In this article, I’ll with you my journey to acquire 16,152 leads to build my newsletter audience from a mere $4,120.97 (or a quarter per lead).
Several years ago during Covid time, I want to get into the newsletter business but building a list from scratch was such a grinding.
It’s like a chicken and egg thing.
You got to have good content to attract new readers who will consume and share with others more and slowly you will build your list.
Growing a list organically from social media didn’t appeal to me because I am not a Facebook person and I just don’t check Facebook often.
Youtube is out of the option because you will get into the hamster wheel of creating content to feed YouTube’s algorithm so that it can send traffic over to you.
So growing organically is out of the equation because it takes time and is slow.
That leaves me with paid ads as a viable option.
But then I realized one sour truth…it’s a pay-to-play game.
The moment you stop paying, Facebook/Youtube stops sending traffic to you.
I sat at my desk and thought “There got to have a better way” to grow this thing FAST without paying forever and can’t find a solution yet.
So I am sleeping on it for some time.
Meanwhile, I was looking at e-commerce stores to acquire because when people get locked down from Covid, e-commerce stores are doing pretty well.
Then suddenly, it hit me one day that buying an e-commerce store can solve my newsletter’s traffic puzzle.
…because it’s such an overlooked traffic source that most owners often ignore it to capitalize.
How often do you receive email newsletters from an e-commerce store besides their sales emails (including coupons, discounts, promotion)?
Almost none of them is sending you meaningful emails.
With that in mind, I set out to do my research on targets and eventually acquired an e-commerce store from one owner who wanted to get rid of this store to make time for a product he wants to sell.
Cameron (the previous owner of the e-commerce store from which I bought) sent me a big CONGRATULATION after the acquisition was complete.
Here’s the Closing Statement from Escrow.com to show how much I paid for the whole transaction $4,120.97
Let’s see what I got from my mere $4K investment
- The valuable domain
According to GoDaddy, it values the domain of the e-commerce store at $1,268.
2. The inventory ($69K in retail value)
and here comes what’s inside the boxes.
3. The most valuable asset: THE EMAIL LIST OF CUSTOMERS (16,152)
To give you some context on how much you would have paid for 16,152 buyers, I pulled two benchmarks of paid ads on Google & Facebook for you to compare against.
According to Wordstream, the average cost per click (CPC) on Facebook ads is $1.68 while the average cost per acquisition (CPA) on Facebook Ads is $19.68 across all industries.
The typical cost per click for search ads in 2022 is in the range of $2 to $4 while the average cost per acquisition (CPA) on search ads is $55.68 across all industries.
Meanwhile, my cost per acquisition is around 25 cents ($4,120.97 / 16,152 = 0.255)
In other words, my cost per lead is already 7,700% cheaper than compared to Facebook Ads or 21,800% cheaper compared to Google Ads.
Let’s recap real quick:
- $(4,120.97) – investment
- $1,268 – Techsmrt.com domain
- $69,432 – Existing Inventory
- Credit = $66,579
- 16,152 – Customers (leads)
- CPL = -$4.12 (Get paid to acquire leads) = $66,579/16,152 = 4.12
For a whopping ROI of 1615% (66,579 / 4120.97)
Even if I am getting 1/10th of the ROI (161%), I am already a happy camper.
More importantly, the newsletter now has the audience it’s dying to serve!
Some insights I learned from this deal:
- Owned traffic is MUCH better than rent traffic (youtube/Facebook/or anything you have to pay for)
- Don’t be afraid to go against the common wisdom. In my case, I decided against using paid ads on Facebook and Youtube
- There are sellers waiting for you to gladly take away their business so that they can free up the time & energy to move on to something else. In my case, I got a great deal because the seller wanted to do something else.
- Business acquisition is the HIGHEST leverage you can do to scale up your business.
In fact, according to multiple sources, investment in SME space outpaced other investment category as high as 40x.