One of the first questions companies have when they start email marketing is where do they get the email marketing lists from.
Fundamentally there are two possible options to obtain email marketing lists
- Buy the lists
- Build your own lists
Both of these approaches has its own merit as well as its downsides so let’s take a look.
Buying your email marketing lists
The obvious main advantage of this method is it is quick. Find the list you want, buy it and then use it. You should not underestimate the time you will save. Having the ability to start an email campaign quickly could be exactly what you need to do and this is a sure fire way of being able to do that. Sadly all is not roses in the garden. Buying in an email list does have some downsides so let’s take a look at these.
Click through rate (CTR)
You are looking to engage with prospective customers who are actively looking for your goods and services. It is very difficult to achieve this with a list you have paid for. If you are looking to target builders in a specific area you can buy that list for about £100-£150 ($140-$200) per 1000 records. It does not mean they are actively looking for your product or service just that they are builders in your target area.
It is also worth pointing out that you are not buying the list outright. Normally the purchase will allow you to email the records on it a number of times or over a limited period. What you then need to do is email them and try to persuade them to opt-in to your list so that you can continue to email them. Sadly the number of people who will do this is not great. About 15% will open your email, 2% will click through to your sign up form on your website. So you can see of your 1000 possible customers only about 20 will ever get as far as your website let alone opt-in to your list.
Another downside is the quality of the data in the email marketing lists you buy. There are many companies who provide lists that do a superb job of ensuring all their data is cleaned regularly. What this means is that you can be sure that a high percentage of records you are receiving are good email addresses. You will never get 100% but you should expect at least 80% of them to be good. Sadly though there are also many out there with bad lists. They buy up old out of date lists or obtain the email addresses by scraping websites and directories. These lists are often much cheaper but are of little value. In fact, if you use them to grow your email list you stand a good chance of being blacklisted and damaging the reputation of your company.
If the price of the list seems to good to be true it probably should be avoided.
Building your own email marketing lists
Building your own list has a couple of major advantages over purchasing one. Firstly you can be confident that people on it want to hear about your products and services. That is because they have joined it via your website or social media accounts. A large number of them are almost certainly going to be your target market. They have also opted in to receive marketing emails from you. There is no difficulty in you sending them repeated email marketing campaigns.
Then, of course, we come to success rates. With our purchased list we expected an open rate of about 15% and a click-through rate (CTR) of around 2%. With our own lists, we would be expecting an open rate of around 35% and a CTR of about 10%. A much smaller list we have built should provide much greater returns. Finally, we have to consider cost. You have to put time into building your list so it can never be considered as free but certainly, it is a much cheaper option.
Now we come to the downside. Building your own list can never be described as a quick win. It takes time to organically grow your email marketing lists. Time that could be costing your company money. Even using the techniques I describe in another post “5 simple steps to grow your email list from scratch” building your list will be painstaking. You can, of course, turbocharge the process with a bit of carefully targetted Pay Per Click (PPC) advertising but that would be an added cost.
So, in summary, it is better to build your own targetted list than buy in somebody else’s list because your conversions will be much higher. However, if you do feel purchasing a list is a good idea for your company, and sometimes it is, only buy one from a reputable company.