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What's the monetary value of 1 new email on your list?

by Hopeless Bromantic
3 replies
I've had some difficulty finding consistent information on this, so I'd like to get a sense of how the WF members approach this problem.

To keep things simple, let's suppose just for argument's sake that 10% of the traffic that visits your site gives you an email address. (Too high, probably, but I want to keep the numbers simple.)

Let's also suppose that, after getting your autoresponder mails, 10% of those people actually buy something from you. Let's also suppose that each of your customers buys an average of $100 worth of stuff.

Does that mean that the value of every new email address is $1? Or are there other variables that need to be looked at?

Thanks,
-Dave
#conversion #email #list #monetary
  • Profile picture of the author Shannon @ PayLoadz
    You have the right idea in that you want to calculate your individual member contribution to income.

    So if your list has 100 member and one member buys $100 worth of items, your average member value is $1. Though, your average customer value is $100. Both numbers are very important. Since you are asking directly, then adding one new email to your list will be worth $1 in theory.

    This really only works when you have scale and can spread the values over a large amount of time and transactions. Be careful when taking this too far in thinking that each new member is worth $1 as it often leads to people devaluing their list with lower quality members with people who won't buy and therefore drive that $1 value lower.
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    • Profile picture of the author Hopeless Bromantic
      Originally Posted by Shannon @ PayLoadz View Post

      You have the right idea in that you want to calculate your individual member contribution to income.

      So if your list has 100 member and one member buys $100 worth of items, your average member value is $1. Though, your average customer value is $100. Both numbers are very important. Since you are asking directly, then adding one new email to your list will be worth $1 in theory.

      This really only works when you have scale and can spread the values over a large amount of time and transactions. Be careful when taking this too far in thinking that each new member is worth $1 as it often leads to people devaluing their list with lower quality members with people who won't buy and therefore drive that $1 value lower.
      Excellent points, Shannon. Thanks.

      I'm not sure what you mean when you refer to lower quality members, though. It seems to me that there's no way to avoid attracting several "low quality" members for each "high quality" one who signs up.
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      • Profile picture of the author Paul Hooper-Kelly
        Hi Dave,

        It's generally reckoned that one name on your list is worth - on average - one dollar per month. So that means - if you have a list of 1,000 names on January 1 - by the end of the year it should have made you (1,000 X $1 X 12) = £12,000.

        But that is only a ball park figure and assumes you don't hammer your subscribers into the ground with promo after promo. Instead, you must nourish the relationship you have with your list by sending plenty of good information most of the time - with only the occasional promo.

        But, because you're doing it right, the response you get from an occasional good promotion will outweigh the bits and pieces you get from doing endless trashy preomotions.

        Best bit: doing it this way means you're likely to end the year with those 12,000 subscribers still on your list.

        And - of course - you won't stop at just 12,000. So by the start of the second year, you may have 24,000 subscribers. I know guys with 250,000 active subscribers. Imagine the sort of paydays they get when they send out a promo!

        Warmest regards,

        Paul
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        If you want to stack the copywriting deck in your favor with tricks and hacks producing winners like: "$20K in three days" "650 sold" "30% conversion", then you might like to know I'm retiring and will spill the beans to two people. More info here.
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