Should You Leave Mailchimp to Save Money?

November 25, 2020

saving money in piggy bank

Without a doubt, Mailchimp’s email marketing service offers a lot of value to news sites and for that reason it is hugely popular. In fact, in our recent review of local news websites, Mailchimp was used by over 50% of publications.

But Mailchimp can get expensive as your audience grows, you get more subscribers and you start sending more emails. And Mailchimp’s unclear pricing can lead to some unpleasant surprises.

Can your media business save money if it leaves Mailchimp? And are the cost savings worth the effort?

We crunched the numbers to find out.

First, let’s understand Mailchimp’s pricing

On their website, Mailchimp lists their pricing according to your number of email contacts and if you are signed up to their Free, Standard or Essentials level of services.

Something important to note here, is that “contacts” doesn’t mean “subscribers”, and this was actually a very important change that they made to their pricing in June 2019. The difference is that Mailchimp used to charge based on email subscribers, which means that if someone unsubscribes from your email newsletter you wouldn’t get charged. In the new plan, you still get charged for un-subscribers until you archive them.

This is not the most intuitive so be sure to keep up to date on archiving contacts you don’t want to pay for.

(Note: if you were already a Mailchimp customer from before this time, these pricing changes don’t apply to you and you are simply charged based on your number of email subscribers)

At the same time, Mailchimp also put in place “overage charges” which essentially penalize you for being in the wrong pricing group. So for example, if you are on a plan for 5k contacts and you go over that in a month, it will actually cost more in overage charges than you would have paid for increasing your plan to the next level.

Again, a little bit sneaky and something you should monitor to keep your cost in check. There’s a great write-up from the Mailchimp consultancy Chimp Answers here that describes in even more detail.

What other email marketing services are out there?

As we were reviewing the technology behind 100 different news sites, we saw a wide variety of email marketing services. Mailchimp was clearly the most popular, but there was definitely lots of experimentation.

We’ve gone through and done a cost comparison of all of the most popular email marketing service options that we found in our review - with a couple of exceptions.

The reason for those exceptions is that there are some email services that we want to be clear that we don’t recommend.

The first of those is Feedburner, a free email service by Google that is widely rumored to be discontinued. Given the uncertainty around its future, we don’t think it is something that you should be building your newsletter strategy around. Also it fits more with the strategy of just sending your new articles out via RSS feed rather than treating your newsletters as a core part of your content offering. (where we think it belongs)

We also saw some publishers using Amazon Simple Email Service, which can be very low cost, but it is more of a do-it-yourself set-up which we don’t see having wide appeal.

Finally, we also saw some email newsletters sent directly through their CMS platform such as WordPress or Townnews. Without a doubt this will be cheap way to send emails, but again we don’t see it as being effective enough at creating interesting newsletter content.

So those are all of the email marketing services that we don’t recommend, here are the services that we did compare:

Pico and Constant Contact were the second and third most popular email marketing services after Mailchimp in our review, while the other options we observed being used by couple of sites here and there. We didn’t observe anyone using Mailerlite, but we threw it in there because it is a low-cost email marketing service that we have been happy with so far at Epilocal.

Let’s see the cost comparison

comparison table of email provider pricing

When you lay it all out clearly, Mailchimp is definitely one of the more expensive services, but not the most expensive. Constant Contact, which is the third-most popular email marketing service that we observed, is actually more expensive than Mailchimp pretty much across the board.

In general, the bigger savings do not kick in until your email list size grows above 5,000 and even then it is less than $100/month in most cases. You can compare the numbers for yourself and for your own list size, but considering the effort to uproot campaigns and transfer subscribers to a new platform, it is easy to understand why many news sites are sticking with Mailchimp.

Should you ditch the Chimp to cut costs?

Along with the range of plugins that make it a natural fit for WordPress, you still can’t really go too wrong with Mailchimp’s email marketing service. Mailchimp also has an extensive API that makes lots of integrations possible, like bringing Mailchimp data into Google Data Studio.

For startup publications who are watching every cost and are ready to try something new, there are definitely options out there to try that will save money while offering premium features.

But for the established publications that are out there now, we don’t see any ground-breaking offer that will make it worthwhile to ditch the Chimp on the basis of cost savings alone.

Just be sure to keep your list up to date, archive any contacts that are no longer subscribed and check your bill every month to make sure you aren’t being hit with overage charges.

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