Thursday, 28 October 2010, 11:45 PM

What’s an Email Address Worth?

Maybe it’s hard to believe that an email address has a real “money” value, oh but it does. So, how do we figure it out?

Christopher and I sketched up 3 little pictures to show how you can calculate the average value of each individual email address. Now we’re going to dive a little deeper and use statistics for more than just how many emails were opened, or who clicked on what however many times.

To be able to use this formula you need to know the answers to three big questions:

This is just an example, obviously. This is what you’re going to do. First, insert your own numbers and divide the income amount with the number of subscribers you have. Then, multiply that number with the average amount of time you keep your subscribers. (Three years ago, companies in the US kept an address for two years on average.)

Now that you know how much each email address is worth, wipe the sweat off your forehead and lets take it a little further.

Okay, here is an example of how I would use email marketing to improve my numbers. I would need to have very accurate figures to know what I’m working with.

So basically, in this case, and in every case, it’s not just the number of subscribers. It’s all of them combined, they all matter to create profit. What’s a subscriber without a click? Or a visit? Or something bought? So, try different offers, or subject lines, and vary the time of day and week it’s sent out.