Why purchased lists are a big no-no

It is not the fact of it being right or wrong which surprises me; it is the fact that some marketers still take the gamble on using them. I know at one point it was a widely accepted practice in the marketing world, but with today’s much stricter regulatory landscape and advanced classification and detection technology, one would think the gamble is not worth it.

To this day, there is still much debate on the use of purchased lists. Most reputable Email Service Providers do not allow their use and will terminate a sender if they detect them. At Dotdigital, our Terms & Conditions strictly prohibit their use. While this may seem harsh, there are many good reasons NOT to be using purchased lists in the first place:

Addresses on a purchased list are likely to be poor quality. The main point to remember is, the recipients on such a list have never opted in for your specific emails. Additionally, many purchased lists contain older email addresses. Because of these two factors, you are very likely to see higher complaint rates and higher bounce rates. Typically, a bounce rate below 2% is optimal, and if it goes over 5%, there is a problem. If there are some active email accounts on this type of list they will be more likely to delete the email (without reading it), since they never asked to receive it. However, these active recipients are more prone to mark the email as spam, which will definitely hurt your sender reputation and ultimately your brand reputation.

Another good reason not to use purchased lists? Spamtraps! Often, list brokers will create fake email addresses in order to increase the size of their lists and to create a more “attractive” product. They will make up domain names and use random words as email addresses. Several groups within the anti-abuse community will discover these domains, purchase them and turn them into spam traps.  If you hit a spam trap used by a receiver like Gmail, Hotmail or Yahoo! or an anti-abuse organization like Spamhaus, you will find yourself quickly blacklisted or blocked from sending.

The last point I will make about purchased lists is the obvious legal and ethical implications that come with their use. It is always important to remember that when you send an email campaign, you are sending to a real person. If people did not ask to hear from you and suddenly receive an unexpected email in their inbox, they tend to complain. In many jurisdictions, this would be considered illegal. You have forced your way into someone’s inbox, and that is not a great way to start a business relationship in the first place.

Keep in mind that the new General Data Protection Regulation (GDPR) will come into effect on 25 May 2018. While consent remains a lawful basis to transfer personal data under the GDPR, the definition of consent is significantly restricted. Directive 95/46/EC allowed controllers to rely on implicit and “opt-out” consent in some circumstances, but the GDPR requires the data subject to signal agreement by “a statement or a clear affirmative action.” Not to mention, almost all other anti-spam, privacy and data protection legislation prohibits contacting someone who has not given you the proper consent.

There are many ways to increase your subscriber base without hurting your reputation or brand.  The most obvious way is to use sign-up forms on your website. Contests, giveaways and other promotions are great for incentivizing these sign-ups. You can use social media to drive traffic to your promotions and entice even more organic sign-ups. Pop-ups, sliders, feature boxes and surveys are other great methods for healthy list growth.

Buying a list may seem like a quick fix, but in the long run it will cost you in terms of lost revenue and damage to your sender reputation. It can even get you in to legal hot water. Take the time to organically grow your lists and ensure all of your recipients are opted in. We recommend double opt-in or confirmed opt-in as a best practice. Email marketing relationships are a valuable marketing asset. In fact, 91 percent of consumers want to receive emails from the organizations they do business with.  Building these relationships starts with making sure you have permission before adding someone to your email list.

For more reading on this subject, check out this article by Word to the Wise. Laura Atkins, email marketing legend and well-respected industry expert, points out the fact that even if you hear someone say their ESP is allowing them to use purchased lists, they probably just haven’t been caught yet.