Affiliate Moguls Blog
About Affiliate Moguls
Founded by Meghan Damico and Ryan Alarid, Affiliate Moguls is a consulting business that specializes in hiring, training, and optimizing affiliate and email media buying programs. 

With over 15 years of direct response marketing experience, they bring a wealth of experience and connections to each partnership.
Three Ways To Negotiate The Cost of A New Email List
Written by Meghan Damico on January 19, 2021
There are a lot of email lists out there that don’t do CPA (cost per acquisition).
 
That means if you’re not also buying email media you’re missing out on a lot of opportunity.
 
However, email media buying can be more risky than affiliate marketing. 
 
That's because you’re paying a flat fee, CPC (cost per click), or CPM (cost per thousand) to rent an email list rather than paying on CPA.
 
All the pressure is on your creative and offer to perform well.
 
A lot of businesses don’t do email media buying because they think it’s too risky or they don’t know enough about it.
 
Which is why we like to coach our clients on how to diversify their acquisition strategy by profitability buying email traffic.
 
The number one question we get asked is, “How do I negotiate lower costs?”
 
Below I’ve outlined three very simple ways in which you can negotiate a lower cost when renting a new or existing list:

1. Know your numbers
List owners and brokers will be 1000x more responsive and open to working with you if you know your numbers.

This means that you know your offer’s average CR (conversion rate), your goal CPA or breakeven metric, your ACV (average cart value), and what creatives perform best.
 
A good list broker or list owner should communicate to you the list size, average open rate, average click through rate, and cost of the list (and if not you can also ask for it).
 
If you know this the rest should fall into place.
 
For example if you know:
List size: 100,000
Average open rate: 12%
Average CTR: 7%
Average CR of your offer: 1.5%
ACV of your offer: $100
Cost: $2,000

Then you can calculate:
Potential orders: 12
Potential revenue: $1,260
Potential CPA: $158
Potential breakeven: 63%
 
Let’s say our KPI for this offer was either a $130 CPA and/or an 80% breakeven.
 
At a $2,000 price point, this email drop isn’t going to back out.
 
But, if you run the numbers again, it could work at a $1,600 price point.
 
That’s only a $400 difference that you can negotiate with the list broker and/or list owner.
 
Which leads me to #2:

2. Buy in Bulk
Assuming you have more than one offer or creative to send, you can also negotiate email costs by buying in bulk.
 
Using the above example, you could go back to the list broker and/or list owner and ask if they can give you a $400 discount if you buy two dedicateds instead of one.

Or, if you buy six dedicateds you get the seventh for free. 

Or, if you buy three dedicateds you get three insert ads/sponsorships for free.

Etc...etc... you can see where this is going :) 

3. Test Half The List
Don’t let big, expensive lists give you anxiety.

Just because a list is $10,000 doesn’t mean it can’t be profitable.

One of my favorite sayings is, "Every list works at the right price."

But let’s say after doing the above numbers exercise you’re still not sure if the 250K, $10,000 buyers list is going to work in your favor.

What should you do?

My recommendation would be to see if you can rent half the list - 125K for $5,000.
 
The risk here is a lot less because if it works the payoff could be huge.
 
But if it doesn’t work, you’re not out $10,000.
 
This is pretty common practice for larger, more expensive lists. List brokers and list owners know the only way to get potential new clients is to offer half the list.
 
And if they say no, ask what other options are available to you to test at a lower risk to you.
 
For example, they might offer you an insert ad/sponsorship that goes to the whole list, but at a lower price because it's not the only ad in the email.
 
Using these simple tactics, as well as going through our Email Media Buying Masterclass course, can help you become a respected, expert media buyer.

AFFILIATE MOGULS | Copyright ©2021 | All Rights Reserved