Negotiating Prices for Lists

Mailing and contact lists are usually rented or sold by CPM, at a given variable price per 1,000 e-mail addresses, mailing addresses, phone numbers, etc. B2C lists usually range from $20 to $100 CPM. B2B lists range from $80 to $500 CPM, depending on the perceived value associated with the information on the list. Be aware that CPMs for business-related lists will usually be higher than CPMs for consumer-related lists, because business-related lists are worth more and provide better ROMI to the companies that buy them.

Be aware that CPMs tend to be negotiable. List owners know there are flaws in the techniques they use to compile their mailing and contact lists. They will often price a list according to how accurate they think it is. There’s a lot of flexibility in list pricing, so try to take advantage of that when you negotiate a price for buying or renting a mailing or contact list.

You should know your target CPA when you approach the list owner, estimate your ROMI based on the CPM rate the list owner is offering, and use your target CPA to negotiate. For example, say you’re selling a $250 product using e-mail marketing, and your target CPA is 10% of the price (e.g., $25 or less). If a list owner is offering a list at a $500 CPM rate, you pay $500 for a list of 1,000 e-mail addresses. If only 10 people on the list of 1,000 end up buying the $1,000 product, your actual CPA is $50, which is double the target CPA you wanted to spend.

But you can then go back to the list owner and negotiate a better CPM for the next list of 1,000 e-mail addresses that you buy from them. You can ask for a $200–$250 CPM, which (if you get the same response to your e-mail with the next list of 1,000 names) will put you within your projected $25 target CPA.

Also, be aware that you can negotiate lower prices for high-volume lists. For example, you may be able to rent a list with 25,000 e-mail addresses at $100 CPM ($2,500 total). But a list with 100,000 e-mail addresses might be negotiated down to $50 CPM ($5,000 total) due to volume. The price is doubled, but you get four times as many names, so the 100,000 list may have a higher value for you.