Forrester's Nail: Current E-Mail Practices Hitting Plateau

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NEW YORK -- Jim Nail, principal analyst at Forrester Research, looked to stir things up at Bigfoot Interactive's Profile E-Mail Summit yesterday.


He told the estimated 200 attendees, mostly clients of e-mail marketing firm Bigfoot, that it was time to change the rules of e-mail marketing as consumer resistance further constricted the growth of online databases.


"As it's practiced, e-mail marketing is reaching a plateau," Nail said.


Citing Forrester Research, he said 78 percent of online customers subscribe to at least one marketing e-mail, unchanged from 2003. The same data showed 86 percent of non-subscribers -- people who have never subscribed to an e-mail marketing program -- say they are unlikely to subscribe. And 45 percent of subscribers are uninterested in subscribing to more e-mail.


So, can marketers do something differently to add value to their e-mail? Also, can they move from mass marketing e-mails to targeted relevance?


Consumers feel the advertising overload, Nail said. Recent Forrester research shows that 70 percent to 80 percent of consumers say too many ads are out there. Sixty percent of the ads are not even relevant, according to consumer feedback.


Another issue for online marketers is the over-interpretation of permission. Nail calls it permission profligacy. He gave the audience his recent holiday experience with Neiman Marcus. After he ordered a pair of gloves online for his wife, Nail was bombarded with e-mails. He was upset.


"I'm an e-mail marketing pro," he said. "I didn't remember signing up for e-mails."


He urged Neiman Marcus to work with its e-mail marketing vendor, CheetahMail, to implement better practices.


At issue is the credibility of marketers.


"Consumers don't believe when you promise not to share their data: 77 percent don't believe it," Nail said, relying on Forrester data.


Marketers also need to move from the idea of campaigns -- an e-mail drop on the 10th of each month, for instance -- to conversations. Dialogues should be interest-based. Amazon was the poster child for such communications, he said.


Two other companies gained honorable mention. IntraWest, a hospitality firm running the Whistler resort in British Columbia, won Nail's admiration for its "Destination Countdown" e-mails. Three weeks before a ski trip, IntraWest triggers a series of e-mails, including confirmation of booking, checklist, appropriate apparel, upgrade offers for rooms, free ski lessons for children, rental gear and so on.


IntraWest's approach to e-mail paid off recently. Room upgrade revenue rose 20 percent, and ski rentals are up almost 25 percent. Ski lesson revenue climbed from $3 million a year to more than $20 million.


Auction site eBay has a similar interest-based attitude toward e-mail, as Nail found out. He hadn't visited the site in a long time, so eBay sent him an e-mail asking him what he was waiting for. The e-mail said here is how the user could search. Another e-mail involved the basics of eBay.


Nail then decided to sell an item on the site. But it didn't sell. So eBay sent him an e-mail with tips on selling. Another posting of the item failed to gain a buyer. This time another eBay e-mail offered him a relisting with certain conditions.


"EBay's saying that 'we're seeing what's working for you, what's not working for you, and we've got tips for your success,' " he said.


A final piece of advice he gave was to junk the traditional A/B testing mindset of offline marketing. Online, the potential to test e-mail copy, headline, art and offers is immense. But marketers are daunted by the options and test only sporadically.


Nail suggested experimental designing based on grids, strategically selected variables and modeling. He cited Optimost and Offermatica as companies with tools to help design the grids and select combinations of variables.


He wrapped up his presentation with three suggestions.


"Maybe stop thinking like marketers," he said. "Think like IntraWest. Adopt a proactive service mindset. Start to think about those personas and those purchase scenarios. How can e-mail support the consumer's goal? And test, test, test ... but be smart, smart, smart. Understand that the old techniques are not adequate."


Mickey Alam Khan covers Internet marketing campaigns and e-commerce, agency news as well as circulation for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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