By now if you read this blog with any regularity, you are by no doubt familiar with who Shoemoney is. If not, you should Google him and read his blog.. it is a pretty interesting story. Recently Shoemoney has been in the process of relaunching the “Shoemoney System” that details ways that Joe Sixpack can take a swing at making money online with the odds in his favor as much as humanly possibly given the average lack of background and experience..
The Good Stuff
What I was amazingly interested in however, was the contrast between the conversions of clicks to leads that stem from a very warm (and large) e-mail distribution list that has a) heard of Shoemoney before and b) has been communicated to by the list owner. Luckily enough, non other than Mr. Jonathan Volk of JonathanVolk.com decided to openly use a Bit.ly link with his e-mail push which meant we were able to peak into the results.
Bit.ly is a great way (mostly because of accessibility and free cost structure) to track the number of times your link is clicked, when that is, where its from (application) and what country. However, when doing a very public e-mail push, you are going to get called out on it from time to time.
So first things first, how did Jonathan Volk build up this e-mail list.. and how big exactly is that list? Jonathan Volk, Jeremy “Shoemoney” Schoemaker, Frank Kern, Andy Jenkins and a laundry list of others all operate in the affiliate marketing space to a certain degree. Because of that, they have a large audience that overlaps with each other and at the very least has a very similar set of actual needs. When Jonathan Volk wrote an eBook about effectively advertising with Facebook and other affiliate marketing promotional methods, he was able to leverage his existing relationship with people such as John Chow, Shoemoney to pump his eBook to a ready, willing and eager audience while providing value in exchange for a nifty e-mail address.
Jonathan decided to chime in on my Twitter conversation with John Chow to make sure it was stated that he pulled off this e-mail list for JUST the cost of 3 iPads as Chow has stated…
But there were certainly more promotional methods than just this for Volk, but tapping into lists such as Shoemoney, Kern, Chow and Jenkins was a good way to capture the low hanging fruit. I know for a fact that he also used some Sponsored Tweets to promote his book to the affiliate marketing space. (side note: I plan on covering Sponsored Tweets pretty in-depth very soon).
The 150x ROI
The rule of thumb in the list building business is that a targeted e-mail list provides about $10 of profit per year for each subscriber depending on how effectively they are marketed to. So to figure out the total value return of this list for Volk, lets do some simple math that rounds up on the cost of promotion and down on the number of subscribers.
Subscriber Value: $10
Average Subscriber Validity: 3 years
Lifetime Value of Subscriber: $300,000
Cost of acquisition: (3 ipads at $500 ea. ) = $1,500 + (sponsored tweets0 = ~$500 : $2,000
With these quick and dirty numbers, Volk can expect to get up to a 150x return on his $2,000. Not a bad return at all if I may say so myself!! So what about this particular launch that we have click and conversion numbers from?
Warm & Communicative vs. Cold & Direct
Volks list produced 1,629 clicks over a roughly 1 week period and two mailings out of list that is known to be at least 10k.
Click through ratio? (clicks/emails) = 16.29% or lower for an “active” list
Number of leads generated? 824.
Conversion Ratio? (leads/clicks) = 50.58% HOLY SHIT THIS IS GOOD
Cost per conversion (cost per lead/conversions) = $2.43 per lead, but has a much longer lifetime value
What were my results with my leads generated through advertisements?
I generated 588 clicks over roughly the same period of time as Volk, relying primarily on SponsoredTweets for Traffic with a total cost of $25.86
Click through ratio? This is hard to tell because I just used Bit.ly and we don’t know view/click data
Number of leads generated? 23
Conversion Ratio? (leads/clicks) = 3.9% MASSIVE DIFFERENCE
Cost per conversion (cost per lead/conversions) = $1.12
What is amazing about the difference in lists compared advertising for lead generation is the conversion of leads into your relevant product, service or affiliate offer. If you have a list that you have build of good will with in the community you are going to see a MASSIVELY better response rate from your audience and a much larger return.
In regards to me having a much lower cost per conversion for this particular push, it is important to note that while Volks cost if confined to this case study alone would be more than double what I paid, he will have the opportunity to repeatedly market to this audience for a return that is many, many times larger than what I may generate through this study.
Building a List
How can you build a list and start cashing in the huge return that people like Volk are reaping the benefits of? Here is a check list of things to remember when pursuing this opportunity.
1. You absolutely MUST provide value to your market (doesn’t matter if it is Dog tricks or Car Cleaning) in exchange for their opt-in e-mail.
2. You need to establish connections with as many people related to your targeted industry as possible. This is going to give you a much wider audience and essentially allow you to cherry pick the most active and highest paying users from your competitors list for years of marketing success.
3. GET YOUR LIST STARTED TODAY. Getting it started as soon as you possibly can allows you to compound your results and start seeing the power of list building, lifetime returns and a “list ATM” that so many affiliate marketers are used to at this stage in the game. If you are looking for a high quality service provider to use, Aweber comes highly recommended and gives you the first 30 days for ONLY ONE DOLLAR.