This is a guest post by Linda Claire Puig, my co-counselor for the Pink Spoon Telecamp:
WHY Grow Your List? (Count the Many Ways)
by Linda Claire Puig, president, Claire Communications
List-building tips are all over the Internet these days. You can learn for free (including my Momentum articles from June 30, 2008, and July 10, 2009), you can buy e-books on the topic or you can take high-priced courses.
But are you really clear on WHY it's important to continually focus on growing your list?
When you understand what's possible with a bigger list–not just a bigger list, but a bigger relevant list–you open to new potential…for your business, for your life.
It's easiest to explain with an example. Let's say you have a list of 200 people that you keep in touch with on a regular basis. (You are sending a newsletter, aren't you?) You decide to run a $350 group program and announce it to your list by sending a promotional email. Seven people sign up and earn you a total of $2,450.
In marketing circles, those seven new clients represent a very good "conversion rate" of 3.5%. Conversion rate is the ratio of people who purchase to the total number of people on your list.
Now let's say your list grows to 3,000 (still a relatively modest list size), and you offer the same $350 group program. If your 3.5% conversion rate remains the same, you will now sign up 105 new members for your group, for a total earnings of $36,750. You may have to run concurrent groups to accommodate all the new business, a nice problem to have!
But even if your conversion rate dropped to 2%, you'd still sign up 60 new members for your group, for a total of $21,000 in earnings.
So $2,450 vs. $21,000…FOR THE SAME AMOUNT OF PROMOTIONAL EFFORT!
Three important mentions here:
1) It's NOT all about a having a HUGE list. Smaller lists can be more responsive than their bigger counterparts. So decide on your income goals, determine your conversion rate history and let that help you determine how big you want to grow your list.
2) Don't forget that while you may attach numbers to your goals, building your list is ultimately NOT a numbers game. It's about building relationships with people who you would like the opportunity to serve. If you approach it this way, you will have a growing list that is always a relevant list.
3) Your list will not grow just because you wish it so. You may set a list-building goal for your year, but you won't meet it unless you take specific, focused action toward that goal. The very FIRST place to start is to have a great pink spoon…something that addresses a pressing need for your audience that you can give away in exchange for their contact information.
There are other reasons to grow your list that go way beyond numbers and dollars. Tell me, how do you help people? What are your gifts? With a larger list, your influence and your ability to help more people also grows.
Bottom line: No one is served by your list (or you!) remaining small.
To learn more about what makes a great pink spoon, how to use it to grow your list and generate more business — and to create your own pink spoon under the guidance of two marketing communications experts — please register for the Pink Spoon Telecamp.
Linda Claire Puig says
Hey, nice article! 😉
I’m no math geek, but the other day, I took the example I used in this article a little further, and it’s really cool!
So, referring to the example, if having a list of 3,000 instead of 200 increases the income from your promotion by $18,550 ($21,000 minus $2,450), then you could say that EACH NEW NAME (2,800) was worth $6.63! (That would be $18,550 divided by 2,800.) And this was using the more conservative conversion rate of 2%.
That’s a lot (!) and really reinforces the need to build your list if you want to increase your income. Having and using a pink spoon is really the first place to start! Vive le Pink Spoon Telecamp!
Linda Dessau says
Who knew that math could be so much fun!
Thanks Linda P.,