A seven pound monthly subscription is not seven pounds. By the time it reaches your account it has been through a payment processor, a refund or two, and the slow leak of people quietly cancelling, and the figure left is the one that actually runs the business.
The processor takes the first bite
Card processors charge roughly one and a half percent plus around twenty pence a transaction, and on small monthly payments the fixed fee hurts more than the percentage. Billing annually instead of monthly cuts the number of transactions, and with them the fees, which is half the reason publishers push annual plans so hard.
Churn is the bite you cannot see
Every month a slice of subscribers leaves, and on a monthly plan that slice is larger than most people admit, often in the mid to high single digits. A list that looks like it is growing can be standing still once you net off the leavers. The figure to track is not sign-ups but net additions, and the number to price around is what an average subscriber pays across their whole stay, not in month one.
Work in net, not headline
Take the headline price, remove the processor’s cut, allow for refunds, and divide by a realistic lifespan, and you have the honest value of a subscriber. It is always lower than the sticker, and planning on the sticker is how newsletters overspend. The same net-not-gross habit runs through revenue and platforms, and once you cross the line the VAT question in registering for VAT takes another slice on top.
Written by Kate Lindqvist. General information on publishing economics, not financial advice; figures current for 2026.…