Why Buying Email Lists in 2024 is a Bad Idea

Email marketing continues to evolve, yet one constant remains: buying email lists is still a bad idea.

While it might seem like a quick fix to expand your reach, purchasing email lists can lead to many problems that ultimately harm your business far more than they help.

From legal issues to poor engagement rates, the risks associated with buying email lists are proven to outweigh the potential benefits:

1. Open rates: Metrics vary based on industry, but purchased lists average open rates between only 2-5%, while organically built lists can see open rates of 25-41%.
2. Conversion rates: Conversion rates for purchased email lists are significantly lower, typically falling below 1%, compared to 2-5% for organic lists.
3. Legal risks: Using purchased email lists can expose your business to legal troubles, especially regarding privacy laws like GDPR, potentially leading to hefty fines (potentially in the millions!) and damage to your reputation. 
4. Quality issues: Purchased lists often contain outdated or inaccurate information and emails, resulting in high bounce rates and lower engagement, negatively impacting your sender’s reputation and email deliverability. (Hint: You can easily fix these issues with EmailListVerify!)
5. Engagement metrics: Studies show that purchased lists have higher complaint rates, with more users marking emails as spam compared to organic lists.

Where is buying email lists legal?

The legality of buying email lists varies depending on the region, and if you ever do buy an email list, you need to know where it’s allowed to avoid landing in hot water.

Buying email lists & EU law

Under the General Data Protection Regulation (GDPR), buying email lists in the European Union is highly regulated.

GDPR requires clear and explicit consent from all users for data to be used for marketing purposes. This means that email addresses on purchased lists must have been collected with explicit and specific consent for marketing.

Failing to comply with GDPR can result in jaw-dropping fines, up to 4% of a company’s annual global turnover or €20 million, depending on which is higher.

Buying email lists & US law

In the United States, the CAN-SPAM Act governs email marketing practices. While the CAN-SPAM Act doesn’t explicitly prohibit buying email lists, it sets strict guidelines for sending commercial emails.

These guidelines include providing a clear opt-out mechanism, honoring opt-out requests promptly, and avoiding deceptive subject lines.

Non-compliance can lead to penalties of up to a whopping $51,774 per email!

Buying email lists & Canadian law

Canada’s Anti-Spam Legislation (CASL) is one of the strictest in the world regarding email marketing. CASL requires businesses to obtain explicit consent before sending commercial emails, similar to GDPR.

This consent must be documented, and businesses must provide clear opt-out mechanisms in their communications. Violations of CASL can result in fines of up to $10 million per violation.

Types of email lists you can acquire

When considering email marketing strategies, it’s essential to understand the different types of email lists available. Each type comes with its own set of benefits and challenges, and knowing the distinctions can help you make informed decisions.

Opt-in email lists

Opt-in email lists are composed of people who have explicitly agreed to receive communications from a business.

These lists can be single opt-in, where users sign up once, or double opt-in, where users confirm their subscription through a follow-up email.

These types of lists are considered the gold standard in email marketing as they guarantee higher engagement rates and compliance with privacy regulations.

Rented email lists

Renting an email list means paying a provider to use their email list for a specific campaign. Instead of receiving the actual email addresses, you provide your marketing content to the list owner, who then sends it out on your behalf.

This method allows you to reach a broader audience without permanently acquiring the email addresses.

However, the effectiveness depends on the quality and relevance of the rented list, and it still carries the risk of low engagement and potential legal issues.

Bought email lists

Buying email lists involves purchasing a list of email addresses from a third-party provider. These lists are often compiled from various sources and sold to multiple businesses.

This practice is discouraged and looked down on due to significant drawbacks and the lack of consent from the receiving parties.

Purchased email lists often include outdated or irrelevant contacts and lack the necessary consent required by many privacy laws, leading to low engagement and potential legal consequences.

The drawbacks of buying email lists

While the idea of quickly expanding your reach by buying an email list might seem appealing, the reality is fraught with more drawbacks than benefits.

Understanding these can save you from wasted efforts and money, a damaged reputation, and the threat of legal issues detailed above.

Low engagement rates

Have you ever received emails from a business you’ve never heard of or have no interest in and thought, “Wow! Perfect! This is just what I’ve been looking for!”, or did you roll your eyes and move on?

99% of the time, you’ve probably done the latter. That’s how other people will look at your messages when you send them unsolicited messages. 

Recipients on purchased lists are often unfamiliar with your brand, leading to low open and click-through rates.

While open rates vary by industry, the average is 21.5% across all industries. But with purchased lists, the open rate rarely exceeds 5%. 

Furthermore, when you purchase a list, you typically have very little information about the prospect. This lack of metadata makes it difficult to properly segment and customize the email.

Proper segmentation and customization are important for engaging your readers, as they make the email feel relevant and personal.

Without detailed information on the prospects, your emails are likely to be generic and unappealing, leading to even lower engagement rates.

High spam complaints

Sometimes, rather than just not opening the emails, people will report them as spam, leading to more negative consequences:

• Damaged sender reputation: High spam complaint rates harm your sender reputation, making email service providers (ESPs) view your emails as suspicious or unwanted.
• Email filtering: ESPs may then start filtering your emails into spam folders automatically, reducing the chances that even your genuine recipients will see your messages.
• Blocked emails: In severe cases, ESPs might block your emails entirely, preventing any of your emails from reaching the right inbox.
• Lower deliverability: High spam complaints also lead to lower overall deliverability rates, affecting not only the current campaign but also future email marketing efforts.
• Increased bounce rates: As ESPs block your emails or filter them into spam folders, your bounce rates can increase, further damaging your sender’s reputation.

Recovering your reputation after you’ve damaged it can take a long time, which means more money and time spent on email marketing that likely won’t get you any ROI until you’ve healed the damage.

Poor quality leads

The contacts on purchased lists likely won’t be your target audience, leading to poor quality leads, or no leads at all.

These lists often contain outdated or incorrect information, further reducing the likelihood of conversion. Investing in such lists results in wasted marketing efforts and budget with little to no return on investment.

TIP: Looking for great leads? Check out this guide on sales prospecting!

Damage to brand reputation

Another consequence of rented or purchased email lists is creating a bad reputation for your company. Recipients are likely to view your emails as intrusive, which can foster negative perceptions of your business.

Building a positive relationship with your audience is essential for long-term success, and relying on purchased lists undermines this effort.

Limited control

When you rent an email list, you don’t own the list. Instead, you pay to use the list for a specific period or a certain number of email campaigns.

This means you have limited control over the list and its contents. You can’t modify the list, and you may not be able to segment it to target specific demographics or interests effectively.

Another problem with rented lists is that you might lack critical information about key performance indicators (KPIs) like deliverability, open rates, and click rates, as you aren’t the one sending the emails.

Without access to these metrics, it becomes challenging to assess the effectiveness of your campaigns and make necessary adjustments.

Potential for high costs

Renting or buying email lists can be expensive, especially if the list is large or highly targeted. Given the potential for low engagement and conversion rates, the ROI can be poor.

According to Email Vendor Selection, the cost to rent an email list varies depending on demographics, regions, and the size of the list.

For a B2C list, a targeted email list of 2,500 to 5,000 addresses typically costs between $200 and $400. For a B2B list, the cost ranges from $300 to $600.

Buying a list can be even more costly – ranging between $100 and $600 per thousand email addresses.

Email lists with opt-in contacts

Opt-in email lists are the absolute best route to take in email marketing.

Building and maintaining an opt-in email list can be more time-consuming than buying or renting lists, but the benefits are worth the effort.

High-quality engagement

Opt-in email lists typically result in higher engagement rates. Since recipients have actively chosen to receive your emails, they are more likely to open, read, and interact with your content. 

This leads to better click-through rates, conversions, and overall campaign success.

Here are some common engagement rates across industries:

Source: Get Response

Legal compliance

Using an opt-in email list means that your email marketing practices comply with regulations such as the GDPR, CAN-SPAM Act, and other data protection laws.

These regulations mandate that recipients must give explicit consent to receive marketing emails. Using opt-in lists is an easy way to avoid the risk of legal penalties and fines associated with unsolicited emails.

CAN-SPAM, on top of requiring a clear and functional opt-out method, even prohibits the use of misleading headers and subject lines.

Tip: If you’re worried about CAN-SPAM hitting you with a fine of $50,120 per misleading email, be sure to check your emails with a free spam words checker.

Improved brand trust and reputation

Building an opt-in list demonstrates that you respect your audience’s privacy and preferences.

This approach fosters trust and strengthens your brand reputation. Customers are more likely to view your business positively when they feel their consent and privacy are valued.

Better targeting and personalization

With opt-in lists, you can collect additional information about your subscribers during the sign-up process. This data lets you segment your audience and personalize your messages to specific groups, making your campaigns more relevant and personalized.

Targeted emails make more of an impact on recipients, increasing the likelihood of engagement and conversions.

In conclusion, opt-in email lists are the most effective and ethical approach to email marketing. They ensure compliance with legal standards, enhance deliverability and foster trust with your audience. By focusing on building and maintaining an opt-in list, you can achieve better engagement, higher ROI, and long-term success in your email marketing efforts.

How to build an opt-in email list

Are you ready to leave the temptation of a quick fix behind and build your own email list? We asked our CMO of EmailListVerify and Warmup Inbox, Fabian Maume, for his expert insights.

1. Define your target audience and collect emails

Firstly, you have to understand who your ideal email audience is. Your business likely has different audiences for different platforms.

Source: WordStream

So how do you gather an audience?

“One great way is through the use of your free tools. If you have any free tools or offers in your site, you can embed an email collecting form there, it’s quick and easy to implement. We’ve had a great experience with EmailListVerify.” – Fabian Maume

Other ways to build up your consensual email list include:

Website pop-ups: Use pop-ups on your website to capture visitor emails. Offer a discount, free trial, or exclusive content in exchange for their email address.

Landing pages: Create dedicated landing pages with clear calls-to-action (CTAs) that encourage visitors to sign up for your newsletter or special offers.

Social media campaigns: Run social media campaigns that direct followers to a sign-up form. This can be paired with a giveaway or contest to increase engagement.

Content upgrades: Offer additional content in your blog posts, such as a downloadable PDF, in exchange for an email address.

Webinars and online events: Host webinars or virtual events and require attendees to register with their email addresses.

Referral programs: Make a referral program where existing subscribers can refer others to sign up for your email list in exchange for rewards.

Networking and events: Collect emails at trade shows, conferences, and other networking events by offering something valuable, like an eBook or a report.

Email signature: Include a sign-up link in your email signature so that every email you send has the potential to be added to your list.

TIP: For more information, check out our guide on how to build an email list.

2. Implement double opt-in

More like step 1b, be sure to use double opt-in for all of your email collecting efforts. Double opt-in simply means sending a confirmation email to new subscribers to verify their email address.

Source: Get Response

3. Segment your list

It’s not enough to just have the email addresses, you should also segment them based on things like interests, demographics, stated preferences, behavior with your site, and other parameters you find useful.

Segmentation has great engagement rates:

Source: Email on Acid

Dividing your list into smaller, more targeted groups based on specific criteria means you can send more relevant content to each segment, leading to better open rates, click-through rates, and conversions.

4. Create valuable content and an engagement strategy

Before you start making your content, you should think about how often to engage your audience, and what you’ll do if they become inactive.

We asked Fabian how you can maintain engagement with your email subscribers and prevent them from becoming inactive:

“It depends a lot on your product. If you are selling SaaS accounting software that’s only used once a year, your email frequency should be much lower than if you are an e-commerce about fast fashion.

Your email marketing frequency should align with your product usage frequency. It’s better to leave a user’s inbox inactive than to get spam reports because you’re sending emails too often.

If some users get inactive you can try to remarket them with ads. Twitter & Facebook allow you to create custom audiences based on email addresses. You can then target those people with ads to re-engage them.”

Source: Lolly Daskal

After your list is segmented, it’s time to start thinking about what you’ll be saying in these emails.

Here are some great ideas to inspire you:

Newsletters: Regularly send newsletters that provide updates, insights, and valuable information related to your industry. Include sections like the latest news, upcoming events, and featured articles to keep your audience informed and engaged.

Educational content: Share informative articles, how-to guides, and tutorials that help your subscribers learn something new. This can position your brand as an authority in your field.

Exclusive offers: Provide special discounts, promotions, and early access to new products exclusively for your email subscribers. This makes them feel valued and encourages loyalty.

Product updates: Keep your audience informed about new product launches, feature updates, and improvements. Highlight the benefits and unique selling points of your products.

Customer stories: Share testimonials, case studies, and success stories from your customers. This not only provides social proof but also helps build trust and credibility.

Interactive content: Include surveys, polls, and quizzes to engage your audience and gather valuable feedback. This makes your emails more interactive and fun.

Personalized recommendations: Use data from past interactions to send personalized product recommendations. Tailoring content to individual preferences increases the likelihood of engagement.

Seasonal content: Create content that aligns with holidays, seasons, and special events. This can make your emails more timely and relevant.

Event invitations: Invite your subscribers to webinars, workshops, and live events. This fosters community and provides additional value.

TIP: Did you know that infographics are another easy and effective way to engage? Have a look at our infographic best practices guide!

5. Warm up your email account with Warmup Inbox

Warmup Inbox is a powerful, affordable service designed specifically to prep your email for all the emails you’ll soon be sending, and it can significantly enhance your email deliverability and sender reputation.

Here’s how Warmup Inbox can benefit you:

1. Effortless setup: Simply grant access to your email account through the platform, and you’re ready to start warming up.
2. Customizable warm-up settings: Tailor the warm-up process to suit your needs. Warmup Inbox gradually increases the number of emails sent from your account over a specified period, helping you build a strong sender reputation without triggering spam filters.
3. Automated engagement: Warmup Inbox uses a network of real email accounts to interact with your emails. These accounts open emails, mark them as important, and move them out of the spam folder, mimicking genuine engagement.
4. Detailed analytics: Stay informed with comprehensive insights provided by Warmup Inbox. Monitor the progress of your warm-up, track the number of emails sent, and analyze engagement data.

Interested in seeing what Warmup Inbox can do for you?

6. Verify and maintain your email list with EmailListVerify

Keeping your email list clean and accurate is essential for successful email marketing. One of the best tools to help you with this task is EmailListVerify. Here’s how to utilize it and other practices to maintain a healthy email list:

1. Email verification with EmailListVerify
   • Clean your list: Use EmailListVerify to regularly scan and remove invalid or risky email addresses from your list.
   • Improve deliverability: By eliminating bad addresses, you reduce bounce rates and guarantee more of your emails reach their intended recipients.
2. Regularly remove inactive subscribers:
   • Audit your list: Periodically review your email list to identify and remove subscribers who haven’t engaged with your emails in a while.
   • Maintain Engagement: Keeping only active subscribers helps maintain a high engagement rate, ensuring your campaigns are more effective.

Integrating these email hygiene best practices and using EmailListVerify helps you keep your email list fresh, active, and effective.

7. Comply with legal requirements

Start by adhering to regulations like GDPR and the CAN-SPAM Act. For GDPR compliance, it’s important to obtain explicit consent from your subscribers before adding them to your email list, clearly explaining how their data will be used.

Under the CAN-SPAM Act, make sure to include your physical mailing address in every email and avoid misleading subject lines.

Providing easy opt-out options is another essential step. Always include a visible and user-friendly unsubscribe link in your emails, allowing recipients to opt out of your communications effortlessly. Promptly honor all opt-out requests to stay compliant and maintain a positive reputation.

Conclusion

There you have it! Everything you need to know about email lists and how to create your own list of eager readers.

Before you get tempted to buy or rent an email list, remember that opt-in email lists are essential for effective and compliant email marketing.

They lead to higher engagement, fewer spam complaints, and better overall campaign performance.