A Definitive Guide on What Is Substack and How It Works

A Definitive Guide on What Is Substack and How It Works
17 February, 2024 • ... • 2942 views
Anastasia Ushakova
by Anastasia Ushakova

Content creation has evolved beyond traditional publishing models, offering authors unprecedented opportunities to connect directly with audiences. Among the platforms leading this revolution is Substack — but what is Substack exactly? 

In this article, we are delving into the specifics of creating and distributing content via Substack, offer tips on developing a perfect newsletter and learn about other similar tools.

What is Substack?

Substack is an American online platform that allows journalists, writers, and other content creators to publish newsletters and establish a subscription-based audience. It provides tools for authors to create and distribute their newsletters, manage subscriptions, and monetize content via subscriptions.

Independent creators have the option to provide digital newsletters directly to their audience on either a free or paid basis, with Substack earning a percentage of the subscription revenue. While the platform is primarily text-based, it offers four main formats for posts: text-based posts, podcasts, discussion threads, and videos.

Substack home page

Since its launch in 2017, Substack has enjoyed a steady growth. According to Axios, the platform has over 17,000 writers, while the number of paid subscribers hit 2 million in 2023. Readers have paid writers more than $300 million through Substack subscriptions.

Hundreds of prominent media figures, journalists, thought leaders and writers use Substack, covering topics such as the arts, politics, fashion, current affairs and sports, among others. For example, American singer-songwriter Patti Smith shares poetry readings on the platform. Other prominent users of Substack include American journalist Seymour Hersh, writers Chuck  Palahniuk and George Saunders.

Patti Smith’s Substack page

How does Substack work?

Substack’s main function is connecting the creator and the consumer, and it combines features of a blog and email newsletter. Authors can use the platform for personal writing or news, and send digital newsletters directly to a reader’s inbox. There are also tools for podcasts and group chat broadcasts.

Here’s what a post by British writer Bolu Babalola looks like on the Substack website:

Substack post by British writer Bolu Babalola

This is what the same post looks like as an email newsletter on iOS Mail app: 

Email newsletter from Substack

Some of Substack’s pros include:

  • It’s user-friendly. It is very easy to get started, and you do not need any technical skills to use Substack. 
  • Monetization opportunities. Substack offers options for creators to monetize their content through paid subscriptions, offering a direct source of revenue without relying on ads.

Here are a few cons:

  • Limited customization. While Substack offers some customization options, creators have limited control over the design — creators can only change fonts and colors of their newsletters.
  • Revenue share. Substack charges users a 10% fee (not including credit card  processing fees) on paid subscription revenue, which is often higher compared to its competitors. This also means that high earners will be paying a hefty sum to Substack — for example, if you earn $100,000, you’ll be charged at least $10,000 by the platform. 

Is Substack free?

Substack itself is free to use for writers and creators. They can sign up, create newsletters, and distribute content without initial expenses. If they opt for paid subscriptions on Substack, the platform takes a cut of 10% of the paid subscription revenue.

Free newsletters

A free subscription allows readers to receive newsletters or posts from a writer at no charge. If the content is offered for free, all subscribers will have access to it.

Paid newsletters

A paid subscription allows publishers to monetize their content. Subscribers pay a recurring fee, usually monthly or annually, to access exclusive content. The cost of a paid subscription varies, as the writers set it themselves, although most subscriptions cost between $5 and $15.

How to use Substack

Substack is straightforward enough — follow the steps below to get started:

  1. Sign up for Substack

Your first step should be creating an account. Use your email address or your account on X (former Twitter). You will be ready to start setting up your profile after confirming your username and email address.

  1. Set up your profile

After verifying your email, you will be prompted to set up your Substack profile. This typically involves providing your name, creating a username, and adding a profile picture. Consider using your full name, or the name that most people know you by online if you use a pseudonym.

  1. Choose a newsletter name and URL

Name your publication, give a summary of what it is about and confirm your URL.

When choosing a name, make sure it is relevant to the content of your future newsletters, and is simple and memorable.

The summary of your publication should be as short and descriptive as possible, and should signal to your target readers why they might want to subscribe. 

Every Substack is assigned a unique URL domain in the format of “domain.substack.com”. Publishers may also choose to set up a custom domain name without the word “substack.” Adding relevant keywords can boost your Substack’s visibility in Google searches.

Here are some examples of catchy names, URLs and descriptions by Substack users:

Climate change newsletter Heated on Substack
Heated, a climate change newsletter
Newsletter about dumplings on Substack
Above the Fold, a newsletter about dumplings
Newsletter featuring music recommendations on Substack
Flow State, a music recommendations newsletter
  1. Customize your newsletter

Substack offers several options for customization, and you do not need to be proficient in HTML to use them. You have the option to personalize your Substack by choosing various colors for your publication’s background, selecting different fonts, and adjusting the publication layout. This simplicity is both an advantage and a drawback, as it limits customization options.

Customization options on Substack
  1. Set your subscription options

As we have established earlier in the article, creators can provide their content on Substack for free, or they can charge readers a recurring fee for access. Paid publications and subscription plans may be set up in Settings: 

Subscription options on Substack

You may want to publish some posts for free while hiding others behind a paywall. For example, British political activist Gina Martin provides one free newsletter a month, encouraging users to subscribe for more content.

Gina Martin’s newsletter

Additionally, authors have the option to publish a free preview of a paid post for free readers. This is what the paywall message looks like:

Paywalled post on Substack

If you have not turned on paid subscriptions on your Substack yet, you can use the Pledges tool to offer a way for your audience to express their support. This feature enables subscribers to pledge to become paid subscribers in the future if you decide to enable paid subscriptions.

When readers subscribe to your newsletter, they will have an opportunity to pledge a yearly, monthly, or founding plan. You can change the suggested subscription pricing in settings:

Pledge system on Substack
  1. Create your first post

Once you create your publication, the next step is to publish your first post. Substack allows users to publish on the web, email and its app simultaneously. Check out our guide on how to create an email newsletter

This is what the four types of posts  look like when viewed on the website:

Creating a text, video, podcast or discussion thread post on Substack
  1. Plan your content strategy

Planning a content strategy involves several steps, such as: 

  • Define your goals. Determine what you want to achieve with your Substack publication. Are you looking to inform, entertain, educate, or inspire your audience? This also applies to starting a business newsletter on Substack — while email newsletter subscribers have greater purchasing intent, it is important to bear in mind that Substack was not designed as a marketing tool and lacks the functionality for many business purposes.
  • Know your audience. Understand who your target audience is and what they are interested in. Conduct research and collect feedback by prompting your audience to comment on your posts, consider adding polls to your Substack posts and analyze data to identify your readers’ preferences.
  • Plan a content calendar. Create a content calendar laying out the topics, themes, and publication schedule for your newsletters. 
  • Make use of marketing resources online. Substack itself offers many tools to independent writers. These include networking events,  posts promoting authors, and sharing of best practices. If you are just getting started, or if you would like to learn more about marketing, consider taking an email marketing course.
  1. Promote your newsletter

To thrive, your newsletter needs a steady flow of news subscribers. To get those:

  • Grow your community: include family, friends, and contacts on your subscriber list. If you already have one and want to transition from another platform, you can import your existing contacts by uploading a CSV file. 
  • Link to your publication: add your Substack URL to your email signature, personal website, and social media bios. On social media, post when you start your Substack and whenever you publish new posts. When posting on Substack itself, be sure to use buttons, email headers and footers to ask readers to comment and share. 
  • Consistency is key: according to Substack’s data team, there is a strong correlation between posting frequency and publication growth. Therefore, you should post consistently, at least once a week. 
  • Work with others: collaborate with other writers via guest posts, guest features, interviews, and Q&As.
  • Use Substack features: Substack continues rolling out features such as recommendations and apps to help creators with growth and marketing. According to the platform, in 2022 it drove 40% of all free subscriptions and 12% of paid subscriptions, in comparison with 10% of free subscriptions the year before. Make sure to use these tools.
  1. Engage with your subscribers

The simplest way to engage with your subscribers is via comments — ask questions, and encourage your readers to leave comments on your posts and reply to each of them personally. 

The key to more in-depth engagement is knowing your audience, and personalization, to increase content relevancy. Criteria might include age, location, profession, and interests. 

When a new reader signs up for your subscriber list, they receive a “thank you” email from Substack. Use this space to reach out to your subscriber base by directly asking for information that is useful for you to know about your subscribers. Surveys and polls are also effective for collecting feedback.

Whenever possible, personalize your communication with subscribers by addressing them by name and acknowledging their support.

  1. Continuously improve and iterate

Once you have published a few newsletters, consider what steps you can regularly take to improve your Substack:

  • Refine your content. Focus on creating high-quality content that aligns with your audience’s interests, and routinely evaluate its relevance.
  • Engage with subscribers. Engage with subscribers by responding to comments, encouraging feedback, and integrating their input into your content strategy.
  • Publish consistently. Maintain a consistent publishing schedule to keep your subscribers engaged. 
  • Promote it. Promote your Substack newsletter across different channels, including social media and your website.
  • Experiment and iterate. Experiment with different publishing schedules and content formats to see what works best for your audience. Continuously iterate and refine your approach.

Tips for growing your Substack newsletter

Many of the steps mentioned above, such as social media promotion and collaboration with other writers may be used to boost the growth of your Substack newsletter. For a more in-depth growth strategy, consider the following:

  • SEO optimization. Optimize your newsletter for search engines to improve discoverability and attract traffic. It is worth noting that Substack does not provide the same level of SEO customization as some other blogging platforms. For instance, users do not have the option to customize URL slugs. Substack itself suggests using your name in your Substack URL, writing a concise SEO title and linking to your profile everywhere.
  • Subscriber segmentation. Substack’s subscriber segmentation categorizes users based on behavior and preferences, enabling targeted content delivery. The segmentation process involves tracking and analyzing various subscriber metrics such as open rates, click rates, and subscription status, to create subscriber profiles.  Understanding subscribers’ interests enables creators to develop strategies for attracting and retaining subscribers. Targeted promotions and specialized content can be offered to specific subscriber segments.

Here’s an example of Substack’s filters and segmentation:

Substack mailing list filters and segmentation
  • Call to action: Well-crafted calls to action (CTAs) can turn passive readers into engaged participants. A successful CTA in a business newsletter should be succinct and striking. Additionally, a good CTA should align with the audience’s interests and the newsletter’s content. A CTA should be placed at the end of newsletter content to encourage action.

How to make money on Substack

When trying to decide whether you should switch to paid subscriptions, first consider whether you can commit to posting consistently. The best way to convert your readers to fans is publishing free and paid newsletters frequently, and sticking to a schedule. Even if you would like to build a paid subscriber base, remember that free content is crucial to successful paid newsletters.

According to Substack, 5-10% of free subscribers convert to paying subscriptions, with 10% being a rate to aim for. Therefore, focusing on growing your overall subscriber base will result in higher earnings.

Main competitors

Substack is not the only tool for a meaningful distribution and monetization of content. Platforms such as Ghost, Patreon and Medium also offer users opportunities to connect with their supporters, yet each of them serves a different purpose.

Ghost

Ghost is an open-source content management system (CMS) and blogging platform. It was founded in 2013 as an alternative to existing platforms like WordPress. Ghost offers tools to build a website, publish content, send newsletters and offer paid subscriptions to members. It also features built-in analytics and performance monitoring tools. Ghost’s primary purpose is creating websites and managing different types of content, whereas Substack was specifically designed for email newsletter creation.

Ghost home page
Source: Ghost

Patreon

Founded in 2013, Patreon is a subscription-based platform which allows creators to provide different kinds of content to their supporters, known as “patrons”. Unlike Substack, which is primarily text-based, Patreon allows authors to share perks such as behind-the-scenes updates, video and audio content, in addition to newsletters. Additionally, Patreon has several pricing plans, allowing creators to offer their patrons memberships with multiple tiers. 

Patreon home page
Source: Patreon

Medium

Medium is an online publishing platform that allows users to read, write, and share articles on a variety of topics. It offers writing tools for its creators, and allows readers to follow writers and publications, receive recommendations, and engage with articles. Medium offers a membership program and a Partner Program for writers to earn money based on engagement. Medium’s primary difference from Substack is its broader audience.

Medium home page
Source: Medium

In recent months, Substack came under fire for allowing its platform to be used by some questionable audiences, despite its Terms and Conditions prohibiting hate speech. 

If you also don’t feel comfortable using Substack due to such technical or ethical issues, here’s a list of 10 other resources you could use instead.

What the future holds for Substack

Given the platform’s huge popularity in the newsletter realm, it is not surprising that Substack is seeking to expand into other formats. Substack has already launched an audio publishing tool for podcasts, as well as features for interacting with video content. Just a few months ago, Substack introduced a new format of Substack.Notes for microblogging and resharing content. In the future, the platform may continue rolling out different formats such as audio newsletters. 

Alternatively, Substack may decide to add extra features to newsletters themselves — such as increasing personalization depending on the user’s location or interests.

Another possible direction for growth is analytics — the platform may roll out new tools to help writers optimize reach and grow.

Final thoughts

Substack represents a significant shift in the landscape of content creation and distribution, offering creators a powerful platform to share their ideas, stories, and expertise directly with their audience. While Substack is not without its challenges and limitations, its rapid growth and impact on independent publishing are undeniable. 

What are some of your favorite authors on Substack? 

All images are credited to Substack unless otherwise specified.

17 February, 2024
Article by
Anastasia Ushakova
Mathematics major, former breaking news editor, digital content creator, freelance English teacher, bilingual writer. Novice contributor at Selzy. Keen on learning everything about the world and on sharing it with everyone. Hobbies include art, travel, thrifting, photography, playing the Sims, fashion, eating Marmite and generally having a good time.
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