And The Fundamental Steps To Creating and Building A Profitable Email List…
In online marketing it’s rare you really “own” anything you’re doing. I know it sounds crazy, but if you think about it you’ll see that statement, unfortunately, is accurate.
I really started to understand the importance of owning and controlling important parts of my business about 12 year ago when I lost a multi-million dollar deal over this very thing.
I had an affiliate marketing business that was absolutely crushing it.
My model was very simple.
I ran ads on Yahoo! and Google, pushed the traffic right to my websites and in turn generated about $250,000 per month on average. I believe my ad spend was somewhere in the $30,000 range each month, so my profit was extremely high.
At some point I decided I wanted to sell my business and move on to something else. I listed it for sale and almost immediately had some interest.
I’ll never forget the one call though that changed how I look at my online business, and really brought to my attention the importance of an email list.
I was talking to a well-respected doctor who was interested in investing in an online business. He had looked over all the data about my business and was ready to make me a multi-million dollar offer to acquire it.
…. But then he asked the one question that blew the entire deal to pieces.
He said, “how big is your database”?
My answer “We don’t have one”.
That sealed the deal that there would be no multi-million dollar offer coming my way not only from him, but also from anyone else.
Everyone asked me “What’s going to happen if Google bans your ads? How will the business still make money?”
I could never answer that question. That uncertainty is all it takes to kill a big deal like the one I was looking to make.
I learned my lesson the hard way, however, you don’t have to make the same mistake I made.
So I wrote this short article to show you how important having an email list is to the long-term viability of your business.
It could be literally the only thing you actually own and control.
In this article I outline 4 steps you need to take in order to build a profitable email list for your business.
If there’s one thing I want you to remember it’s that SIZE does not matter nearly as much as QUALITY matters.
Keep that in mind and let’s go over the 4 steps you need to take right now to build a profitable email list.
Step 1: Choose A Profitable Niche
I’ve seen so many “list building trainings” that completely leave this step out of the equation.
If you’re looking to build a profitable email list you’ve got to first make sure the niche you’re in can even be profitable!
Obviously if you’ve got your own product or service to sell then you can skip this step because you’ve got a way to monetize the list you build, but if you’re brand new to business and just starting out choosing a niche is key.
One of the ways I usually identify profitable niches is by looking for offers on affiliate networks like ClickBank, JV Zoo or Max Bounty.
The best resource I have found to find many different affiliate networks is probably http://www.offervault.com.
One thing to be particularly aware of is that you shouldn’t just look for the niche with offers that pay the most money.
Offers can pay you for simply generating clicks (CPC), leads (CPL), sales (CPA) or they can share revenue with you where you get just a percentage of the sales.
Understanding these payout types is very key because it can make a huge difference in your profits.
CPL offers usually pay you for generating a lead, which means no sale has to take place for you to get paid. It’s also important to look at what information a person has to input for you to successfully generate a lead.
Some CPL offers only ask for a zip code or email address. You’ll find these “one field” submissions pay far less per lead generated, but obviously the conversion rate should be much higher.
CPA offers pay you for helping companies acquire customers and usually need a sale to trigger a commission. One of the things you’ll find nice about CPA offers is that you don’t participate in the refund side of the equation.
If you’re promoting an offer that pays you a revenue share usually that means you keep your percentage of the net profit. So if someone refunds you’ll have a deduction in your commissions.
It’s really about knowing the offer, knowing the audience and understanding the payout methods.
We’ve found many niches are profitable with simple CPL offers such as auto insurance, health insurance, education and even legal lead generation.
Choosing a niche is important because an email list with nothing to generate revenue from isn’t going to make you much money.
Step 2: Offer A Great Lead Magnet
Once you’ve selected your niche the most important thing you can do is create a lead magnet that brings in the right leads.
I’ve seen so many people offer “free money” or some type of contest or vacation to generate leads, but that’s not building quality it’s just building quantity.
As you’ll find out later in this short report if you don’t have the right people on your list it will completely screw up your delivery and overall ability to generate clicks and revenue from the list.
So the quality really starts with the messaging you’re sharing with people on the page they subscribe to your list on.
I’ve found that a free book usually is the best lead magnet for almost any niche we’ve gone into online.
There’s a couple of reasons this usually works out the best.
1. People see VALUE when the think of books. We know what a book cost in a store and we instantly put that type of value on the book.
2. The book gives you the opportunity to educate your new subscribe on the topic and to build a great deal of trust and goodwill with them.
Bringing in the right audience is absolutely the key to a quality list but having a lead magnet that also builds trust and goodwill right out of the gate can’t be discounted.
So many people give away a free vacation or some cash only to build up a huge list and have absolutely no clue what to email to the list.
So the thing you’ll want to remember about this step is be consistent. If you are going to be in a specific niche then make sure your landing page and lead magnet bring in the type of people who would be interested in that specific niche to your list.
Step 3: Mail Consistently
Once you’ve built your email list it’s important to be consistent with your sending of emails to the list.
We’ve tested many different theories and have found if we mail our lists at different times of the day each day of the week we end up with better results.
I’ll give you an example.
Let’s say you are sending emails every Monday to your list and that just happens to be the day you’ve decided to mail.
If you have a portion of people on your list who’s work week starts on Tuesday and ends on Saturday then for them that Monday is a weekend. They may be spending time with family, away from the computer and simply not in the right place to read and respond to your emails.
Another example is when you send emails at the same time of the day each day. If you send at 11am every single time you send what happens to those who work the night shift? They would always be getting emails while they are at work.
One thing I know for a fact is that peoples lives and environment directly influence open rates and conversions.
If we’re mailing on a Saturday obviously people are not at work and depending on the person that could be a good or bad thing.
The lesson here is that you’ll have all types of people on your list and different times and days of the week will create opens and clicks from different segments of people on your list.
I’ve heard people argue against mailing every day, but I have tested this for 15 years and honestly never seen any other strategy generate more revenue.
So when I say mail consistently I mean mail every single day.
You’ll want to try different schedules and mix up the times you send so that you can find the most profitable time for each day of the week to send.
Here’s an example of how we usually start testing our list for optimal times to send emails on each day of the week:
Now what we do each day is chart our open rate (%) and our click through rate (%) so that we can compare the numbers weekly.
We will rotate these times for 7 straight weeks.
I know it sounds like a lot, but it gives you an idea of what your open rate, click rate and even conversion rate is on Mondays at essentially every single time shown above.
At the end of 7 weeks we simply find the time with the best open/click rate for each day of the week and we use that as our control.
Once we’ve established the time of day to send on each day of the week we will consistently send at that time for about 2 months and then we start our testing all over again.
Remember your list is constantly changing so it’s important to always be testing.
I realize this is very in depth, however, this is one of the keys to making your email list as profitable as it possibly can be when sending.
Step 4: Segmenting & Cleaning Your List
This could quite possibly be the most important step of the entire process if you want to maximize your profitability.
Segmenting your list simply means creating groups of people who all match the same criteria.
What we like to do is create a segment of the following types of people on our list:
90 Day Openers – These are people who’ve opened an email in the last 90 days
60 Day Openers – These are people who’ve opened an email in the last 60 days
30 Day Openers – These are people who’ve opened an email in the last 30 days
7 Day Openers – These are people who’ve opened an email in the last 7 days
We also like to create segments of our clickers, which are basically people who’ve clicked on an email in the given timeframe.
60 Day Clickers – These are people who’ve clicked on an email in the last 60 days
30 Day Clickers – These are people who’ve clicked on an email in the last 30 days
7 Day Clickers – These are people who’ve clicked an email in the last 7 days
So why do we need all these segments?
Email Service Providers like Google, Yahoo, AOL, Hotmail and others are always tracking your sending reputation. If you continuously send emails that get very low open rates you’ll likely see that rate continue to trend downward.
So how do we combat that?
We send emails to very active segments of our lists that we know are more likely to open, click and engage.
So here’s how a typical week might go for us:
You’ll notice on Sunday we send to our entire list, which allows us to add even more people to our segments for the following week because obviously some previously inactive people will open an email and end up on all your segments.
What do we do with those 7 day segments?
Usually we pick 2-3 days each month where we mail the 7 day openers and 7 day clicker segments because again we know it’s going to get super high engagement rates and boost our sending reputation.
This seems like a lot of work, but in reality it’s quite simple.
Most every auto-responder service will dynamically create these segments for you so all you’re doing is just choosing which one to send to each day.
There are people that will argue with this strategy, however, it’s one that’s proven to make us far more money and keep our delivery rates very high to our list .
This goes back to discussing quality over quantity.
If you have 1,000,000 people on your list, but your open rates are terrible what good is it really doing you?
You’ve got to have a quality list to make money and creating these segments allows you to maintain that quality.
Speaking of quality what about cleaning your list?
Cleaning simply means removing the inactive people on your list, which again boosts your engagement rates and sending reputation.
We usually remove anyone from our list if they have not opened or engaged with our emails in the past 120 days.
If someone doesn’t open any of the 120 emails you will have sent during that time period it’s not likely they are going to open the next one.
Leaving these types of people on your list will continue to hurt your open rates and sending reputation, which eventually hurts your ability to get emails to the people who actually do want them.
Hopefully this short article has helped point you in the right direction for building your email list the right way.
If you focus on building quality in your list from the onset you’ll find that the profitability through the entire process will be much higher.
The number one mistake people make is not focusing on the entire process when they first start building their list. After reading this article you should have a clear vision of what needs to be done at the beginning of the process (lead magnets) and what needs to be done towards the end of the process (segmenting) to create the most success.
The goal is for you to simply follow these 4 steps to create a profitable email list for your business.