You must also make it quick and easy for subscribers to say good-bye. Each issue of your newsletter should contain information explaining how to unsubscribe or be removed from mailing list. There are many forms this information can take. To choose one, go through email newsletters you now receive, and decide which you like best. Then, prepare your own notice, using this one as a guide. Of course, you will not copy anything directly, which would be plagiarism.

On flip side, add information to each newsletter that explains how to subscribe, and consider, too, putting in a line asking recipients to pass along your newsletter to someone else who would benefit from it. A simple reminder like that could help you build your list, painlessly. Recommendations from a trusted colleague or friend will boost your subscriber list quickly.

Summing up, develop a privacy policy and stick to it. In addition, give your subscribers an escape hatch they can access quickly and easily.

4. What is each customer worth? How much does your average customer spend with you? At first, I found this difficult to calculate because my customers range from a $9 e-book to $1,000s of dollars each year in coaching. In addition, I receive passive and residual income from my customers which comes from their use of products and services I recommend. But then I looked at my accounting program and simply took my total income for year and divided it by number of clients. This showed me that my average client spent $259 in 2004.

5. Calculating value of your leads. Here is formula to calculate value of your leads:

Value per lead = value per customer ÷ number of leads needed to generate 1 customer.

In my case, my accounting program for 2004 showed an average expenditure per customer of $259. In my own case, I believe that 1 out of every 25 signups will result in a sale.

Value per lead = $259 ÷ $25 = $10.36

In my case, each lead I generate should bring me $10.36 in sales.

5. What about profitability? If I spend $10 to generate $10 in sales, I don't make any profit and I haven't covered my costs of operating.

If I assume that I currently make $5 profit on a $10 sale, I might want to set a target of paying a maximum per lead of $2. This way, on a $10 sale, my total cost including cost of lead plus cost of product is $7, leaving me a $3 profit.

In my case, my actual costs in 2004 were only 37% of my sales, so I could afford to pay even more, but $2 target seems a good one for me to work with. Fortunately, it is easy for me to generate all leads I need for less than $2 each through various types of advertising available.