Building The Business Case For Growing Your List

Many email marketers tell me that growing their list isn’t within their remit. Since they’re rewarded for sales and revenue and not for list-growing, they don’t pay any attention to this goal. But it always benefits you to grow your list — and here’s why.

Go for the easy win – it pays off

We spend huge amounts on driving traffic — but are we doing everything we can to capture permission to market to customers? Or are we letting them leave and then paying again for them to come back to the site? More often than not, we tend to go for the harder ask — to buy — rather than the easier win and smaller ask of gaining permission to market to them.

Create a business case

Most email marketers I teach/consult with have to fight for real estate on the homepage. I believe that it’s a fight worth taking up. To do so you, need to mine your data and make a business case for prioritising the position of the subscription point on your homepage.

To be successful at this you ideally need to speak to what matters to your business: How can growing your database help your business to achieve its objective of gaining more customers, sales and revenue?

An easy remedy or test could be to move your subscribe above the fold rather than below the fold, which, for one company, led to a recent jump in conversion rate.

Many argue against doing this under the mistaken belief that using this valuable real estate to gain subscribers instead of selling product will lose you revenue. The company found this hypothesis not to be true. Not only did they gain 30% more subscribers, but they also gained 27.31% more revenue. It’s a win/win.

Prioritise Email permission over Social Media

One of the common issues I see is that the very valuable real estate on your website, such as the top right hand corner, is given over to promoting social media channels, while the email signup is at the very bottom of the page.

A report recently released from Forrester states, “Email should be a focal point. …your emails get delivered more than 90% of the time, while your Facebook posts get delivered 2% of the time—and no one’s looking over your shoulder telling you what you can and can’t say in your emails. If you have to choose between adding a subscriber to your email list or gaining a new Facebook fan, go for email every time.”

How can we increase our revenue by growing our list?

Let’s look at a small online store that sells niche products. Currently they gain on average 554 new subscribers per month. Of those subscribers, an average 34% go on to make a purchase. Based on an average order value (AOV) of £15, we can start to forecast the incremental revenue that growing a list can deliver.

Assuming that they have a successful first-purchase programme in place to convert subscribers into customers, then not only is the online store potentially looking at gaining 400% more subscribers – increasing their monthly new prospect rate from being 554 to 2,770 – but they could also increase their revenue per month by 400%: from £2,825.40 to £14,127,00!

Also, it’s important to keep in mind these figures are just looking at the short-term impact – they’re not taking into consideration further purchases down the track by these customers, which can be enhanced by implementing a Welcome Customer/2^nd Purchase Programme.

The 400% potential increase mentioned above was an estimate because of the use of popovers, otherwise known as lightboxes — simple conversion technology that can plug directly into any website. The figure wasn’t pulled out of thin air. Some companies have experienced an uplift of over 300% in whitepaper downloads by implementing these popovers, and there are many retailers and publishers who have increased their subscribers by up to 400%.

One last thought

As  a result of data-mining, customers in the example above who bought fewer than 11 months ago currently make up 46% of the database, accounting for 60% of the revenue directly attributed to email.  So considering the value these newer customers contribute to the total earned revenue, the question is: What impact will growing your list, taking into consideration the natural engagement of new subscribers, have on your bottom line?

Originally posted on MediaPost

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