E-mail Marketing 101

Written by Jennifer Anderson

At first glance, e-mail marketing seems like an electronic version of direct mail. While there are parallels in terminology and strategy, there are also some key differences between the two. For instance, right out of the box, cost and reach will vary dramatically.

Cost and reach

Direct mail is expensive on a per-piece basis, largely because of postage costs. Blanketing a zip code can easily run into the thousands of dollars. In contrast, e-mail is virtually free. However, when you send direct mail by address block, you know you’ve reached every address available in that location – not so with e-mail. There is currently no way to cover a geographic area in any consistent way.

This means that reach isn’t defined by the “where” so much as the “who.” Instead of thinking in terms of raw numbers, a good e-mail marketing campaign thinks in terms of the person who will receive the e-mail. How the e-mail addresses are collected becomes very important. The quality of the contact matters.

Old style versus new style

When e-mail was a relatively new marketing opportunity, it was rather like handing out flyers on a busy street. Anyone and everyone got a cheap-to-produce, short and punchy, one-size-fits-all piece of paper. And just like those flyers, almost all of them ended up in the trash. But no matter… as long as you handed out enough inexpensive flyers, you got some response and a decent ROI.

In the online world, the process involves getting as many e-mail addresses as possible and mass-mailing to all of them. We now refer to this as spam, but for a while, it was a good method. In fact, it was good enough to spawn a few online services who collected e-mail addresses in bulk and offered to blanket their lists with unwanted inbox litter.

Spam filters were the first step Internet Service Providers (ISPs) took to combat this flood of junk. Their customers rightly reacted negatively to the sudden flood of “junk mail.” And this is a key difference between e-mail marketing and direct mail marketing: postal workers are not allowed to pre-screen mail before delivery; ISPs do it routinely with e-mail.

Filtering is a valuable service for consumers. They appreciate not having to look at and delete dozens of “pick me!” e-mails every time they check their inbox. So ISPs looked for ways to improve their filtering. They continue to do so. For instance, whole domains may be blocked if they have been blacklisted. Feedback from users who mark e-mails as spam keeps the lists current.

On top of this, the latest iteration is to filter e-mails, not just when users say they are spam, but when they act as if they are spam. So a few of your e-mails that are deleted without getting read or generating a click might trigger filtering even when a user doesn’t specifically say they should be.

Using "the list” is increasingly more important in order to avoid a campaign that will backfire. It’s now a matter of pre-filtering your contacts to get that segment of people who are likely interested in what you offer. The best scenario is attracting a site visitor who requests an e-mail from you, and then sending follow-up e-mails that do not trigger the “spam” identification feature.

The balance of quality

An ideal situation for ISP customers would be always getting only those e-mails they want. This isn’t possible, but the balance between filtering too much and not filtering enough is the goal.

From a marketers’ standpoint, we want to reach as many people as possible while maintaining the value we offer to those people. The technical term is “engagement.” This starts even before an e-mail is opened. Do they recognize the sender’s address? Does the title of the e-mail encourage them to open it? The unfortunate truth is that most e-mail marketing material is deleted before it is even viewed.

How much of a problem is this? Well, estimates tell us that 90% of all sent e-mail is labeled “unsolicited commercial e-mail,” or spam. Using Hotmail as one example, that means 5.5 billion e-mails a month are blocked before even reaching consumers, and another 1 billion are sent through but then marked as junk by users.

How do we respond to this new reality?

• Opt out vs. opt in – The difference is where the decision point happens. If a consumer is automatically enrolled in something and has to take action to withdraw, that’s an opt out. Conversely, if they have to approve their participation in something ahead of time, that’s an opt in. Opt out triggers the spam filter much more than opt in, so opt out is now seen as bordering on unethical.
• Scrubbing – List scrubbing means dropping those addresses that do not give you a response. You can identify them as those addresses with no clicks from the e-mails directly or no visits generated by those e-mails. One reason that websites use e-mails as usernames is to track site visits against their e-mail lists and connect the two so an e-mail contact list can be kept current.
• Raising engagement standards – The critical difference between "spam" and "not spam" is subjective. The closer we match e-mails to what customers actually want, the better. This is reflected in quicker initial contact and value.
• Using multiple threads of contact – It has been shown that those who participate in social media are more likely to use e-mail more “loosely.” In other words, they are less conservative about filtering and more likely to be intrigued by an e-mail offering. This is no different than the type of person who will pick up and read sale papers as opposed to someone who consider them a nuisance. Identifying the former is possible on the Internet.
• Leveraging the human connection – The ideal e-mail marketing campaign is a dialogue with possible customers. Exchanging their e-mail address for something of value is a start, but the “conversation” needs to continue as a back-and-forth relationship. Using polls, special offers and substantive news maintains a tone of a valuable connection instead of in-your-face marketing. E-mails that are personal, friendly, and worthwhile always move to the head of the pack.

The bottom line in an e-mail marketing campaign is that there are many ways to screw up and irritate people on your list. Great care is needed in growing and maintaining a quality connection.