My Thoughts On eMail Marketing
March 15th, 2008 | by ScottIt appears that you're new here, if you like what you read, please subscribe to the news feed or sign up for the Leap eTips news and updates email list. Thank you for visiting :)
I received an email yesterday from John. You don’t know John, actually I don’t either, but he’s a reader of my blog and has been trying frantically to turn his web sites into a profitable venture. I won’t disclose any of the details about John’s sites, but I’ll sum up his situation like this:
John’s been reading everything he could get his hands on about making money online. He’s spent a small fortune buying eBooks, special reports and Guru’s systems. After 8 long months of devoting 2 to 3 hours per evening (after coming home from his day job) plus long weekend hours John has nearly $3,000.00 and tons of time invested between building his sites and buying all this “help”, and John has made less than $500.00 back in revenue to show for it.
John explained his situation to me because he’s thinking about borrowing the money to buy another program. This one is about email marketing. All the in’s and out’s of list building to get yourself tens of thousands of email subscribers which will hopefully convert into sales for you once you begin sending them mailings every so often; and John wanted to know if I knew about this program and thought it was worth the money or not.
I answered john’s email personally, but also wanted to post this here (with John’s approval) for others who might be in a similar situation, or even just headed down this same path.
When it comes to email marketing I have a love/hate relationship with it.
It is a great way to boost your sales, there’s no doubt about it, but it’s far from the great tool it once was. In fact, when I started out online in the mid-90’s you just needed to put a subscription form on your web page and look out because almost everyone who landed on your site would offer their address up.
When you sent out a mailing nearly all of your subscribers would open it from their inboxes and response rates were pretty good.
Today, it takes free offerings and bonuses just to get someone to share their address with you, up to 40% of those will be secondary free account email addresses that people use to avoid getting your later offers and sales pitches at their real email address, and another 5% to 10% will subscribe to get the free offering and then unsubscribe after you send out the first message.
That’s up to 50% waste for the time and efforts you put into building your list.
And of the remaining subscribers, if you’re lucky, you might see a very small response rate with each mailing you send. Someone, and I think it was those Wealthy Affiliate guys, put out a book on email lists and mentioned a .05% response rate as being positive? I’m sure someone will correct me if that’s wrong but I seem to recall that being the general idea.
So, all that effort, time and money to put together a “bonus package” and then market your list subscription landing page to build up a mailing list that’s 50% useless, and get a .05% response rate from the rest? That hardly seems worth it to me unless you’re getting 3 digit commissions from every sale and sending out several mailings per week.
But I also said there was love involved in my relationship with email marketing so I want to explain that as well.
I do have several email lists that I maintain. Each is in a different niche, and all have the same rules that I apply to the eTips newsletter here at the blog: no more than 1 monthly mailing to the list and no more than 10% of each mailing can be aimed at benefiting me in any way. Meaning at least 90% of each mailing has to be informative and helpful to my subscribers.
I also don’t push for list subscriptions. I never put bonus packages together just to build a big list, so my lists are pretty small compared to other folks.
One of my lists is 3 years old now and has just 488 subscribers. But guess what… because I haven’t used gimmicks or other stuff to build that list, I’ve just grown it naturally by having a good site with quality content and a subscription form in the sidebar of every page, the people on that list are very responsive to my mailings.
How responsive? In my January ‘08 mailing to that list I promoted a CPA offer for a related community–I earned for each referral that joined the community. I didn’t use any invented stories to promote the site, no hype, I just mentioned at the end of my message that readers might find “this site” interesting because it was related to my list’s niche.
47 of my list subscribers joined the community within 48 hours of sending out my mailing, and another 17 joined over the following days. That’s 64 conversions from 488 people.
Or… that’s a little more than a 13% response rate. Much better than that .05% I mentioned earlier, huh? At .05% I would need a list of about 12,200 people to get 64 conversions… what a waste of energy and resources in my opinion.
In the February ‘08 mailing I included an offer for a software program that I thought people in this niche would be attracted to. It was an $80 software and fairly new on the market so I wasn’t sure what to expect. But, the software maker had approached me with a free evaluation copy and a sweet commission offer. I was impressed with what the program did so I gave it a shot and mentioned it, again without any hype. I explained to my list that I had received a free review copy of the program and was impressed with several features which I briefly described and pointed out the benefits of each.
In total 83 subscribers from my list have purchased that software in the last 3 weeks. That’s about a 17% response rate.
So you see, I do love mailing lists. I just don’t have the time or inspiration to work with or try to build these massive and non-responsive lists everybody’s (usually those trying to sell a list method) always bragging about.
My advice to John, and anyone reading this is to certainly explore email marketing, but be smart and thrifty about it. How does (would) a mailing list attract and benefit you? What would keep you reading the mailings of someone time after time? Answer these questions and you’ll be able to create a good list for yourself.
Don’t buy into the “big list” hysteria.
Build a natural list of people who really desire more from you. These are the folks who don’t need special offers to give you their addresses, they’ll willingly give them if you have a quality site and just make your subscription form visible–and they’ll be highly responsive to the mailings you send them so don’t abuse these people. Make your list worthy of their time first, then allow yourself a little promotional room with it.
Don’t worry about how slow your list develops, and take the time to cultivate it as it does. Wow the socks off of those who do subscribe and pretty soon you’ll have a strong subscription base that takes action on the offers you do send them.
Stumble It!
4 Responses to “My Thoughts On eMail Marketing”
By Paul Broni on Mar 19, 2008 | Reply
First of all, John should not borrow money for this kind of education. There are many good resources for information on email marketing. For example, the MarketingProfs forum is full of professionals willing to give away their knowledge if someone asks a genuine question in their search for help. There is very little “noise” there.
As for email marketing, it’s not a magic bullet. It can’t take a bad business and make it better. People get drawn in by the idea, however, that they can assemble a free email list of 50,000 people and then market to that list as often as they want for next to nothing.
Thing is, it’s a lot harder to build a list–let me qualify that…a QUALITY list–than most people think.
I like to think about it this way. A truly good quality email list that is available for rental will cost anywhere from $150 to $400 per thousand names. Please note that I am not talking about the garbage-sellers in Florida who will rent you names for a buck a thousand.
So each time a good email address gets rented, that’s between 15 cents and 40 cents in income for the owner. (Let’s ignore commissions and all that.) If the name could be rented for twice a month for two years before going bad, that would be between $4 and $10 in income per email address. That pretty much means that the value of an email address is at least a few dollars. This is probably low, too, when you consider that just getting a single click from PPC can cost you anywhere from a quarter to five bucks or more.
As a result, a 50,000-name email list would be worth at least a hundred thousand dollars, wouldn’t it? And yet people think that they can build such a list for a couple hundred dollars or a few hours of their time.
The point here is not that my numbers are accurate, but rather that a good email list is a valuable asset that does not come cheap. As they say, “If it were easy, everyone would be doing it.”
By new zealand news on Mar 19, 2008 | Reply
I have to admit I consider email marketing to be dead. Getting through spam filters is tough enough, and that doesn’t even guarantee the reader will even open it. Let alone respond the the email as you would like them to.
By Paul Broni on Mar 19, 2008 | Reply
It’s pretty far from dead. We’ve been at it for almost ten years now.
Done right, it can be an important part of an integrated marketing effort.
You may not be able to build a whole business around it as a marketing tool, but it’s useful and cost effective.
By John Stewart on May 17, 2008 | Reply
Email marketing is a probability calculation:
p1: chance of addressing the right person
p2: chance of bringing the appropriate message
p3: chance of sending at the right moment
Thus the total chance = p1 times p2 times p3
Something like: 0.3 x 0.1 x 0.05 = 0.0015 or 667 emails for one click on your website. And then the visitor needs to visit pages on your website in order to qualify him as “Lead”.
Hence the need for massive amounts of emails.
On the other hand, people do find your website by natural search. This requires content and links. Content you can write, obtaining links depends from others.
In case of B2B, a website visitor identification solution, which reveals company names of your visitors is a completely different approach. In that case you need to have visitors on your website, but these are people who are probably interested as they came “naturally”.