How Copywriting Royalties Work
Writers often think you have to be James Patterson, Dan Brown, or J. K. Rowling to make a crazy amount of money as a writer …
But it’s simply untrue.
Direct-response copywriters have just as much earning potential … possibly more … thanks to the royalties they receive year after year from letters they once wrote. (And as I’ll explain in a moment, that’s on top of the big fee they were paid to write the letter in the first place.)
It’s how “A-list” copywriters like Carline Anglade-Cole, Jedd Canty, and Mike Palmer make millions each year.
To illustrate how royalties work, I’m going to use the financial market because it’s fun to look at the numbers … and happens to be the niche that has created the most million-dollar copywriters. You’re about to see why …
In the financial niche, a client might ask you to write a letter that promotes a specialized financial advisory service that costs $1,000 a year for a subscription.
Now, you might be thinking, “$1,000 a year — for a newsletter subscription?!”
Yes! Avid investors routinely pay anywhere from $100 to $5,000 a year for specialized financial insights. So, no worries there. People will pay it.
You agree to write the letter and negotiate an up-front writing fee. How much you get depends on your experience. (Experienced writers in this niche charge $10,000, but some charge a lot more … $25,000 and up.)
Now that’s just to write the letter …
It gets much better.
After three or four weeks of writing, editing, and polishing, your letter is finished.
You send it off to your client by email and he or she does another round of final editing … gets it to a design crew, who readies it for printing or posting online …
Then your letter is sent to a list of people who have signed up to see new financial letters like the one you’ve just written. (Important: Your letter is never sent as unwanted spam. These are people who have “opted-in” and have agreed to see what you’re writing.)
A few days later, your client tells you that 1% of the people who saw your letter loved the idea you wrote about … and paid the $1,000 to subscribe to the newsletter you were promoting.
Again, I can almost hear what you’re thinking:
Only 1% — that’s 1 out of 100.
Boy, that must have been a pretty bad letter!
Okay, maybe it wasn’t the best letter ever written …
But here is what’s great about it:
It’s still enough to make you a lot of money. That’s because 1% of 100,000 means 1,000 people were persuaded enough by your letter to subscribe.
And at $1,000 each — that’s a cool $1,000,000 in sales.
Boy, is your client happy! Your letter just made a million bucks walk through the door!
And here’s that “better” part I mentioned:
Copywriters typically get paid a royalty on every sale — anywhere from 2% to 5%.
And remember — that’s on top of your up-front writing fee.
It’s like a commission … or a bonus.
So now let’s tally up what this one letter that got a 1% response ended up paying you.
You got your $10,000 writing fee, up-front …
Your letter helped sell $1,000,000 worth of subscriptions. At a 3% royalty — that’s an extra $30,000 you’ll be paid.
Altogether, that’s $40,000 …
Do just six of those a year and you’re looking at a $240,000 income …
Now, let’s say you wrote a really great letter … and the response was 2% instead of 1%.
So instead of $1,000,000 in subscriptions, your letter sells $2,000,000.
Now your royalty is $60,000 — for a total payment of $70,000!
Imagine you do six of these letters a year — one every two months.
$70,000 x 6 = $420,000!
And here’s the best part.
If you write six letters a year — and it takes you a month to write each letter — that means you have six months of “off” time … time you could be travelling … golfing … anything at all!
Or you could decide to use that time to write three or four additional letters a year — make even more money … and still have two or three months a year to spend as you please.
Are you starting to see the big picture here?
And if you really hit a home run with a letter you write — the money can be almost obscene.
Recently, for instance, a colleague we know and work with here at AWAI wrote a letter that sold $10 million worth of financial subscriptions.
His potential share?
From just one letter!
Another gentleman we know wrote a letter that was used over and over again for over four years … and earned him in excess of a million dollars for about two months of work all-totaled.
Imagine what it would feel like having a $30,000 or $40,000 deposit show up in your bank account — for a letter you wrote years ago …
And having it happen time after time after time!
Now I realize that’s not the norm, but even if you scale the numbers way down …
Let’s say you charge only $5,000 to write a letter for a supplement company …
The letter sells $100,000 worth of product when it mails, and you have a 3% royalty arrangement.
That’s $3,000 that shows up for not doing any more work. And any time they mail it … you get another check … for as long as they continue to mail it!
And that’s only ONE letter …
Most trained copywriters who’ve completed The Accelerated Program can bang out a long-form sales letter every 1-2 months. And even if only a few letters become winners (otherwise known as controls), you can see how quickly the royalty checks would add up.
Imagine only two of your letters every year turning into controls …
By year five of your career, you would have 10 letters paying a royalty every quarter. You’d more than likely be well on your way to making a six-figure income. And that’s money you are earning from something you wrote years ago!
Do you have any questions about copywriting royalties? Please share with us in the comments so we can get you the answers.
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Hi Rebecca; I've been wondering if the sales copywriter sees proof of the amount of subscriptions sold via the sales letter; or just takes the client's word for the amount of subscriptions sold and royalties earned. How does that part of the process work? Thank you!
Guest (Roberta) –
Which other projects can royalties be applied to?
I, too, would like to know the answer to Roberta's question, on how the "audit" and verification side of these transactions work.
Persuacious --PERSUAsive - audaCIOUS –
@Roberta and @Persuacious - the client typically provides this information. But if they're smaller or don't have a formal process in place when working with copywriters, you might need to ask.
With regards to "trusting" or "auditing" the information, my advice is always not to worry about it. You want to write for clients you trust. You don't want to start off assuming they'd deceive you - that's never a good way to start a relationship. And if a client gives you a reason to think they might not be ethical, walk. That's one of the many benefits of this career - full control over who you work with.
Rebecca Matter –
@marion - projects where your copy is directly impacting the sale. So potentially things like landing pages, email funnels, etc.
Rebecca Matter –
RM: That's a wholesome attitude and sage advice.
Yet, I think of President Reagan quoting a Russian proverb to Gorbachev: "Trust, but verify." So-Must I forbear writing for any Gorbachevs? (Some deep pocket clients there!)
It's not necessarily mistrust. Small clients,as you note, lack capability to track sales accurately. An impartial tracker would be fair to both sides, accurate and avoid disputes. Do you know of one?
Persuacious --PERSUAsive - audaCIOUS –
@Persuacious - I don't, as I've yet to hear of a copywriter auditing their client - there's are a few issues there, going back to trust. And am not sure small clients (in your example) would be able to pay for a third party auditor. But assuming they're selling digitally, whatever ecommerce platform they're using will have reports complete with tracking. Good luck!
Rebecca Matter –
Which are the available systems for a copywriter to control the real sales? How can you be sure your client is not going to tell you the sales were lower to avoid paying you what was agreed?
Guest (Carlos) –
Hello, I just listened to a long introduction on what a Copywriter does from Barefoot Writer and found it intriguing. My question is how you set up things on your back end...are you self-employed with your own small business? With no steady income,is there a way to not setup that way?
Guest (Rebecca ) –