the real success principles of email marketing
TRANSCRIPT
The 6 REAL Success Principles Of Email Marketing
By David Eisner
Copyright David Eisner and PAXMAN LLC
Please do not duplicate or distribute without permission.
It’s well known that Email Marketing is one of the most, if not THE most powerful marketing method available for businesses. If nothing else, the ROI available and the inherent ease of implementation is enough to justify every single business on the planet using it.
But what I think is not well known, are the actual elements of it that a business owner should be focusing on if he or she wants to make more and more money with it, long-‐term.
The reason why the “real” leverage points are not clear to the masses is because there is so much damn noise out there! And the noise is out there for a specific purpose – to sell you something new.
Listen, regardless of me saying this fact, I’m not here to rampage about anybody else selling anything. Some of this new stuff is good and can help. AND I’ll be the first one to admit that I’m not the best business owner or email marketer on the planet – not even close.
Have I made a lot of money from email? Yes. In fact, the vast majority of my over a million dollars in online sales has been from sending out emails. But I’ve made my fair share of mistakes as well.
And in a sense, that’s where I’m able to derive a lot of this information that I’m about to share with you. Because if you’re smart, every time your business plateaus or declines, you’ll track WHY. And over the past 5 years, I’ve watched what I’ve been doing and a lot has become clear to me about why certain things are working or failing. Basically, with the ups and downs, I’ve seen some clear patterns.
Additionally, I am a researcher; I study what other people are doing. When someone makes a $10,000+ payday, I try to find out why. When somebody is consistently at the top of leaderboards, I get on their list. I observe and absorb.
And you want to know something really funny? Not a single person or company does email marketing exactly the same. They ALL have their own flair and different ways of doing things. Yet, they all make a great ROI on it.
That should be the first indication of what’s going on here...
See, those people I was talking about, the ones who say “this and that” is the actual lever of success – they’ll put an emphasis on email copywriting, newsletter style and format, how many links to place in an email, etc.
But that’s not even close to the extent of it.
The list of what I like to consider, “marginal gain mechanisms”, if they even provide gains at all, is longer than the list of marketing methods Ryan Deiss has pronounced dead.
I make jokes.
But seriously… Ryan is obviously one of the greatest internet marketers ever. Shear genius what this guy comes up with and puts out. Actually, one his products was “13 Sneaky Little Email Marketing Tricks”.
And if you look at the majority of those 13 tricks, they all provide those “marginal gain mechanisms” I’m talking about.
Guess what? That product sold a lot of copies.
That’s because those mechanisms are sexy. They sell.
And sure, when you combine them all, can you get a great gain? Sure.
There are hundreds of intricacies within Email Marketing… and if you were to find all the perfect levers and pull them, you can improve your results.
But none of them are really worth focusing on compared to the most important ones… the ones that if Ryan made a product about them, would probably never sell.
It’s much easier to sell these:
How to get your emails opened, how to improve your deliverability, what font and size to write your emails in, what auto responder to use, how to get less spam complaints by controlling the “complaint link”, how to co-‐reg leads so you get paid to build your list, how to build 3 or 4 different kinds of lists simultaneously… and the list goes on!
Any of those sound interesting? Well, I’ve sold products on many of them or included information about almost all of them inside of my email marketing trainings.
But those are all DETAILS!
That’s NOT where your focus should be if you really want to make the most money in your business. Man have I learned this the hard way. There’s a lot of wasted time in a lot of those subjects, especially if you’re a one-‐man crew, which I was for many years.
So the question is… what ARE the real success multipliers of email marketing?
It ALL has to do with the quality and number of your leads (email addresses) that you have permission to send to.
I was reading “The Boron Letters” by Gary and Bond Halbert sometime earlier this year and what I had intuitively known for years about email started to ring some major bells in my head.
See, Gary was a direct response genius, right? But for most of his career he didn’t even deal with email, he dealt with direct mail (snail mail).
And if you want to learn about how to be successful with email, the best people to learn from all the direct mail people.
Why? Because they spend massive amounts of money to mail advertising pieces to mailing lists.
That means in order to get a good return without losing their hats, they need to be 100x better than we need to be with email.
Email is far more accessible to the average business owner and marketer because it’s so cheap and easy to use, and has a very low risk level. Sending 1000 emails costs mere cents, while sending 1000 postcards costs HUNDREDS of dollars!
However, the concept is exactly the same, and this is what you must understand.
All you’re doing with email is finding a way to get back in touch with a “list” of prospects or customers, right? Direct mail is exactly the same in that regard.
In direct mail, if you don’t own a list, you have to “rent” one. That’s the equivalent of a “solo ad” in email terminology, right?
It’s obviously cheaper and more powerful in both marketing methods to eventually build your own list, because then you don’t have to pay for the privilege of getting eyeballs on your offers, right?
So now that you see the parallels… let’s talk about what Gary had to say…
In the book, Gary talks about the quality of different mailing lists and which ones got the best response. I mean, to mail 1000 people from list ABC costs exactly the same as list XYZ… so it makes the most sense to mail the list that’s going to get the best response.
In building your email list, you want to abide by the same principles.
Success Principle #1: “Recent”
If you’ve ever done a product launch and then emailed that list directly after the launch… and then again a week or month later… there’s a pretty significant drop-‐off in response, isn’t there?
That’s just a week or month later! It’s kind of crazy.
The fact is, the more recent somebody has shown interest in a topic, the more “responsive” they’re going to be towards your future messages.
That obviously doesn’t mean that if you don’t sell them something in the first couple of weeks, that they will never buy something.
We’re just talking about the “responsiveness” or “power” of your list as a whole, on average.
Because since emailing people or even storing their addresses is so cheap, it doesn’t make much sense NOT to send them email years down the line.
In direct mail, that would be a risky proposition because you have to pay big money, comparatively to send postcards or letters.
But here’s what I want you to take away…
Never ever stop adding fresh prospects and customers to your list.
You must do it consistently, if you want to keep your opens, clicks, and sales consistent.
Sure, if you build your list this year, you can still make significant sales from that very list years down the line…
But it WILL fade. I am tempted to go as far as to say, “it is law” because I would be shocked to find a business owner out there whose email list is just as spry as the day they built it.
That’s because people change interests. They unsubscribe. They get distracted. It all happens. And obviously there are also technical reasons like hitting spam boxes that decrease response.
Here, let’s crunch some numbers to see how important this is. This is what I believe looks like a likely scenario in email marketing today:
Let’s say for every new 1,000 subscribers you can generate…
300 clicks on the first email
200 clicks on the second email
150 clicks on the third email
And it goes down 5 clicks for every email after that and levels out at 30 clicks (3% CTR) after 3-‐6 months and 20 clicks (2% CTR) after 6-‐12 months.
(Some people will do better or worse than this based on many factors – it’s just an estimate for illustration.)
In this example, after 27 emails, you’ll be generating 30 clicks per email from 1,000 subscribers.
Even if you applied the best email hack in the world and quadrupled your response off of that, you would still only get to 120 clicks after the 27th email.
On the other hand, if you just got 1,000 new subscribers, you would instantly add 300 clicks.
Basically what I’m saying is… people will sell all kinds of “list resurrection” techniques, but to this day, nobody has shown me definitive evidence that they can get anywhere close to the results of adding fresh subscribers who are showing TODAY that they have an interest in what you have to offer.
Success Principle #2: “Buyers”
This is yet another type of list that Gary Halbert said he would rent – people who are proven “buyers” of a product in the niche.
Why? Because some people have enough desire and means to lay down some dough and some don’t. It’s often as simple as that. And selling to those that do, well, that just makes your job about 10x easier.
I say 10x because that’s about what you should expect is the relative response difference from non-‐buyers to buyers.
Meaning, if my average lifetime subscriber value (ALSV from here forward) of a non-‐buyer is $1, then I should expect my ALSV of a buyer to be $10.
More than that, once you’ve gotten someone to trust you once and buy your stuff, they’re definitely more likely to repeat the process. That means immediately and long-‐term.
If they’ve only opted in, the chances that they’ve even consumed the product that they got for free is significantly lower than if they would have bought it. And if they actually consume the product, that bodes well for you because they’ll trust you more and be more likely to buy from you again (as long your products are good!).
Let’s just say that my 10x theory is true. This is what the math might look at when choosing how to structure your funnel…
So let’s say you’re building your list…
And your current funnel looks like this:
Free Report (30% conversions) -‐-‐> $47 buyer (5% Conversions)
On 1,000 Clicks you would receive:
ALSV of 300 Opt-‐ins (minus 15 sales): $285
15 Sales: $705
ALSV of 15 buyers: $150
Total: $1140
But let’s say you just restructure the funnel a little bit and sell the initial product for $1 in order to get more people buying instead of opting in…
Note: Your initial offer conversion rate drops but your immediate upsell conversion rate increases.
So your funnel looks like this instead:
$1 Report (10%) -‐-‐> $47 buyer (10%)
On 1,000 Clicks you would receive:
100 sales @ $1: $100
ALSV of 100 Buyers: $1,000
10 sales @ $47: $470
Total: $1570
In this rudimentary example, the increase is 37% over the lifetime of the leads. Obviously these conversions would have to hold true to support the theory, but the theory can be tested in this way across any funnel to see if the gains could potentially be greater by restructuring the funnel to attract more people to buy.
One of the clear tradeoffs in this example is less money immediately in exchange for greater lifetime lead values -‐ and that is a decision you’ll have to make when structuring the pricing of your offers.
One more thing that is worth mentioning is the cost of storing or emailing leads. Over time, it does add up.
For example, the cost of storing 10,000 leads in the average auto-‐responder is about $80/month. For 100,000 leads, it’s about $550/month, or an extra cost of $5,640/year. If everything else is equal and the ALSV is truly a 10:1 response difference, storing buyer leads is far more cost-‐effective as well.
Success Principle #3: “Expensive Buyers”
This is a similar principle to the Buyers principle and has to do with the same concept – qualification.
If someone has proven that they’ve bought an $1,000 product before, then logic holds that they are physically able and of the mental mindset to possibly spend that money again.
Whereas someone who has only bought a $7 product from you has not proven that.
Does that mean that a buyer of a $7 product WON’T buy an $1,000 product? Absolutely not. All it means is that they have not proven to you that they will do so.
I know someone who has 13,000 buyers on his list, most of whom have spent $5,000 on a course with him. He’s made over $6,000,000 promoting other offers to that very list.
That’s a ALSV of $461.
Granted, this guy is amazing at building a community and is frequently giving his customers tons of value for the $5,000 they spend with him – that is necessary.
But as far as email marketing is concerned, what’s the moral of the story?
ALSV is directly correlated to the amount your buyer lead is qualified at.
In English: If you sell more expensive stuff, you’ll more easily be able to sell more expensive stuff to your leads later on.
Success Principle #4: “Relationship”
This is one of those impossible-‐to-‐quantify metrics that people often talk about when referring to email marketing success. But regardless of its “un-‐quantifiableness”, it’s definitely a factor of response.
The person in the spotlight who I’ve seen talk about this the most is Frank Kern. He’s quoted as saying, “The money is not in the list, it’s in the relationship with the list.”
Beyond that, he would also say that the response that you get is often based on how much “good will” you have banked up.
So every time you send out something awesome to your list that they love you for, you bank some good will.
Then, theoretically, when you promote something to them or try to convince them to buy something, you “tap into” that bank of good will.
This is presumably why Frank, for many years, was able to waltz into any affiliate contest and take home 6-‐figure paydays or more with a single email.
Sure it’s easy to pass off Frank’s massive success to how damn suave he is, his timing into the market, or how huge his list is… but you have to admit, he has a point. And especially in the last couple of years, he’s truly been walking the walk, so to speak.
SIDEBAR: I’ve been on his list for YEARS – my entire internet marketing career… he was one of the first people to teach me about email marketing. And this should say many things to you, about many points in this article (not just this particular section)…
I often open and read Franks emails. But it took me about 4 years to actually buy something from him.
Why?
Good relationship, learned a lot from him… but he never qualified me as an expensive buyer – and his products are generally very expensive.
Success Principle #5: “Relevant and Complimentary”
This one may seem obvious to some people… but it really wasn’t obvious to me for the first couple of years I was in this business.
When I started, I would mail my list every offer under the sun. I sold products on email marketing and solo ads… yet I would turn around and sell the latest “offline/local marketing” moneymaking scheme, even though I never had ANY interest in selling internet marketing services to local companies.
Totally unrelated, and in no way complimentary to why my list was listening to me in the first place.
Why did I do it? Well, for the most part, I didn’t know better. I was new to business in general. I just promoted what looked good and I thought people would buy. It made me money because there was 1/100th of the competition that there is today.
In truth, I’m still guilty of it in smaller ways, because it still makes me money. But at least these days I discriminate much more and stay within a general border. I’ve maybe promoted 1 “offline” offer in 2 years because I realize just how off base it is with my constituency.
The only reason I was able to get away with it in the first place is because if you sell a “Make Money Online” product to someone and put them on your list… there’s a good chance you can sell them another business opportunity right after that.
There’s a reasonable amount of relevance to that person’s mindset and that’s why it works.
But not only is that not a good way to do business long-‐term, nor does it generally help the person who’s buying the stuff, it’s also a good way to lose loyalty, good will, and eyeballs on your emails (by crowding that person’s space even more).
Keeping your offers relevant to what the subscriber has shown interest in is one of the biggest differentiators in response.
You can see it on the leaderboards all the time…
One week “list owner X” who has sold a keyword research software will crush a huge SEO launch and make 5-‐figures… but then the next week will promote a copywriting launch and make 5 sales.
That’s because people who are interested in SEO are rarely interested in creating great sales copy.
It might be somewhat related, because both topics are in the marketing niche, which his why he was able to make 5 sales… but the level of response is based on how well it complements what the majority of the people on the list are attempting to accomplish.
If he tried to promote dog training to his SEO list, he’ll probably make no sales, right? It’s not relevant at all.
If he tried to promote a Wordpress theme that proved to rank sites better, he’d probably hit the leaderboard again. It’s relevant and complimentary to his keyword research software.
Success Principle #6: “Bigger”
Don’t let anybody fool you; when it comes to list size, bigger is better.
That is IF you’re following the first 5 success principles.
Because every time you hear someone say, “I’ve seen people with a 10,000 person lists trump guys with 500,000 person lists all the time…”
YOU WILL KNOW the difference between those two lists and why the smaller list trumps the larger one… and it lies in the 5 previous principles.
One of the things that always attracted me to email marketing is that it’s just about the easiest marketing method in the world to scale. There is absolutely NO DOWNSIDE to building your list bigger. The sky is the limit!
If you’re following the first 5 principles, building your list bigger will only proportionately increase your results and make you a ton of money.
Conclusion:
Your perfect email marketing strategy in a few sentences:
Focus on collecting the email addresses of lots of recent buyers of expensive products of yours, who respect your opinions and are excited for your emails. Mail them relevant and complimentary content and offers that increase their results and your level of good will with them. Then scale your list-‐building efforts as much as possible.
The other stuff is just marginal gains… just details.
Thanks for reading!
Author: David Eisner, AKA the Backpack Businessman – go to http://backpackbusinessman.com for more articles, training, and resources.