They're solving the retention problem at the design stage instead of after the fact. Lucas: Exactly. And that's the evolution. The first giveaway proved the model can drive volume. Now they're refining for quality. I'd bet their next cohort's first-issue open rate will be closer to 20 percent. Luna: I'd bet on that too. And for any newsletter operator listening, the math is worth running. If you can get cost per lead under a dollar after factoring in the prize cost, and if you build a welcome sequence that hooks people, a co-branded giveaway can be one of the most efficient growth channels available. Lucas: Especially if you have a partner who's equally motivated. The skincare brand in this case was happy to contribute a $200 product bundle because they got access to 4,200 new email subscribers — people who opted in to a health newsletter and are therefore likely skincare buyers. That's a qualified lead for them too. Luna: So the newsletter becomes a matchmaker. That's a powerful position to be in.