E-Mail Marketing's Future... Right Now

By Peter Prestipino, Editor-in-Chief and Mike Phillips, Senior Editor

Search engines drive website traffic; social networks promote brand awareness and blogs encourage community engagement. But what about e-mail? E-mail marketing drives results - in the form of traffic, awareness and engagement. And don't think for a moment that your top competitor doesn't realize its importance to their bottom line either.

Regardless of the size of your enterprise, email and e-mail marketing play integral roles in your success. But the shift toward e-mail as part of a broader marketing strategy is not a new one; rather, marketers are gaining a new focus. Those charged with Web success have always understood its importance to their bottom line - both quantitatively and qualitatively. Before social media darlings like Facebook and Twitter, and stalwarts like Google became forever intertwined with how we compete online, there was e-mail.
 

THE STATE OF E-MAIL TODAY

According to the June "2009 Marketing Trends Survey" by StrongMail Systems, 42 percent of nearly 1,000 global business leaders polled plan to increase their marketing budgets in 2009. Of those, 81 percent intend to increase their e-mail marketing spend. Spending on e-mail marketing, which has flowed seemingly unabated for years, shows no signs of slowing down - even as social networks and search engines continue to dominate the marketing headlines.

What makes e-mail so appealing to marketers? Unlike social media marketing where a monetary valuation is often arbitrarily placed on interactions with consumers, e-mail marketing is trackable. Its results are so obvious that e-mail marketers are more results-oriented and ultimately accountable for their performance. While social media certainly has its place in the Web marketing world, it has nothing on e-mail. And the proof is in the budget.

Spending on e-mail marketing will expand at double-digit rates for the next five years, according to a report from private equity firm Veronis Suhler Stevenson - expanding at 18.5 percent each year. So what's the reason for this continued growth? Perhaps because e-mail is less expensive or that it's incredibly effective but that doesn't tell the whole story. The reason e-mail is growing at such phenomenal rates is because consumers rely on it and e-mail marketing vendors are getting better at enabling Web professionals to use their services as integrated communication platforms. This intersection of consumer needs and marketer capabilities leads down one of the Web's shortest roads to success. But marketers need a navigator. That comes in the form of e-mail service provider (ESPs).

It is important to periodically address the essential criteria for selecting an ESP (those services that often support part of our overall marketing objectives) and discuss the future of the greatest marketing tool ever to influence consumers on the Web.


BASIC, YET ESSENTIAL ESP SELECTION CRITERIA
Success, whether on the Web or in the brick-and-mortar world, often depends on our individual ability to influence the final outcome. For this reason, starting a long-term outreach campaign that embraces and influences an audience that will ultimately purchase your products or services is imperative. Selecting an ESP that facilitates a proper list building initiative and eases management complexities and deliverability issues is perhaps the first and most important consideration you will make related to marketing with e-mail. But increasingly ESPs are offering so much more.

While the basic selection criteria detailed herein should act as a general guide, as the needs of every enterprise will be different, they are but a starting point. There are many more considerations to make; including how each vendor handles authentication (Sender ID, DKIM, SPF), quality control features, third-party integration and more. If vendors can't master the most basic features (which are often related directly to client usability), there is little chance they will be able to handle the greater challenges of marketing via e-mail.

RECIPIENT PRIORITY
Assessing an ESP's ability to foster an environment of permission-based marketing should always be a key criterion. The manner in which individual ESPs do this will vary but, in every case, service providers should enable the development of a subscription form, validate the accuracy of that information (through a double-opt-in process), and provide storage of that list. While this might seem obvious to many, there are vendors in the market that don't make these features a priority. Some leave the responsibility of best practices solely to the marketer. In those cases, poor deliverability or even worse, blacklisting, is what results when we approach e-mail marketing without essential tools and support. Subscription and customer management are important aspects of e-mail marketing success. Failure to follow established guidance in these regards often, results in poor response - something all marketers intend to avoid. When ESPs support the priority you place on recipients, a safer, more efficient e-mail marketing environment results.

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Deliverability Benchmark Data: Are your e-mails hitting the inbox? Web success with e-mail depends greatly on high rates of deliverability. Pivotal Veracity released its Retail-Industry Summer Deliverability Benchmark results in mid-September. How do you stack up with those in your industry and against all verticals? Merchants who primarily sell movies, books and music top the list of retailer deliverability, with an average 95 percent inbox rate. That's 18 percent higher than the combined average of all other industry sectors, tracked between June 1 and September 1, 2009.

REPORTING PRIORITY
Understanding performance on both a macro and micro level provides granular insights into not only the quality of a list, but the efficacy of your messaging and marketing strategy. Being able to access percampaign data on open rates, click-through rates and even deliverability inform marketers on what's working and what can be improved upon. Detailed reporting gives the ability to make adjustments when necessary or stay with the plan you have already developed. But it's not just the success metrics that should be scrutinized - failure metrics, such as the ability to track opt-out subscribers and SPAM complaints also yield insights into performance and can provide early warnings before poor performance strikes.

BASIC-FEATURE COMPLIANT
Many marketers have lofty expectations as to what they want to accomplish (typically asking for unique and esoteric features), but the majority still manage very simple campaigns. The presence of basic features, therefore, will prove to be another important criterion on which an ESP should be judged. The ability to quickly and correctly create individual e-mails and campaigns (facilitated perhaps by the presence of prestructured templates), to preview and test content and run SPAM checks, schedule delivery and set up autoresponders are basic yet very important tools for professional e-mail marketers.

If you are an in-house e-mail marketer or using a service provider that does not meet these most basic selection criteria, it's time to consider an alternate vendor.

ADVANCED-FEATURE FOCUSED AND FORWARD THINKING ESP
Perhaps most important, the ESP you choose must have an eye to the future. And much of e-mail's future is shaping up right now. It's very possible that many advanced and powerful technologies are already available to you. These might even prove to be elements that completely reshape your e-mail strategy. If your ESP is doing a poor job communicating new features and capabilities to you, call them out on it. And if you find that your ESP is woefully behind in the innovation department, or not paying attention to future e-mail user needs and trends, it's time to move on.

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RSS MEETS E-MAIL: On-demand e-mail marketing software Gold Lasso recently completed the development of a feature that allows its eLoop users to create e-mail messages and campaigns based on RSS feeds. Users merge content from RSS feeds into their messages and set campaigns to automatically execute when the feeds are updated. "A large portion of e-mail marketing budgets and time are spent performing message assembly and managing content," says Elie D. Asher, president, Gold Lasso. "The answer to help unwind some of the vagaries of message assembly is incorporating RSS feeds into e-mail messages. This is useful for people using Twitter, publishers who update their sites regularly and have newsletters based on updates, press releases, or any other type of timely content that gets posted to a website regularly."

THE FUTURE OF E-MAIL MARKETING ... IS NOW
It's challenging to forecast what's upcoming for e-mail marketing - but it's also quite revealing.

Website Magazine spoke with many of the industry's thought leaders on the future of e-mail marketing and their insights show that, as it stands today, marketers have a whole host of opportunities at their disposal right now. Making a commitment to use what's available is another matter entirely.

Segmentation (the ability to create smaller, customized sub-lists from a larger master file) has been available to marketers for many years but is only beginning to gain traction. "The majority of our customers have an understanding that they want to segment," says Derek Harding, CEO, Innovyx Inc. "What slows down that advancement is that many marketing departments are short-term focused or event driven and, as a result, don't have an overall complete view of their customer or what kind of communication they want for them."

Those who recognize the value proposition in segmentation reap the benefits. For example, one large, multi-national Innovyx client has been running a dynamic newsletter for four years and actively uses segmentation. This has enabled them to go beyond what one might expect. By tapping into consumer behavior on the site and through previous e-mails, the client was able to make a more informed decision as to what content appeared in that dynamic newsletter. And, in one instance, created more than 933 segments - in seven different languages. While that was the most segmentation that Harding has seen, it does show the potential, and how targeted e-mail can become.

Maximizing list value will also be a focus of e-mail marketing moving forward. "Marketers will get more involved with engagement by determining their subscriber/recipients levels of activity or inactivity," says Ross Kramer, CEO, Listrak. "The result is they will start to speak differently to their customers. As the market matures, it's about getting more out of what you already have - more water out of the sponge."

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E-MAIL FOR USERS AND MARKETERS: SenderOK, a startup division of Web CEO, has a handy e-mail plugin that works in Outlook, Gmail, Live and Yahoo!. The plugin puts social network profiles into the header panel of messages, sorts e-mail according to past behavior toward the sender (including whether the user visited the sender's website recently), places corporate favicons in the inbox when an e-mail has been authenticated by the user (anti-phishing icons) and ensures authenticated e-mail stays out of the spam box.

All ESPs provide tracking tools, but industry leaders such as Listrak, iContact, ExactTarget and many others enable marketers to take existing metrics such as open and click-through rates, and see which recipients don't take action. By segmenting a list of those inactive recipients, marketers can "power reengagement," Kramer says.

At last year's Listrak conference, Kramer promised to make engagement metrics front and center and its spring release did just that. "Implementing engagement makes sure you're not over-mailing [or risking alienation] and speaking more directly to those that aren't that engaged," Kramer adds.

Many expect that in the future, e-mail marketers will start to wrap their collective heads around abandonment and what they can do about it. For example, Listrak is using SeeWhy in its newlyreleased Conductor, an event-triggered system that makes running abandonment programs easier and more effective. Working with SeeWhy allows marketers to add a string of JavaScript to a page and send a custom message to the user when abandonment occurs.

If merchants can look directly into the activity on their shopping cart, they will see a lot of consumers leaving. Solutions such as SeeWhy - with which many ESPs are now partnering - have yielded some positive results. For example, one merchant had 2,500 abandonments, of which Listrak brought back 55 orders. That's significant recouped revenue.

Another interesting trend is the coupling of e-mail with other technologies. One example is combining e-mail with customer relationship management (CRM) - something that is provided by ExactTarget with its integration of SalesForce.com and Microsoft Dynamics CRM. Most businesses are tasked with staying connected to users during lengthy buying cycles. "By coupling e-mail with CRM, clients can automate email to provide information that is relevant to the needs and preferences of the IT decision maker," says Joel Book, director of eMarketing education, ExactTarget.

Integrating with third-party systems does not stop at CRM. E-mail vendors routinely provide integration with analytics vendors too. Coupling with a company like Omniture enables ExactTarget clients to understand the unique needs of their customers while delivering information that aids in the decision-making process.

Coupling e-mail with social media is perhaps the most forward-facing and public integration. Social media marketing is hot and most people are interested in finding out how to leverage these networking websites to attract more consumers to their brand. "When you have the ability to forward e-mail to friends and colleagues and direct them to your social media site, you have a huge multiplying effect on your message," Book says.

Smart brands are now empowering their e-mail subscribers (their brand advocates) to forward messages to their friends who might be interested in the product or offer, through their preferred social network. ExactTarget recently partnered with ShareThis to provide such a capability called SocialForward.

These are not just theories and case studies, they are real world examples where this can be seen working successfully. DreamFields Pasta is the perfect example. At last count it built a marketing database in excess of 280,000 brand advocates in a span of 24 months. And those advocates are actively sharing brand information with their friends. The more we empower our consumers to take charge of the message and disseminate it to the people important to them, the more that email marketing becomes a pull proposition. "As much as we like to think we control the message, it's really the customer," Book adds.

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E-Mail Forever: E-mail marketing service provider MailChimp made its service pretty much irresistible in September as the company announced the introduction of its Forever Free pricing plan. The new service level allows subscribers to send up to 500 e-mails per campaign and 3,000 e-mails per month at no cost. "We're aiming to empower smaller groups like artists, musicians, non-profits, small businesses and hand-crafters to communicate effectively at no cost," says Ben Chestnut, co-founder, MailChimp. "That's why we're calling this 'Power to the People.' We want to give everyone all the tools they need to send professional, permission-based e-mail campaigns."

E-MAIL STILL MATTERS
In Website Magazine's February 2006 cover story "Emailology - A Best Practice Guide for E-mail," we postulated that e-mail marketers in the future would increasingly be driven by a need to deliver the right promotion to the right consumer at the right time. For many, that forecast has come true. But much work still needs to be done. It's clear that personalization (whether basic or more advanced) is more approachable now than it was back in February 2006, but we've ultimately failed, thanks to the complexity associated with segmentation - which can drive both revenue and response to entirely new and more productive and lucrative levels.

Over the next few years, know that a deeper level of integration will occur with existing software solutions, most will become increasingly familiar with and in tune with the needs of their consumers. And e-mail, with all its complexities and challenges, will remain a key to your Web success.