An email list is one of the most valuable online assets.
When building an email list often, it is easy to lump together several separate steps into one overall accomplishment.
For instance, new list builders will often fuse building the list and earning money as one step. The reality is, there are many steps between building the list and converting people into paying customers.
Here are the different phases of optimizing an email list for maximum profit. Each step has separate goals and several calculations to determine the success rate of each phase.
Here are the 4 components to optimizing an email list for maximum profit.
1. Building the List
Before you can monetize a list, you need to start building an email list.
The first thing to prove is:
- Can you build a list?
- Can you get the targeted audience to opt-in to your email list?
To build an email list you will need:
This is something to give away in exchange for the person’s contact information.
This is a page that promotes the lead magnet, and people can enter their contact information.
This page is for subscribers to download the lead magnet.
The purpose of this email is to deliver on what was promised (the lead magnet), introduce you and the business to the new subscriber, and set expectations for the relationship.
Once the lead magnet, landing page, download page, and the welcome email are ready to deploy, then it’s time for the next phase.
The next question we need to answer is “How are we going to get targeted visitors to the landing page?”
Traffic breaks down into two different types.
This can be in the form of media buys, like Facebook ads, display ads inside of other emails list, dedicated emails to other lists, etc
-Other Types of Traffic
This often free types of traffic such as guest posting on other sites, being interviewed on podcasts, newsletter swaps, etc.
Metrics to measure the success of the Building stage are:
Cost per Click
If we spend $300 on a banner ad and it generates 250 clicks, then we know it costs $1.20 per click.
Cost per Subscriber
Calculate cost per subscriber by dividing the total costs by the number of subscribers. So if the 250 clicks generated 100 subscribers, then divide $300 (the price of banner ad) by the 100 subscribers to get $3 per subscriber. This metric reveals how much it costs to acquire a subscriber.
Landing Page Conversion Rate
This calculation determines what percentage of people are opting into your list. If 1,000 people visit the landing page and 400 people optin to your email list, then your optin rate is 40%. Knowing the landing page conversion rate is important because it helps you predict the growth rate of your list based on the traffic visiting the landing page.
Many of the email service providers suggest that a landing page conversion rate of 20% is good. Most of my landing pages for my clients and me, get a 40-60% optin rate from cold traffic.
3. Engage the List
Once you prove you can build an email list, the next step is engaging the list. Engaging the list means how many people are opening your emails, how many people are clicking, are replying to you, and are they forwarding the email to other people.
Here are a few things you can do to engage your list.
Each time you send an email, make sure it is from the same sender. People will open emails when they recognize who the email is from. By sending emails from the same person, it builds trust with the list.
To engage a list, send emails at least once per week. Choose a day and time to send your email each week. Over time, people will start expecting your email.
The most important determining factor for engaging a list is the content. What is the purpose of your email? How do you deliver value? And are you continually hammering people with offer after offer? Or are you a source of valuable information?
The email’s content includes the subject line, the main content in the email, offer’s you make, types of email sent, and the relevancy of the content. To get the highest level of engagement, I recommend creating a content calendar where you plan your emails.
Metrics for the engagement stage are:
–Email Open Rates
Calculate this number by dividing the number of emails opened by the number of emails sent. This number is expressed as a percentage. This metric is a good measurement of engagement. If people are opening your email more than once, then the emails are delivering engaging content. If you send an email to 10,000 subscribers and 3,000 people open the email, then this is a 30% email open rate.
–Unique Email Open Rate
Unique email open rates are calculated by each person who clicks only being accounted for one time. Think of it as each person that clicks only gets one vote. Whereas with email open rates, one person may click multiple times, and each click is calculated. Calculate this number by dividing the unique email opens by the total number of emails sent.
This number tells the percentage of people who clicked on a link within the email. To calculate this number divide the total number of clicks by the number of opens divided by the total number of emails sent. This is often the second stage of engagement. As you build more trust and subscribers become more engaged, then clicks should increase.
–Unique Click-Through Rates
This is similar to click-through rates, except each person’s click is only counted once. Whereas with click-through rates, one person may click multiple times.
Conversion is a numbers game. If you are doing a good job building the list, creating engaging content, and subscribers are clicking, then the next step is conversion. Conversion is the number of people who purchase and also involves tracking revenue.
Here are a few things you can do to increase conversion rates.
How are you monetizing the email list?
What is the strategy for earning revenue with the list? Are you sending people to only one offer? Over time, are you promoting a variety of revenue-generating opportunities?
Offers can be in the form of physical products, events, paid newsletters, coaching programs, Masterminds, online courses, affiliate & Joint venture promotions, done for you services, and so much more. When planning the content start with the offer and then plan the content around the offer.
the copy of the email is the text. How do you present the products you promote? What you offer impacts how you present the offer. If you only offer one product, then how many different ways can you promote that one product? If you feature multiple products each month, then how are you going to promote each product? Copy can make a huge difference in promoting offers. Copy is one of the most critical marketing skills that can impact conversion.
Metrics for the conversion stage are:
Revenue per subscriber
This metric is calculated by dividing the total revenue by the number of subscribers.
Revenue per customer
Calculate this metric by dividing total revenue by the number of customers. This number reveals how much revenue each customer is worth. Also, it tells you how much you can spend to acquire a customer.
These numbers are significant because once we understand how much money it costs to acquire a customer, then we can compare how much money each customer is worth to our business. Once we know these numbers, then we can systemically start scaling the email list and the business. For instance, if it costs $17.50 to acquire a new subscriber, but each customer is worth $250 over the next three months, now we can start planning the growth of the list, along with the revenue.
Following these steps enables you to build a profitable email list. I create a spreadsheet and track each of these metrics with each email sent. This way, I can monitor the overall health of my list and how each email performs. By following these steps, it will help you build, engage, and convert subscribers into paying customers.
Are you building your email list?
Today, when it comes to building your audience one of the most profitable marketing channels is email.
According to the Direct Marketing Association, email marketing yields a 4,300% return on investment for businesses in the United States.
ExactTarget reports for every $1 spent on email marketing, the average return on investment is $44.25.
One of the most profitable ways to build your audience is to increase the size of your email list.