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. This is a marketing method with an extremely high ROI, 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. For instance, a list filled with highly engaged subscribers who read every single email will be extremely valuable compared to one filled with addresses scraped from the web!
That’s why most people will want to check things like bounce rates and CTR when they consider buying your list – it’s also why list hygiene is so important.
But what’s perhaps even 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.
How might you calculate this? Well, take a look at your list as it currently stands, and then work out how many people on that list have purchased from you. How many purchases do you get on average for every 100 subscribers? How many of those people purchase more than once?
Now ask what the average profit you get from each sale is. 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 will be likely to 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!