Study: Corporate E-Mail Marketing Not Keeping Pace With Customer Demands

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Permission-based e-mail programs are not sophisticated enough to meet the demands and preferences of the rapidly evolving online customer, according to a study by research firm IMT Strategies.

The survey of 300 online customers and more than 300 leading marketers was conducted in cooperation with the Direct Marketing Association and its subsidiary Association of Interactive Marketing. It found that U.S. corporations spent more than $1.4 billion with 200 e-mail services and services providers in 2000. For every dollar spent with outside vendors, $2 was spent on "hidden costs" associated with campaign management, content development, channel and permission policy governance and database management.

"The studies' findings show that most [corporations] are not moving up the e-mail 'learning curve' fast enough to keep up with their customers and best-in-class e-mail programs," the report warned. "For many, this e-mail competency gap will lead to diminished campaign performance, weaker online customer relationships and brand damage."

The report by the Stamford, CT, firm also stated that permission-based e-mail is particularly effective for customer retention, with average campaign conversion costs one-tenth that of direct mail on customer retention efforts. It noted that 60 percent of customers responded to commercial e-mail more than once if they had previously opted-in with the marketer.

"More than three-quarters of users delete unwanted e-mails without reading them, and they are taking control in other ways to avoid receiving more superfluous e-mail marketing," the study said. "Many marketing organizations have failed to put in place the most fundamental e-mail policies and proven campaign best practices. Customers reported that marketers still abuse the e-mail channel."

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