Ask any direct mail business owner where the money is and you will get the same answer. The money is in the list. The same holds true for home based internet businesses. The money is in the list.

The difficulty with building a quality list is it takes time and money. You can advertise on PPC search engines, conduct ezine ad campaigns, work joint ventures with other publishers and generally work yourself half to death trying to get potential subscribers to your free sign up page.

But what if there was a more profitable system that eliminated the freebie subscribers? What if you could generate a subscriber list that was made up of proven buyers from day 1? And each new subscriber paid you $1.17 to be on your list. That makes better business sense.

Sound like a pipe dream? It is not. It is a proven system that builds your list at the same time it adds a cash flow to your business.

The system works like this:

Potential subscribers are offered something of value for free. But instead of being the typical ebook or free report it is a product like an interview or PC video presented on a CD or DVD. The new subscriber is offered the CD for free if they pay the shipping and handling. In actual fact, the price of shipping and handling covers the cost to produce, package and ship the CD and leaves you with a profit.

Let us take a look at a real life example. To increase subscribers for my newsletter, I offered a 1 hour audio interview with Kacper Postawski, a niche marketing genius. The interview was valued at $97, but I offered it as a free CD if the new subscriber paid the postage and handling of $6.95.

Postage and handling charge $6.95credit card processing 0.38 (5.5%)credit card processor fee 0.45$4.95 CD duplication, packaging, and postage = $1.17 profit

This offer generated an average of 100 new subscribers per week with minimal promotion. It was a win/win situation. The new subscriber got a $97 product for free and I got paid $1.17 for each new subscriber to my list. If you really want to kick this system into high gear, put together a marketing campaign and watch your subscriber base build exponentially. Your bank account will thank you too.

Building a paid subscriber base can take longer than building a free database, but the quality is often much higher. Your list contains only customers, people who have already proven they are willing to whip out their credit cards and plunk some money online.

You could argue that the price is so low, they are almost free subscribers. The difference is, you know these people make purchases. You know what they are interested in so you can make back end sales by offering products that are in line with their interests.

Here is an example:

You offer your potential new subscriber a free CD about list building. The customer pays $6.95 for shipping and handling, which covers your costs and leaves you with $1.17 profit. You know the customer is interested in list building, so they probably have a business.

From here you can move in one of two directions. For your back end products, you could offer complimentary products that a business builder would need. You could offer marketing material, copywriting products, advertising guides, basically anything that a business owner could need to build their business.

The other direction you could move towards is selling more in depth material on list building. Here is an example of this path:

The next product you could offer them is a Manual and a CD for $47.

A natural progression could be an ecourse for $197. The course could lead to a List Building Power Pack that contains manuals, tutorials, DVDs and CDs for $997.

The Power Pack could lead to a seminar for $1,997, which could lead to a 1-on-1 coaching session for $5,000.

You could also combine the two marketing methods and offer your customer a combination of higher priced list building material as well as other business building products.

Ramping up your sales is normal business in the direct mail industry and it works online just as well.

The drawback to this kind of list building is it is not automated. It takes time to manage the database and the system. This is the kind of work that is best to be outsourced when your business gets big enough.

Building lists can be time consuming work, but it is time well spent. If you are paid $1.17 for each new subscriber, it can be profitable, even before you bring in your back end sales.