Latest / The Newsletter Podcast with Fexingo: Substack, Beehiiv, and Email Newsletter Business / Why Newsletter Creators Are Ignoring The Open Rate Trap
Transcript
- Lucas: Let’s talk about the number that is lying to you every single morning. It is sitting right at the top of your dashboard, glowing in green or red depending on how well you slept. For ten years, it was the holy grail of email marketing: the open rate. But here is the thing, if you are checking your open percentage before you check your active subscriber count, you are running a business on smoke signals. Luna: It feels like we hit a wall with privacy changes and apple’s app tracking transparency around twenty twenty two, but I still see creators panicking when it dips below twenty percent. Lucas: Exactly. And panic leads to bad decisions. It leads to subject line spamming, which degrades trust, which kills long term growth. The shift we are seeing now in late twenty twenty six is not just about privacy; it is about a fundamental rethinking of what an email list actually is. It is no longer a broadcast channel; it is a owned audience asset. And assets are measured by yield, not reach. Luna: So you are arguing that we should stop optimizing for the inbox and start optimizing for the action inside the inbox? Lucas: Precisely. Let’s look at the platform level shifts. Both Substack and Beehiiv have quietly adjusted their default reporting. They used to highlight open rates because it made the platform look alive. Now, they are pushing engaged subscriber counts and revenue per user. Why? Because an open does not pay the server bill. A subscription does. A click on a premium link does. The incentive structure of the tools is finally aligning with the reality of the creator economy. Luna: I noticed that on my own dashboard, the open rate graph has been flattening out while the click-through rate is becoming the primary volatility indicator. Lucas: That is the signal. Click through rate, or CTR, is a much cleaner proxy for interest than an open. An open can be accidental, or it can be a preview pane render. A click requires intent. It requires the reader to decide that what you said is worth their next second. When you optimize for clicks, you are forced to write better content, not just catchier headlines. You are building a habit of attention, not a trick of visibility. Luna: But doesn’t ignoring open rates mean we are blind to deliverability issues? If no one opens it, how do we know if we are going to spam folder? Lucas: That is a fair concern, but it is solvable without making open rates the north star. You monitor deliverability through bounce rates and complaint rates. Those are binary, hard data points. If your bounce rate goes above two percent, you have a hygiene problem. If complaints spike, you have a relevance problem. You fix those with list cleaning and segmentation. You don’t fix them by writing more sensationalist subject lines. The diagnostic tool has changed, even if the underlying risk remains. Luna: So we are moving from vanity metrics to operational metrics. That sounds like a lot of work for someone who just wants to write. Lucas: It is less work in the long run because it stops the guessing game. Think about pricing strategies. We covered pricing in previous episodes, but pricing relies on knowing your true value. If you think you have fifty thousand readers based on historical open rates, but only five thousand are actively clicking, your pricing model is built on a fantasy. You might underprice your paid tier because you think you have scale you don’t actually have. Or worse, you overprice because you think your engagement is higher than it is. Luna: Right, so the engaged subscriber count becomes the denominator for all your financial projections. That changes the entire math of the business. Lucas: It does. Let’s look at a specific case study from the mid-tier creator space. There is a finance newsletter that grew rapidly in twenty twenty three using traditional tactics. By early twenty twenty four, their open rates crashed. They panicked. They tried influencer collabs. Nothing worked. Then they switched focus to segmenting their list by engagement. They identified the top fifteen percent of readers who clicked every time. They offered those readers a deeper, higher priced tier. Revenue went up forty percent while total subscriber count stayed flat. They didn’t need more people; they needed fewer, better people. Luna: That is a classic quality over quantity play. But how do you identify those engaged subscribers without relying on the open rate? Lucas: You use multi-touch attribution. You look at clicks, replies, social shares, and purchase history. A reader who hasn’t opened in six months but bought a product last month is more valuable than a reader who opens every day but never engages further. Email clients are getting smarter at hiding opens, but they cannot hide a transaction. Your CRM needs to weigh actions differently. A reply should count for more than a click. A click should count for more than an open. Luna: So we are essentially building a loyalty score for each individual subscriber. That sounds like a significant technical lift for small creators. Lucas: It doesn’t have to be complex. Most modern newsletter platforms allow you to tag users based on behavior. You can create a simple rule: if a user clicks any link in the last thirty days, tag them as high engagement. If they haven’t opened in ninety days, tag them as dormant. Then you send different content to those groups. High engagement gets the deep dive analysis. Dormant users get a re-engagement campaign. You are treating them as distinct segments, not a monolith. Luna: Segmentation is key. I feel like most creators treat their whole list as one blob and blast the same message to everyone. Lucas: That is the lazy way out. And it is expensive. Sending to inactive subscribers burns your sending reputation and wastes your bandwidth. Every email you send costs money in terms of platform fees if you are on a volume-based plan. It also costs social capital. If you keep emailing people who aren’t listening, they eventually unsubscribe or mark you as spam. That hurts your deliverability for the people who do care. It is a vicious cycle. Luna: So cleaning the list is actually a defensive move to protect the core audience. Lucas: Exactly. It is pruning the tree so the fruit stays sweet. Now, I want to pause here for a moment because this kind of strategic clarity is what keeps these shows running. If these marketing conversations have sparked something you've actually used, consider supporting the network directly. A couple of dollars a month is genuinely what keeps these going — buy me a coffee dot com slash fexingo, if you've gotten something out of them. Luna: Yeah, it really helps us dig into these niche operational details rather than staying on the surface level. Thanks for keeping the lights on. Lucas: Back to the data. Once you have segmented your list, you can start looking at cohort analysis. This is where you track groups of subscribers based on when they joined. Do the January cohort convert to paid at a higher rate than the June cohort? If yes, why? Was there a seasonal trend? A specific viral post? Cohort analysis tells you which acquisition channels are bringing in high quality users versus low quality users. Luna: That is huge. I always assumed new subscribers were equal, but clearly a referral from a trusted friend brings in different value than a random ad click. Lucas: Completely different. Referral traffic has higher lifetime value. Ad traffic often has lower engagement. If you are spending money on ads, you need to know the LTV, or lifetime value, of those customers. If the LTV is lower than the cost of acquisition, you are burning cash. Open rates don’t tell you that. Click-through rates combined with conversion data do. You need to connect your email analytics to your payment processor. That is the missing link for most solo creators. Luna: Connecting those systems is scary for some people who aren’t tech savvy. Is there a middle ground? Lucas: There is. Look at the export features. Most platforms let you export CSV files of your subscriber data. You can pull that into a simple spreadsheet once a month. Add columns for purchases. Calculate the average revenue per user. It takes an hour a month. It gives you more insight than staring at the open rate graph for ten minutes every day. Start simple. Track one metric that matters: revenue per subscriber. Watch how it moves over time. Luna: Revenue per subscriber. That is clean. It forces you to think about both upsides and downsides. More subs helps, but only if they pay. Lucas: Right. And it highlights churn. Churn is the silent killer. If you gain ten new subscribers but lose eight paying ones, you are leaking bucket water. Open rates won’t show you churn until it is too late. Engagement metrics will. If your click rate drops across the board, churn is coming. You can intervene. You can send a survey. You can offer a discount. You can save the relationship before the cancellation happens. Luna: Proactive retention based on behavioral signals. That is a much stronger position than reactive apologies after someone leaves. Lucas: It is. And it builds a culture of responsiveness. Readers notice when you listen. When you adjust your content based on what they click, they feel seen. That increases loyalty. Loyalty reduces churn. Reduced churn improves your unit economics. It is a virtuous cycle. The old model was a leaky bucket filled by shouting louder. The new model is a cup that you fill carefully and protect. Luna: I love that analogy. Filling the cup carefully. It feels less frantic. Lucas: It is less frantic because you are working with reality. You are not fighting Apple’s algorithms or Google’s filters. You are talking to humans who chose to hear from you. Respect that choice by giving them what they want, measured by what they do, not what they pretend to do. Luna: So the takeaway is audit your dashboards, kill the open rate obsession, and start tracking engagement and revenue per user. Lucas: Start there. Segment your list. Connect your payments. Watch the cohort. It is a process, not a switch. But once you make the switch, your business becomes transparent. You stop guessing. You start growing. What metric will you change tomorrow?