New Rules for Using E-Mail Correctly

The U.S. Department of Commerce reports online sales increased 29 percent in the first quarter of 2005 over the same period last year. As online commerce continues to grow, marketers need to begin operating by a new set of rules.

Research by Forrester found that consumers place more trust in Web sites and e-mails they signed up for than in newspaper, magazine, radio or television ads. To benefit from the trust consumers place in online communications, marketers must update practices covering how they build and manage lists, target customers and measure e-mail effectiveness.

Unfortunately, marketers too often fail to achieve the kind of one-to-one customer relationship possible with e-mail. Because e-mail is so much cheaper than more traditional channels, marketers and brand managers sometimes fail to recognize the strong revenue potential of e-mail campaigns. More importantly, they fail to realize the harm that can be done to their brand when e-mail marketing isn’t handled with thought and care.

Marketers benefit from adopting new rules to better manage e-mail campaigns. To solidify online relationships with customers, companies need to update practices covering how they build and manage lists, target customers and measure campaign effectiveness.

Building and managing lists. When building lists, remember that e-mail marketing works best in helping a company strengthen a relationship with a customer, not start one. Though it must be done with great care, companies starting to build lists should consider appending e-mail addresses to their offline customer lists.

Even more importantly, companies should add a prominent opt-in section to their Web site. Silverpop’s “Retail Email Marketing Study,” which reviewed the registration procedures, marketing messages and opt-out practices of 175 companies, found that 23 percent failed to include e-mail registration requests on the home page. Though home page property is extremely valuable, opt-in registrations should never be placed off-page.

If a company wants to gather prospects to its opt-in program, list rental is no longer a best practice. Look at co-branding instead. Begin by finding a respected Web site that reaches a target audience with high potential to show interest in your brand. Companies then can “co-register” new opt-ins alongside the Web site’s registration process. Companies also can tag along their own opt-in offer in the Web site’s regular e-mails to its list.

Reaching out to a “sister” brand’s customers helps create a transfer of trust to your brand and it avoids the spam stigma that can be associated with traditional list rentals.

Targeting. Traditionally, marketers thought that repetition and frequency drove awareness. But in e-mail, repetition and frequency can undermine response and damage your brand. JupiterResearch found that nearly one-fourth of permission e-mailers practice unsophisticated “batch and blast” campaigns.

Instead of asking how many times you can e-mail customers, focus on delivering relevant content. There’s no appropriate frequency for sending an 8-year-old child ads about low mortgages. But you can send 20 e-mails a month to mothers offering $100 off groceries and you won’t hear any complaints.

Lifecycle targeting has proven to boost e-mail campaign effectiveness and relevance. For example, in a lifecycle campaign you would send one type of message to a pregnant woman who signed up to receive information, then change the messaging after the baby is born and as the child ages.

Lifecycle targeting can produce extraordinary results. JupiterResearch found that triggered lifecycle marketing messages yield the highest conversion rates and, on average, generate five times more revenue than broadcast mailings.

Measuring success. Though traditional metrics like open rates, clicks and conversions still matter, marketers need to apply new rules to determine e-mail success. Whereas open rates traditionally reflected the response to the subject line, in the new world of e-mail marketing, they more likely reflect the impact of your brand.

Most recipients open e-mails based on who sent the message, not what the message is about. And that underscores the long-term effect of e-mail. It has the power to build trust and brand loyalty when done appropriately. Customer trust should never be squandered by slipshod practices.

E-mail marketing is returning to its roots as a true relationship tool. Successful companies will respect the customer loyalty inherent in the e-mail relationship by applying the new rules of list building and managing, targeting and measurement.

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