The internet is over flowing with “How to grow your email list” articles.
Nothing wrong with that, I strongly believe that if you’re trying to build an audience around your business, it should be on email, and you should try to grow it as much as you can.
But, focusing on growth and growing blindly are not the same thing.
This is why I like having an ideal number in mind when it comes to growing your email list.
In this post, I’ll show you how to figure out how many subscribers you need to have in your email list with a simple formula and why email marketing is not about hitting a number.
How Many Subscribers Do You Really Need in Your Email List?
Back in the day, when I owned a Directv authorized distributor (did I ever tell you I used to sell Directv?), my goal was to make the phone ring 600 times per day. I had a sales goal of 100/day and I knew that if I generated that number of calls, the goal was going to be achieved.
Of course, there was a mix of different types of calls coming in, like customer service, reschedules, tech support and other stuff, but 1 out of 6 calls was a sure sale.
Or, as the kids like to call it today, a 16.67% conversion rate. 😉
My formula was simple: 600 Calls = 100 Sales = Francisco happy.
Today, I use the same formula to calculate how many subscribers I need on my list.
1) Establish a goal
Establish a clear goal of how many sales you want to achieve. Believe me, life will be better once you have that magic number in front of you.
Let’s say you want to make: 100 Sales.
Your goal can also be in revenue. If your product sells for $100 and you want to make 100 sales, your goal in revenue is: $10,000
2) Get your past data
Look at the performance of your past campaigns.
Let’s say that back in March you were able to make 50 sales in a campaign, what you need to look for is how many subscribers you had in your list at that point.
We’ll pretend you had 2,000 subscribers. That means that 2.5% of subscribers purchased your product.
Here is the formula: Sales / Subscribers x 100 (50 / 2,000 x 100 = 2.5)
Just to make sure we’re on the same page here, we’re not exactly measuring “conversion rate” here. Conversion rate is measure based on the clicks on a campaign, like this: Sales / Clicks on a campaign x 100
3) Subscribers needed
You know where I’m going with this, right? If your current data indicates that you convert 2.5% to sales, and your goal is to make 100 sales…
You need 4,000 subscribers in your list.
In this formula, we’re not considering opens and clicks, and of course the fact that you could improve your conversion rate, but here’s the thing…
Nothing in marketing is permanent or static, your audience moves, a campaign can get more opens, fewer clicks, a guest post can convert 40% to subscribers, a content upgrade can fail miserably. This number is only intended to provide a goal, that’s why we’re looking at previous data.
Okay, so what happens when I hit my goal, Francisco?
Should you stop trying to acquire new subscribers once you hit your magic number?
Of course not. Email marketing doesn’t work like that, let me explain why…
Why you always need *NEW* email subscribers
When I say “new subscribers,” I’m not necessarily talking about growth, but the opportunity to have fresh subscribers in your list at all times.
“The Honeymoon Period”
Many people have asked me when is the best time to make an offer, some jump the gun by making an offer right away and others build a list for a year without offering anything.
The perfect moment to make an offer is during the honeymoon period.
The honeymoon period usually happens when you have added just enough value, the subscriber is excited to open and click your email campaigns, but before engagement starts to slowly decrease.
Think of it as dating, you enter the romantic phase, interest peaks, you’ll have to make a move eventually, before you’re moved into the “friend zone.”
Now, this doesn’t mean you won’t be able to make sale after. You’ll be able to keep some people engaged for longer periods of time and even get repeated business, if they’re happy and you have a good retention strategy.
But some will inevitably fade out as engagement decreases over time. It’s impossible to keep everybody engaged all the time.
If you stop getting new subscribers today, you’d probably start seeing a slow decline in open and click rates.
New subscribers = Higher Opens + Higher CTR = More Sales.
And that is why you should always maintain a flow of new subscribers coming into your list. So you can more chances to the honeymoon period.
At the other end of the spectrum, you probably have a number of subscribers that are no longer engaged. These folks should be removed from your list at some point.
I’m not talking about the people that unsubscribe from your list, but the ones that are no longer engaging with your campaigns even though they’re still on the list.
But dumping deadbeat subscribers is a whole different blog post.
Oh wait! I wrote that post, you can read it here.
As you can see, some people are coming in, others are going out. This, my friend, keeps your list fresh and with much higher chances to close sales over and over again.
Just make sure your acquisition is always higher than your churn.
So, let’s recap real quick…
- Growth is good. Blind growth, not so much
- You want an email list because you want to make sales
- Establish a sales goal
- Look at your past data to see what percentage of your subscribers purchased a product from you
- Calculate how many subscribers you need in order to reach your sales goals
- Your list should always be alive, with fresh subscribers always coming in and deadbeats going out
You good? Alright, looks like you have a little bit of homework. Grab a coffee and aim to end up with a magic number in front of you.
Questions? That’s why I’m here. 😉