An interview with Justin Pardee, Raincross Gazette
Justin Pardee, owner and publisher of The Raincross Gazette, a Nnwsletter-first revenue model, was the top over-performer in the newsletter advertising category in the 2025 Niche Revenue Survey.
The below transcript, edited for clarity and brevity, shows how he evolved the revenue model.. See the full case study here.
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Alisa Cromer: One of the most underutilized revenue opportunities for media is newsletter advertising.
Everybody has has newsletters, and 73% of publishers in the study sell ads on newsletters. However, the traditional print media company thinks of a newsletter as driving traffic to the website, where they sell ads against content.
Justin Pardee: Right.
Alisa Cromer: And they also don’t use frequency, such as three days a week, that you’re using.
But before we talk about that, can you tell me a little about Riverside, California?
Pardee: My metro area is 320,000 people. We’re between Los Angeles and Palm Springs, so in 25 minutes in every direction, there are 4.7 million people here.
Cromer: I know that area, it’s a big, sprawling group of communities. How did you get started in this business?
Pardee: I’ve been an entrepreneur my entire life. My father was a business professor. I started Toastmasters the same week I started kindergarten and did it.
Cromer: Are you kidding? That is crazy.
Pardee: Oh yeah. Every single week, I gave a two minute update on what was happening in town based upon my daily reading of the local section in the news. So that’s how I started paying attention to local news.
And then I’ve been a serial entrepreneur. I love doing stuff. I’ve built e-commerce businesses and sold them off. But immediately before this I co-founded a branding, communications and strategy agency. However, the idea of an email-first, digital local newspaper was been in my head.
Then during 2020, all kinds of things were going wrong in our community. One of the things that was going right was that people suddenly began to realize what an impact local governance had on their daily lives. It was the county’s decisions about masking policies, opening of businesses and those kinds of things. Then when all of the schools in California were shut down, school board meetings got a little crazy with the public commenting. During 2020 here in California, there was a YouTube live stream after midnight, with over 3,500 people watching, because we all knew it was the only way we would find out if our kids would go back to school in the next month.
Cromer: Another pandemic start up. I’m going to jump right in to ask about your newsletter model
Pardee: One note on that, I sold only newsletter advertising until October of last year. Then I began also running digital display ads on the website, which are sold as la bonus. The newsletter is what people care about, so I exclusively think about all my advertising revenue through the lens of the newsletter
It’s always been newsletter first. Always, always, always.
Cromer: So when you added an extra day to send the newsletter, bringing it to three days a week, was that in part a way to increase revenues?
Pardee: We started with Tuesday and Thursday. I was following the Morning Brew model, so I had a top level, midlevel, and lower tier, and you could buy text links.
At one point the top and mid levels, were sold for six months out, which was a great situation to be in. So to grow the business, the only thing I could come up with was to add more inventory by adding another day.
So I launched a Sunday newsletter. My Tuesdays and Thursdays were really built around civic content – our city council meetings are on Tuesday nights. On Sunday, I, began introducing some lifestyle content.
Cromer: So now do you do you sell by the week?
Pardee: I did that for about six to nine months. I was selling $125, $50 ads at a time. I had a really good tool set that worked, but it had two complications. First, it was just a significant workload for me as a solopreneur. And second, I started to have larger organizations wanting to buy.
When the first really big organization said, “let me see your media kit so we can do an extended ad buy,” I was like, oh, I’ll get you that, tomorrow. Then I stayed up all night and made a media kit that bundled some advertising. Within 48 hours, I had a signed contract for $30,000.
Now I sell annual partnerships, but also offer some limited run campaigns.
Later today, I have a scheduled appointment with the Riverside Cookie shop, and I’m looking at bringing her in at my lowest level tier for annual advertising partnerships.
Cromer: How do you structure the pricing and packaging?
Pardee: There are three tiers of advertising. The lowest one is $5000 a year, with 20 advertisers. You have to at least be in the middle tier before getting exclusivity by category, and that is 1o advertisers. The top tier is $30,000 with 5 advertisers.
I’m very selective about who I sell to. Me and my wife had lunch recently with a local influencer and I told him, how we followed his ecommendation and went to a restaurant and it was garbage. And he’s like, “oh yeah, I know. Sorry about that. It is horrible. But they’re paying me. What are you gonna do?”
I was like, oh, well, okay. The one thing I learned is that he had no credibility,
Cromer: Do you also sell content marketing?
Pardee: Yes. If you’re at the lowest tier, you get one sponsored story a year. The middle tier, you get two per year. The top tier, which is limited to five advertisers, has one per month. Those, those are all labeled as sponsored stories on the website, but they flow through the content.
Cromer: I think, that makes a lot of sense.
Pardee: The reason who I bring on as an advertiser is crucial is that I’m still less than two years into building this. We are still earning trust from readers and maintaining that trust is important.
For two years in a row I have surveyed my paid members, asking “Would you like to have no ads in your newsletter as a perk of your membership?”
And they say no, they want the ads. I’m not running national ads for Dove soap, I’m running advertisements for local businesses.
In the world I come from in marketing, there’s this concept of signaling, meaning the focus a service provider puts on something signals their values.
For my paid members, when they see organizations that are advertising with me, they know one of two things. Number one, they’re serious about their product because they’re going for it and Justin has let them in.
Cromer: How many subscribers do you have?
Pardee: I’ll pass 10,000 unpaid email subscribers by the end of the month.
Cromer: That’s exceptional.
Pardee: I just passed 9,700 yesterday. My goal was 16,000 by the end of the year, which would represent 5% of the total adult population in the city. I’d like to hit 25,000 by the end of next year.
I switched away from the pay per month model in early 2022, because it was just limiting my growth. I still invite people to become paid members, but the focus is on growing the email list.
We have an ongoing persistent paid acquisition campaign that’s running on META and Instagram, inviting people to become a subscriber for local news.
In the last two years, I’ve maintained a 65% open and engagement rate for the newsletter because we’re just relentlessly obsessed with the quality of the content. We have to be so good that it that people feel like it is a valuable use of their time in the morning.
On the Sunday newsletter, below a topper which is my personal introduction, we have a little block that says thank you to all of the subscribers who became paid supporters this week, and we list their names.
Cromer: So, now let’s talk about your content management system. I saw that called Ghost,
Pardee: Yes. Ghost is a, fairly well respected, open source content management system.The Atlantic is powered by Ghost. It’s an open source, non-profit, so you can use it for free, just like you could with like a WordPress website and bring your own hosting. We are on the Ghost Pro Plan, which means we pay them to host. The Atlantic is powered by Ghost for the content management system.
Cromer: Let’s say that, you wake up at 3 AM and you got a s great idea. With WordPres you can typically find a plugin and hire somebody to customize it to make it work the way you want. Is that what you can do with Ghost?
Pardee: Ghost does not have a really big, robust, plugin world l like WordPress does. I think that’s probably for the best. We bought a $175 theme from a reputable developer who lives in Denmark. If I have things that I’d like to do to the website, I just shoot him an email, and pay him $450 or something like that.
Cromer: I often think publishers can get trapped in their CMS because it was built for traditional media models. Then the CMS provider won’t iterate unless most of their clients want it, but that’s not great for niche publishers who are all a little different.
Pardee: Right. The success of the old model essentially was built on a monopoly, right? There was a local monopoly on advertising and communication in the city. That’s not what I am bringing to this. I’m concerned about how I get people who don’t give a rip about local news to read it.
How do I get them to care? How do I make sure they open my emails?
Cromer: I always wonder when I hear that media wants to be sustainable. Don’t they want to be more profitable?
Pardee: Let me tell you why I think the goal sustainability is so mission critical. PressForward and Google and Facebook give millions in grants. They are putting hundreds of thousands of dollars into these little tiny newsrooms that have no long term viability. Because if you don’t have an audience that is wants you in their driveway – metaphorically – if somebody doesn’t wanna walk out in their bathrobe the second that newspaper hits, then you’re not sustainable.
Cromer: How is it going financially so far?
Pardee: In 2022, I did $13,000 gross. 2023, I did $47,000 gross. 2024, I did $228,000, and then this year I am targeting $375,000.
I’m not making a lot of money. In fact, this is the lowest salary I’ve ever made in my life. My one reporter – who was not a trained reporter when I hired him – I’m paying him well. We need to have three to four more people on the team. So we’re baseline producing this.
Cromer: So what I’m hearing you say is that when you say sustainability, you mean as opposed to grant-funded media, that does not need to make a profit.
Pardee: Yes.
Cromer: And can tell me really quickly, who else is on your team?
Pardee: It’s me, a reporter and then I have a content manager. She emailed me to see if I needed a copy editor, and I said, if you can learn how to also publish the articles on the website, then I could afford you. She also puts the finishing touches on the newsletter. We all work on it, but she finishes it up.
Cromer: Well, I this has been really fascinating. I hope you get to your $375,000. I’m sure you will.
Pardee: Thank you so much. Pleasure to meet you.
