If you’re running a small business, you will enter into shady areas of the marketing sphere, sometimes, such as using purchased lists.
Whenever you’re marketing to a group of people who didn’t “opt-in” to your email list, the general feelings towards buying and using purchased list is often:
- Waste of time, energy, and money
Then why the heck people still purchase email lists?
The people who are selling them are in business, and there are people who keep on buying from them. Don’t you think there must be happening something behind the curtains?
The reason is that… purchased lists for email marketing actually does WORK.
You cannot deny this fact. It just does. But, of course, a lot of people have misconceptions about it, and as a result, suffer from serious consequences.
However, damages don’t always happen, as you’ll see in this post.
This post is a detailed example of an email marketing campaign that we ran last week, with a list of around 10,000 email addresses that one of our clients had purchased a month ago.
I agree it’s quite a small sample to base anything concrete, but if you consider the small size (1 or 2 men band) of service-oriented business, you’ll admit it’s a quite a large campaign indeed.
Possible risks of using purchased lists for email marketing:
Before I went ahead to set up his email campaign, I clearly explained to my client that there were many risks involved with purchased list email marketing.
Risks such as:
- Little or “zero” returns
- His domain name could be blacklisted forever…
- He could slander his reputation
That’s the 3 biggest risks for me.
So, what I did was create a smart plan of action that would reduce those risks or even prevent from happening in this campaign.
To minimize the damage, I followed these intelligent steps:
- Set up a new domain for the email (delivery and reply) address.
- Links back to client’s website was not included in the email copy
- I wrote a compelling email copy that had a warm introductory message and a purpose
- I also created a free report (e-Book) to send along with the first email… that would be useful to the recipient.
- I purchased a list from a highly reliable source, on that limits the presence of SPAM traps
With all these “safeguards” in place, I was confident to start the campaign.
Warning: I set up this test campaign for the UK audience, where it’s completely OKAY (or legal) to send emails to people… as long as you allow them to “opt-out,” if they wish from future communications. OTOH, sending unsolicited emails in some countries is not allowed at all.
The Performance of Purchased Lists vs. Opt-in Lists (Comparison)
Average performance of opt-in emails lists
Open Rate: 20.42%
Unsubscribe Rate: 0.23%
Click Rate: 2.75%
SPAM Rate: 0.3%
… and the
Average performance of purchased lists
The open rate of purchased lists was lousy. Here’s a screenshot that was taken from Smart Insights website:
The average open rate for a purchased list was really poor… between 1% and 2%.
This number is validated by the graphs shown below, too.
The Open Rate, Unsubscribe Rat, and SPAM Rate from Mailchimp
The above graph shows how the purchased lists for the majority of campaigns were total failures. The only thing that went up was compliant (SPAM) rate – everything else was going down.
The result of this particular email campaign?
It was terrible, as you can see from the above screenshot from Mailchimp.
However, I had a completely different experience with this particular campaign, though. Here’s what I noticed:
The open rate of this particular campaign was pretty good, which was about 5.02%.
My software doesn’t allow me to see the Unsubscribe and SPAM rates through the overview screen. I had to zoom into each section to see the numbers. Here are the
screenshots of the two segments:
And the unsubscribe rate is great, too. The average unsubscribe rate of this campaign was 0.62%.
Complaint (SPAM) rate
At first, we didn’t notice any of this, however, at the end, we ended up with a massive 2.05% SPAM rate.
The click rate was very very low, a little over 0.15%. We sent this email to 10,209 people in out list, which means 153 people clicked and saw our free report.
And this figure, as you’ll find later, means at least something.
What happened to the bounce rate?
I felt writing about this separately as this is where we got a massive hit. Look at the figures:
As you can clearly see, the campaign suffered a lot with a whopping bounce rate of 52.4%.
Average Bounce Rate of Opt-in List: 8.04%
Our Bounce Rate: The combined average bounce rate of all email campaign was 43.7%.
So… did a purchased list really worked in this case?
It may seem a little bit naive to say this, but in this case, the purchased list for email marketing actually DID work – without a shadow of a doubt.
Look, my client runs a small (2 man) business who offer a quality service to their clients. They don’t need many customers to rake in huge profits. In this particular campaign, we saw this amazing result:
- Out of 10,000 people, 460 people actually opened our emails – which is 5.02% open rate…
- … and 153 people saw our free report (at 0.015% click rate)
The best of all, the phone kept ringing many times.
That’s the most important thing for this campaign. The phone at the office kept ringing and we managed to generate enough leads to make sending an email campaign to a purchased list all worthwhile, at least in this case anyway.
So… should you run this type of campaign too?
This campaign worked only because my client was offering a high-quality service. However, if they’re after a high volume of clients, then, of course, this campaign would have been a HUGE flop. But, they only needed few leads, which was easily delivered at the end.
With that said, let me tell you one thing. If you’re thinking about running this type of campaign, would you still see a high ROIs if your open and click rate were as low as 5% and 0.0015%?
If you answered “Yes,” then, by all means, go ahead and try running this campaign. However, if the answer is a straight no, then don’t take the risk.