I believe the concept of list building, as commonly taught within the internet marketing community, is a distortion (and misunderstanding) of the concept and objective of direct response lead generation (DRLG), sometimes referred to as 2-step marketing.
The result of this distortion is a myopic focus on the building of a big list and database of prospects. And, while there is enormous benefit to being able to regularly communicate with a big audience of targeted prospects for your product or solution, the aim should always be to build a big list and database of customers.
The original concept of direct response lead generation, as popularized over a decade ago by Dan Kennedy, was all about generating a lead first, so you have the opportunity to plug those prospects into a multi-step, sequential follow-up sales system. Today, we refer to this multi-step sales system as a marketing funnel.
The purpose of a marketing funnel is, ultimately, to take a fresh prospect, put them through a strategic series of education-based marketing communications, and consummate the sale in the shortest time possible permitted by the buying cycle.
In other words, with traditional direct response lead generation, the objective was not just to generate a lead and build a database of prospects. The objective was to generate a lead so you could put them through an optimized marketing funnel that profitably allowed you to acquire new customers.
The aim always was, and always should be, to spend a certain amount of money generating leads, to then extract equal or more money from those leads through your front-end multi-step follow-up system. And, to do it in the shortest time possible to recoup your marketing costs and maintain positive cash flow.
The Flaw With Listbuilding Is…
The flaw in thinking with listbuilding as commonly taught and accepted within the internet marketing community is that the sheer acquisition of prospects on your email list has value in and of itself. It doesn’t.
The value in lead generation is knowing that your marketing funnel will extract an equal or greater amount of money in front-end new customer transactions than what was spent to put prospects into your marketing funnel.
This is why the biggest, most successful direct response marketing companies like Agora, Boardroom, Weiss Financial, etc., focus on the building of customer lists, not prospect lists.
It’s also why, I feel, having an email list of over 100,000+ prospects that have gone through a new customer marketing funnel and haven’t bought is not the mark of a master marketer. It means the marketer’s front-end funnel wasn’t optimized enough to be able to sell their product or service to those 100,000 people.
Again, generating prospects is not the aim. Generating customers is.
Am I Saying There’s No Value In Generating Leads Or Collecting Opt-Ins?
Absolutely not!
Of course there’s value in generating leads and collecting opt-ins – as long as those leads and optins get plugged into an optimized marketing funnel that generates enough new customer front-end transactions to recoup your marketing dollars and grow your customer base.
So here’s the key takeaways:
- Start focusing on the number of new customers you generate on a daily basis, as well as the daily, weekly, and monthly growth of your active customer list.
- Start monitoring how well and how quickly your marketing funnel is converting new prospects into customers, and at what cost per sale.
- Start monitoring the prospect value (avg. visitor value) of your marketing funnel from optin to the final funnel step (excluding any marketing communications post-marketing-funnel). This will give you true measurement of how well your front-end marketing fnunel is performing.
- And, finally, start monitoring your marketing funnel with an eye on where the constraint is within the funnel – the weakest performing step – so you know where your optimization efforts are needed most.
And always remember, the ultimate goal of having a squeeze page (optin page) is NOT to build an email list of prospects. It’s to plug prospects into a funnel that converts enough into new customers at breakeven or better.
Question: What are your thoughts about list building? Leave a comment by clicking here.
