List building is crucial to any internet business and everyone talks about how important it is and how their lists are the key to their success. But ask them what a list is (or should be) and how it should be used and many of them will be at a loss.
List building might best be explained as follows. Your list is a database of people who would be interested in the goods or services you are selling and list building is the process of expanding your base of potential customers. To put it another way, your list is your market and list building is the activity of increasing it.
People visit your site because something about what you have to offer has attracted their interest – how and why they get interested is another subject altogether. But having an interested visitor is not the same thing as making a sale – very few of the first expressions of interest ever turn into actual sales. To generate sales you will need to build up recall of your website by staying in the mind of those who form your market – you will need to keep reminding them that you have products that they will benefit from buying. To do this you will need to be in regular contact with them and keep sending them information that will excite their interest along with reasons why they can satisfy their need by buying form you.
A website is a faceless entity in the cyber world and to get someone to pay money to it they will need to have trust and this can only be created by constantly offering information of value and reason why they should buy from you. The basis of all this communication is your list of email addresses and that is the market you will be selling to.
Many rookies to ecommerce mistakenly think that when it come to lists, size is all that matters. It doesn't work that way – what good is list of 10,000 email address of people in Iceland when you are trying to sell Bermuda shorts? A good list is one where there can be a good conversion rate, not one that is simply full of email addresses – a conversion rate of 20% with a focused list of 1,000 addresses will be far more profitable than a list of 10,000 that results in a conversion rate of just 1%.