If you are collecting emails for an email marketing strategy, then you might well have been attracted partly by just how affordable the process is, but what is your email list worth?
This is a marketing method with an extremely high ROI (return-on-investment), meaning that you barely have to spend anything in order to start really profiting.
But exactly how much is your email list worth? Can you really get “something for nothing” in this way? Let’s take a look!Selling a List
If you were to sell your list, or to sell it as part of an exit strategy along with your business, then you would often be expected to charge roughly $1 per subscriber.
This is a very rough average, but it is a fairly consistent and reliable method of valuing a list. That means that a list with 1,000 subscribers will usually fetch you around $1,000.
The True Value
Of course the actual value of your list is very different.
A list with highly engaged subscribers who read every single email is extremely valuable, compared to one with addresses scraped from the web!
That’s why most people will want to check things like “bounce rates” and “CTR” (click-through-rate) when they consider buying your list – it’s also why “list hygiene” is so important.
But what’s perhaps more important, is how much the list is worth to you at any given point.
To calculate this, you need to work out your CLV for each subscriber. This is your “customer lifetime value,” which means the amount that you will earn on average from a single person during the entire time you have their details.
Customer Lifetime Value
How might you calculate this? Well, take a look at your list as it currently stands, and then work out the following.
- people on your list have purchased from you?
- purchases do you get on average for every 100 subscribers?
- of those people purchased more than once?
Now ask what is the average profit that you get from each sale.
Get the total number based on all of your subscribers, and then divide this by the number of subscribers you have.
What you will be left with is a number that represents the average value of each subscriber.
Now, not everyone may buy from you, but based on average performance, this is what the average subscriber is “worth.” You’ll likely find it’s much higher than you thought!
There we have it. I hope this article helped you understand how to calculate “What is Your Email List Worth.”
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You may also want to check out an earlier post on How to Write a Great Subject Line for an Email
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