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Epsilon: Gmail Tabs Are Bad News for Marketers

Click rates on marketing emails delivered through Gmail dipped below Yahoo’s in both August and October, the first time Gmail has surrendered its number one position for click percentage in at least five years, according to a study released yesterday by Epsilon.

The reason: marketing emails left languishing unopened—or opened after the promotion had ended—in Gmail Promotions tabs.

“There are two types of people,” says Quinn Jalli, SVP of Epsilon’s Strategic Initiatives Group, “people who don’t open emails religiously and people who are oblivious to the advent of Gmail Tabs and are wondering where their promotional emails went.”

Because email opens traditionally plummet during summer months, Jalli’s group tracked some 5.6 billion emails sent by 60 clients through Gmail, Hotmail, and Yahoo from June through October. Before the full rollout of Tabs in June, Gmail posted a 4.6% click rate to Yahoo’s 4%. By the end of July, Gmail was only one tenth of a percentage point ahead of Yahoo and then fell slightly behind the email volume leader in August. When open activity returned to normal levels in October, Gmail’s click rate still trailed Yahoo’s, 3.3% to 3.4%.

“We don’t believe that this is going to ruin Gmail as a marketing medium, but it’s clearly going to affect drive-to-site capabilities of emails,” Jalli says. “Lower clicks always mean lower revenues. If clicks drop 10%, revenues drop 10%.”

At the same time, marketing email opens are up by at least 10% on mobile devices, Jalli says, a development that presents both an opportunity and a challenge to marketers since mobile clicks trail desktop clicks by about a third.

“Marketers are going to have to address this situation by revising their marketing strategies around mobile,” Jalli says. “They should absolutely be looking at mobile email optimization and click-to-purchase options in situations where there’s a banking connection with customers.”

Interestingly, Hotmail bested both its rivals for percentage of opens in Epsilon’s study, which points out that open numbers may be misleading because iPhones now render all images by default and fire more pixels denoting opens.

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