People often have many ways to obtain or grow email lists for their future marketing campaigns, but certain methods may be more effective than others. When people consider buying a list from a third-party provider, they must also consider the costs, pitfalls, and other potential options before making a commitment.
How much does an email list cost, and should people buy one?
A third-party email list typically comprises a collection of email addresses and other associated details, such as names or phone numbers. Many brokers and data companies compile these lists and sell them to businesses as part of their direct marketing efforts.
The cost of an email marketing list will depend on several factors, including not only the quality of the list in terms of its targeting and maintenance, but also the type and source. Many email lists are based on costs per thousand impressions, which is also commonly referred to as cost per mille (CPM).
A CPM is the cost for 1,000 email addresses. Most lists cost between $100 and $600 CPM, but consumer lists can cost between $100 and $400 per CPM, business lists can cost $600 to more than $1000 per CPM, and all list prices can vary depending on the content of the list, meaning lists that are more targeted will be more expensive.
The general rule is that business lists are more expensive than consumer lists, as businesses are also the most likely to spend a significant amount of money based on the lists.
Will purchasing an email list help you acquire new customers?
For many companies across the United States, purchasing an email list can be an appealing option for multiple reasons. Litmus Research shows email drives a return on your investment (ROI) of $36 for every dollar spent.
Many businesses will prefer to consider the potential uses of an email list and believe it outweighs the amount spent. Email lists can provide companies with the names and contact information for potentially thousands of new customers.
Unfortunately, one drawback to email lists is that having one’s information included does not necessarily indicate willingness to express interest in any company information. All of this is not to mention other possible issues that can arise with email addresses, such as certain addresses being invalid or emails bouncing back, increasing a bounce rate, and damaging sender reputations with email service providers (ESPs).
Businesses must focus on developing their own email lists organically over time. This will mean tracking all communications and noting which customers correspond with the company.
Dangers of buying third-party email lists
While many companies offering to provide email lists will mention the numerous possible benefits, they rarely mention any of the drawbacks. People need to be aware that there can be several consequences in some cases.
No guarantee of a return
Regardless of the cost of a broker-supplied email list, it is unlikely to comprise your ideal customers. This means that even when you seek a highly targeted list of contacts, the individuals named on the list have not shown any interest in the company or its products or services, nor have they consented to receive marketing emails.
Companies must be aware that contacting these individuals could be a violation of the General Data Protection Regulation (GDPR), which may result in fines. Any non-consenting contact will typically be a lower-quality lead, as they are less likely to convert compared to those who have consented to such communications.
The simple truth is that a company could spend thousands of dollars on email lists only to see few to no conversions. The bottom line is that the amount you spend is not indicative of any kind of success.
Damage to your sender’s reputation and future campaign abilities
The major problem with sending emails to people who have not consented to receive them is the risk of the emails being marked as spam. Many people do this frequently with business contacts.
The problem with having your emails marked as spam is that when this happens too often, your spam rate will increase, and you will gain a reputation with ESPs for sending unwanted business emails. ESPs may then automatically divert all of your messages, even those with consent, to a user’s junk folder and very much limit your long-term reach.
Damaging to your brand
Multiple studies have shown that companies sending non-personalized content without a user’s consent can create a negative experience for a brand and may be against the law in several countries. The result will be people not only unsubscribe from emails but also take their business elsewhere.
A survey of American consumers by Manifest found that nearly a quarter said they unsubscribe from emails they did not sign up to receive, opting out at a rate of 38% when the content is irrelevant. Coveo also found that 76 percent of consumers would completely abandon a brand after three or fewer bad experiences, while a little over one-in-10 said they’d move on at the first instance.
Possible fines for violating email compliance laws
When a business emails multiple people without their permission, it is at risk of violating several American and European laws, which can result in serious fines. The CAN-SPAM Act sets the rules for commercial email, establishes requirements for commercial messages, gives recipients the right to opt out of receiving emails, and outlines penalties for violations.
When a business uses a third-party email list to contact a person who previously opted out of receiving email marketing, it can be a CAN-SPAM violation that may result in a fine of up to $46,517 per email. GDPR applies in the European Union and the United Kingdom and requires brands to obtain freely given, specific, informed, and unambiguous consent.
Building an email list organically for greater engagement
Businesses are far more likely to achieve engagement and conversions by contacting 100 highly targeted, consenting recipients than by sending blast emails to half a million people from a generic third-party email list. This is because when businesses know who they are talking to, they are also more likely to provide relevant and engaging content.
Some of the ways you can ensure you are reaching the right people with an email marketing strategy will include:
- Consider renting a third-party email list
Purchasing an email list typically enables a party to reach a large number of people. Renting an email list can allow individuals to reap the same benefits while minimizing financial risks.
Renting an email list can involve paying a third party to use their email list for a single blast or campaign, as determined by an agreement. In these situations, the recipients of emails will have opted into receiving messages from a providing brand’s partners, but their details are not shared as the provider will send the company’s content on their behalf.
Renting an email list will require finding a third party that has a similar audience to your own. This means that Software as a Service (SaaS) providers can pay to send email blasts to a company’s list of contacts whose products integrate with theirs.
The focus on short-term results can make email list rental a good option for flash promotions, new product launches, entering new markets, and targeting niche audiences.
- Know your lead magnets
When a company is dealing with a new subscriber, it must demonstrate that the user will derive some benefit from reading their emails. In many cases, companies must demonstrate that they can make a positive impact on a person’s life immediately.
A lead magnet is a marketing term for free items or services offered for the sole purpose of gathering contact details. Trial subscriptions, white papers, e-newsletters, and free consultations are common examples of lead magnets.
Strong lead magnets, accompanied by effective teasers and calls to action (CTAs), can effectively compel website visitors and social media followers to provide their contact information. They could be pieces of high-value content, such as reports, e-books, or “how-to” guides. Additionally, they could include promotional emails offering discounts on first orders, product trials or demonstrations, and event invitations.
Whatever type of asset a company deems most suitable for its audience, it must ensure the assets are relevant and valuable to their potential subscribers, exclusive in that people cannot obtain the same benefits elsewhere without providing personal information, and immediately useful to users.
- Embed sign-up links in social media profiles
Most businesses have social media profiles, and companies should ensure that their social media profiles also include sign-up forms, buttons, or links to facilitate user registration. Such efforts always make it easier for people to subscribe to newsletters or register with companies.
Consider CallHippo, which uses a sign-up link on its Facebook page to offer people a free trial of its cloud telephone service. In many cases, a shortened URL from a service like bit.ly can help companies avoid being distracted from their CTAs.
- Capture data with QR codes
QR codes are machine-readable barcodes that, when scanned with compatible devices (usually smartphones), will redirect users to online content. Companies publish QR codes in places where their target audience can see them to provide a fast and convenient way for people to learn more about the brand and explore what it offers before signing up for mailing lists.
Companies using QR codes to build email lists will want to ensure that users are directed to mobile-friendly sign-up landing pages where they can learn more about the company and enter their details. They should also use clear CTAs with QR codes that allow people to scan and learn more, and utilize QR code generators to create dynamic QR codes.
Keeping an email list healthy for effective marketing campaigns
It is challenging to quantify the importance of an email list to a business. While the value often depends more on quality than quantity, the truth is that even the most thoughtfully compiled email lists can still deteriorate over time as people begin to opt out, change their email addresses, or develop new needs.
This often means that businesses will experience low open rates, low click-through rates, high unsubscribe rates, and high bounce rates. Companies can practice good email hygiene and list management by using targeted messaging and CTAs to get the right kinds of subscribers and segmenting their lists using factors such as demographic and buyer journey stages, so they can personalize their message content, setting followers’ expectations early to minimize unsubscribes and spam complaints, and cleaning email lists regularly by either re-engaging or removing inactive users.
There is no denying that the immediacy of a third-party email list can be an appealing offer for many companies, but the same businesses need to ask themselves if paying for an email list will really be a better option than building their own list. Investing the time to build high-quality email lists of targeted, consenting recipients will set businesses up to benefit from a more powerful and cost-effective digital marketing channel.
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