Then you're going to have to agree on a price. That's another question I get "What's a fair price?"
I'm not going to give you an exact price here. I hesitate to name anything at all, but I know you
want something.
Let me try and explain: I want you to get the picture that it's okay to pay $20 / subscriber if you
have a back end in place and those are good subscribers and you end up making $200 a piece on
them. It's okay to pay $20 / subscriber.
On the other hand, it's not okay to pay 10¢ for a subscriber if all you're going to be able to do is
turn that 10¢ subscriber into 20¢ in revenue.
The number that you're going to pay per click or per subscriber should be dictated based on your
potential revenue from whatever it is you're doing.
For example, if you are able to generate $20 per subscriber over the course of the year, you might
be willing to pay $2 or $3 per subscriber up front to build your list.
What if you're just starting out, and you have no idea about your back end? You don't even have
a product, you're just trying to get 500 subscribers on your list so that you can send them some
emails and find out what kind of product you should make…
Maybe you pay $2 / subscriber, so it'll cost you $1k to get 500 subscribers, and you're not going
to make any money on these individuals right away. You're going to have to create your product.
It might take you 2 weeks to create your product the way that I teach to create a product. So
you'll get a percentage of those people to buy, and maybe you'll break even on your ad . But
you're not going to have anything to sell them the first 2 weeks.
When you build that first part of the list, you simply have to look at it as an investment. Once
you've done this 25 times, you should know over time how much you make on average per
subscriber. Why don't I give you a quick formula?
Let's just say that you get 1k new subscribers every single month. And you generate $20k every
single month. You're averaging $20 / subscriber.
Another way to look at this would be to look at an actual basket of subscribers. Let's say you get
1k subscribers. Then you track THOSE 1k subscribers separately from everybody else for a year,
and those 1k subscribers generate $20k. That's another way to do it.
I find that just using the monthly new subscribers, divided into the total number of revenue that
you have, gives you a nice average.
Now, if one month you generate 100 subscribers because you don't do much of anything, and the
next month you spend $5k and get 2k subscribers, and the next month you only get 100
subscribers, then you have to take a rolling average of the number of subscribers each month and
divide that into a rolling average of your revenue because your revenue is going to be driven by
the number of new subscribers, but it's not going to correlate month to month. The reason for this
is because people don't make all of their expenditures the first month they get on your list. I think
that's enough depth on that.
It's just a quick process: how many subscribers are you getting, how much money are you
making, that's your $/subscriber. Once you know that, then you can think about how much can I
pay per subscriber.
Normally when you buy your solo ad, you can negotiate to pay per subscriber. Paying per click is
more common. Obviously, per click becomes a little bit tricky, because you don't know what
your subscriber cost is going to be, especially for the first few solo ads that you run. Let's just
imagine that you have an opt-in page that has a 25% conversion rate. You want to be at $2 /
subscriber. Then you're going to have to get 4 visitors, or 4 clicks, to get one subscriber. So
you're going to want to pay 50¢/click to get to $2 / subscriber.
You may be talking with someone they'll only sell you something that's $1/click. You have to
ask yourself, is this list going to be strong enough that I can monetize $4 / subscriber? Again, if
it's your first list, set $1k aside and just use that as your seed money, as your investment money,
to build that first list of 500 or 1k individuals.
Your pricing is just going to be a negotiation.
Ad Swaps
When I gave the sample letter above, I asked if the list owner was interested in doing some kind
of mailing – perhaps a solo ad or an ad swap.
Let's talk about what an ad swap is.
An ad swap is a solo ad where you give them a reciprocating solo ad. Instead of paying Johnny
$300 to mail your ad to his list, and then having him pay you $300 to mail his ad to your list, you
just do a swap. He mails your list, and you mail his list.
Those are the steps to driving traffic with solo ads and finding your own solo ad providers.
Buying Ad Drops to Very Large Lists
There are two more things I want to share with you to wrap up this training.
From time to time you'll come across some big emailers in your niche. Maybe somebody that has
a 150k subscribers. And they don't go by “Johnny” anymore. They go by the such-and-such
mailing corporation. At first glance you might look at that and think they’re commercial and not
a good fit for you.
But, if they're not in the business of selling as many solo ads as possible, they may be a good
choice. Maybe they advertise that five times a month they open up a solo ad spot. That may be an
email that you could be interested in sending.
With those types of relationships, you basically buy your way in. They're saying we do five
mailings a month, and to mail to our list it's $2k a mailing. This is what it is. Because it's a huge,
mass list, you're probably not going to get the same conversion rate response as you would on a
smaller list.
As you grow your business… let's say you're running something new, and you want to get 5k
subscribers next month, well that's a lot of work if you do it 50 subscribers per mailing. But, if
you can get two people, or two companies that can get you 2k subscribers each in their mailings,
that’s 4k subscribers right away. Then 20 little guys to give you 50 apiece, so you've got your 5k.
So sometimes having a big mailer, even if the quality is a little bit lower, can work well to get you
sheer volume. I’ve done that before. I've bought lots of quality ads. I really wanted to hit some
numbers. I bought a couple of big ads that the quality wasn't there, but if I broke even or better
when you average it all together, it works out and I've got the numbers.
Track Everything
The second thing that I want to give you is this: you should keep track of everything that you do.
I like to use a spreadsheet. You can just use a basic spreadsheet.
Across the top your columns read:
Name of Provider
Email Address Where Provider Can Be Reached
How Much Money Paid
How Many Clicks Promised or Estimated?
How Many Clicks Actually Received
Dollars per click (divide the dollars spent by the number of clicks)
Subscribers Received
Dollars per subscriber (divide the number of subscribers by the number of clicks)
This is not going to be useful information the first 30 days, or really the first 60 days.
You're going to go out and say you mailed 30 solo ads the second month. In the first month
you're doing your research. The second month you mailed 30 solo ads. You're going to write all
this information down on your spreadsheet. It's not going to mean anything to you until the end
of the second month.
After you've done all your mailings, then you're going to sort the list by dollar per subscriber.
You're going to find that 50% of that list (I'm going to tell a funny here) 50% of that list is going
to be above average. 50% of that list is going to be below average ;)
You may not mail to the half that’s below average. Or maybe you won’t mail to the bottom 20%
in the future. The only way that you'll remember down the road not to mail to these people is to
keep records. You can just keep a record of it in your handy-dandy spreadsheet and 5 years from
now you can look back, and when you're thinking about doing a mailing to Johnny, you can
reference it. You’ll say, “I know I mailed from Johnny before, Johnny mailed for me before, how
did it work out? Aww, conversion was really, really low. Maybe I should tell Johnny I'm not
interested in doing this right now. Or maybe I should tell Johnny that conversion was really low
last time, the only way I can do this is if we split the price in half.” Whatever the case is.
Let me say this also. From time to time, you run 30 solo ads. One or two people are frankly not
going to perform on what they promised. They may have lied to you about the size of their list.
That happens. It just happens. Recognize that a percentage of people will do that. At the end of
the day you still have some average subscriber cost. If you use your emotional energy being
bitter towards that person, if you use your emotional energy to say, “you know what, Johnny lied
to me and I spent $200, and I lost that money.” And then next month you decide you’re not doing
any solo ads ever again because Johnny stole your money… Well, you're not going to build a
business. If you run 30 solo ads and 25 people perform, and you put 5 people on your blacklist,
you know what… thumbs up! You've done a good job, and next month, you know the 25 people
you can talk with.
The next thing that you can add into your spreadsheet, if you so desire, and if you have things set
up in your business to track this, is to track the money you generate over the course of the next
year, and tie it to a particular lead source.
If you have the capacity to do that without too much work it’s nice to say that Johnny's
subscribers made you $55/ea., but Becky's subscribers only made you $7/ea. What does this
mean? It means that a year down the road, when you're thinking about running solo ads again,
you know that you can spend everything that you have on Johnny, but you're not going to spend
anything with Becky.
The 3rd Month
The final step here is the 3rd month…
The 1st month is research.
The 2nd month is you buy your 30 ads (or 5, or 60, whatever your budget is)
By the way, if you run three ads your first month, two of them could flop. All three of them
could flop. If that's your budget, that's okay. Just recognize that if all three of them flop, it doesn't
mean that this doesn't work for you. That doesn't mean that everybody in your niche is a liar and
a cheat, it just means that the three that you happened to choose were the same three that would
have been on the list of 30 that were bad ones. It's just bad luck.
The more that you can mail (I like to start with a minimum 10), the better overall picture of
what's going on that you'll be able to come up with.
The 1st 30 days, research.
The 2nd 30 days 30 mailings.
The 3rd 30 days you're going to go back and you're going to find the best mailings that
you did.
Find the top 15 people. You're going to go back to those individuals, and say, "Hey, would you
like to do another mailing?" And, assuming that they didn't get too many complaints from their
subscribers about your offer, they'll probably take your money and do another mailing.
What does this mean? This means that every single month, after the 1st month, it doesn't take a
whole lot of work to run these solo ads. Over time you'll just get a feel for which lists are good.
You can keep joining lists and you’ll get a feel for the ones showing promise.
Over time, if you'll do this diligently, spending an hour or two a week, you'll be able to mail: 5,
10, 15 solo ads a week. And, over time, you'll get to the place where you're only willing to mail
bigger solo ads. So instead of running 30, 50 subscriber solo ads, you run 30, 100 subscriber ads.
Then 30, 200 subscriber ads. Then 30, 1000 subscriber solo ads. This allows your business to
grow organically and naturally over time.