Show Consumers E-Mail's BenefitsToday's merchants tend to think of e-mail marketing the way merchants of old regarded uncharted waters: There's the promise of strong trade winds and distant markets, but also the peril of treacherous storms. The scary weather, in this case, is whipped up by consumer and media concerns over how this new marketing technique will affect their lives.
To survive, e-mail marketers need a rare but important trait: responsiveness. They must be able to listen and respond to the demands of ever-more-powerful consumers. And increasingly, what consumers are demanding is a clear understanding of what's being done with their e-mail and personal data.
Consumers want to know what they are sacrificing in turning over this data; in that respect, most merchants are doing a decent job. More importantly, though, consumers want to know what they are gaining from the deal. That's where e-mail and Web marketers are allowing the ship to sink.
There is a lot more at stake than the survival of a few marketers. If we do not respond to consumer demands, the industry could lose e-mail as a marketing tool -- and more importantly, as a customer loyalty and retention tool -- squandering its most exciting and far-reaching resource for customer relationship management. This is a blockade that none of us can afford.
Privacy Fears Are Paramount
Fueled by headlines and political grandstanding, fears about privacy soon could lead to restrictive regulations on e-mail marketing. Such restrictions could seriously harm customer relationships and the bottom lines of retailers. Naturally, marketers should keep abreast of the status of pending state and federal legislation surrounding these issues, but they also must look deeper to understand the foundation for the concerns: irresponsible and uncaring use of data -- meaning a lack of clear notice and choice for consumers.
Already, e-mail has become the medium of choice for marketers to gain the attention of Internet users who are indifferent or impervious to other forms of advertising.
A recent report by Jupiter Communications, New York, projects that commercial e-mail spending will soar from $164 million in 1999 to $7.3 billion in 2005. Furthermore, the report states that e-mail is a cost-effective and high-response way to acquire and retain consumers, sell and promote products, drive loyalty and reinforce branding efforts.
E-mail is becoming so indispensable that smart marketers are considering how they can change their methods to fall in line with consumer desires and to ensure that the value of e-mail marketing is preserved. If you want to be marketing with e-mail five years from now, you have to work hard to earn consumers' trust.
As you tell consumers how you plan to use their data, clearly spell out the benefits to the consumer, instead of assuming they are aware of them. Fortunately, recent news provides many helpful illustrations of how
e-mail personalizes the shopping experience and makes it fun and rewarding.
Customers of online digital music providers, for example, can now get "single-serving" MP3 music e-mails directly from the record labels, based on the music preferences submitted by the customer. Do you love punk music? E-mails can let you sample releases from the hottest new bands, while telling you when the band will be playing at your local microbrewery.
In another interesting twist, major retail chains are sending discount store coupons by e-mail to elated customers who volunteered their e-mail data and who are spending twice as much during their coupon visits as other customers. All kinds of retailers are matching up customized customer product preferences with changing inventory and are sending e-mails with digital photos whenever the requested products come in. Need replacement pieces for your antique crystal stemware? A photo e-mail will be on the way as soon as the pattern comes into stock. Looking for a 1911 first edition of "Treasure Island" illustrated by N.C. Wyeth? E-mail will keep you connected to this free, quick and easy flow of information.
All marketers have a story like this to tell to consumers. So tell your story. Your customers will be excited to have this kind of personalized service.
Don't Ask a Fork to Do a Spoon's Job
Marketers should use e-mail the way it was intended to be used, rather than turning it into a nuisance. Instead of broadcasting ad messages in hopes of tripping over viable customers, marketers should use e-mail primarily to help form one-on-one relationships through newsletters, interactive product forums, Web-based "wish lists" and the like. Research strongly supports this position.
It is also important to ask your customers how often they wish to be contacted. E-mail marketers and opt-in list providers often overlook this question. But by asking this simple question, marketers will be honoring consumer preferences.
According to Jupiter, 68 percent of e-mail consumers who have already had contact with a company want to receive promotions and offers from the company by e-mail, and 47 percent want site and product information from those companies. However, consumers clearly lack interest in receiving promotions and offers from companies with which they have not had previous contact, the data found. Only 14 percent of respondents to the Jupiter consumer survey indicated an interest in receiving such material.
Luckily, many companies are catching on to the proper use of e-mail. A Jupiter executive survey indicates that 61 percent of e-commerce companies are using e-mail to deepen their relationship with customers. But 46 percent said they are using e-mail to acquire new customers, a use that sometimes cuts against consumer desires.
Here's the crux: E-mail marketers should always obtain permission from consumers before including them in newsletter distribution lists, renting their names to others or including them in full-scale e-mail sales campaigns. And if the consumers already have a relationship with the company, permission means sending an introductory message that offers a clear, easy chance to opt out of future e-mails.
There's a really good reason for this: Direct mail has clearly taught us as marketers that we should not want to send "junk" messages to unreceptive consumers. It costs too much and angers the very people we are trying to befriend. A smart first move is to send an e-mail to existing customers asking them if they would like to be marketed to by e-mail. A prominent opt-out choice in the e-mail makes sure that there are no misunderstandings.
But the opt-out provision should not end with the first e-mail message. Rather, it should be a permanent feature of the e-mail campaign, included in every message sent to the consumer -- even if the relationship began with an opt-in election. Further, marketers should offer this choice for every product that they promote to the consumer by e-mail. If, for example, the marketer sends both coupon offers and an information newsletter by e-mail, they should offer opt-outs for both. The same principle applies when a marketer is promoting two different retail stores under the same ownership.
Ultimately, growing pressure for change from consumers and the government will weed out companies conducting irresponsible e-mail marketing campaigns. The only marketers to succeed will be the ones responsibly listening to consumer needs and fears, clearly explaining the consumer benefits of e-mail and delivering e-mail messages that are truly in the consumer's best interest.
• Drew May is a business unit leader at Acxiom Corp., Little Rock, AR. Reach him at Dmay@acxiom.com.