List building is a term used by internet marketers and the like to describe the act of building a list of people who are interested in the products or services you have to offer.
These people will then become a part of your "sell to" group and that is where the term "the money is in the list" comes from. The more people you have on your list, the more money you will essentially make.
Now a lot of people are not sure how this process works, so I will break it down for you. Firstly, a person is sent to your website. This can be done through advertising and marketing, search and content results, or they may have found a backlink to your site on an article, blog or forum. When they get to your site, they see all that you have to offer. Assuming that you have products for sale whether they are digital or physical, they might have a look around and then they will either purchase something or they will not, but once they leave, they are usually gone forever.
Now, have you ever been to a site that says any of the following: Provide your email to receive this free e book, join our free newsletter, enter your email to go through to our free members area or anything similar. Well, chances are, if you have ever input your email information then you have just joined someone else's list.
This time, when you decide to leave their site, they still have your contact information and can slowly build a relationship with you. In turn, you will build trust and reputation with the site owner and in time probably purchase from them in the future.
Most people are put into the list through a site opt in page or other wise known as a squeeze page. A page that is usually devoid of distraction and where the only task is for the person to input their details for some reward.
Most people do not manually organize their own lists, but use services such as Aweber and Get Response. These are automatic email response services and they allow you to type one email and have it sent to your entire list of people at a nominated date and time. These emails will usually have a link to a website or product and this is how the money is made. The people who have earlier entered their details are now considered subscribers and as they did come to your site in the first place and opted in to the products or services you were offering, they are considered a target buyer. As a result, they are more likely to be interested in the products you are selling and promoting and as they are gaining trust and familiarity with you, will be highly likely to purchase from you.
This is a very basic guide for those who are unaware of what a list is and how they work. There are many products and services that can easily help you build a list and monetize your website. These help take a lot of the hard work and frustration out of list building. Building a list is certainly essential to every solid online business, but it need not become a nightmare.