Understanding e-mail marketing

In this two-part series, Don Lange, SVP, Cornerstone Group of Companies, examines the ins and outs of e-mail marketing. Join him next month when he covers the execution and measurement of e-mail marketing campaigns....

In this two-part series, Don Lange, SVP, Cornerstone Group of Companies, examines the ins and outs of e-mail marketing. Join him next month when he covers the execution and measurement of e-mail marketing campaigns.

Broadcast e-mail marketing – whether for prospecting, publishing or retention purposes – requires careful preparation and knowledge of the issues that can mean the difference between a successful and unsuccessful campaign. For too long, e-mail marketing has been approached without strong, fundamental direct marketing principals. Dot-com companies that assumed their Web sites would work like flypaper have not taken the steps to truly build on the continuity of relationship that is the offspring of database marketing.

At first, traditional companies were attracted to the dot-com phenomena and bought into sloppy prospecting, acquisition and retention strategies on their own sites or in their own campaigns. Luckily, direct marketers have prevailed over internal Web divisions and, backed with both on-line experience and DM savvy, are looking at the jugular issues that are unique to all marketing campaigns combined with the uniqueness of e-mail marketing, including:

* Choosing the right e-mail lists.

* Database management techniques.

* Creative: What works and what doesn’t.

* Preparation for the blast.

* Execution.

* Post-campaign analysis.

* Top factors in choosing e-mail lists.

The most important factor in choosing e-mail lists is the privacy issue. Make sure that the list owner has provided a legitimate opt-out or opt-in to the people on the list.

The other equally important factor is the availability of land addresses attached to the records. If you don’t have land addresses, then you are facing all sorts of issues, including:

* The inability to accurately suppress your own customer list.

* The inability to accurately remove duplications within the list and with any other lists you are e-mailing.

* The inability to do any geographical segmentation (this means you might get orders from people in areas you don’t fulfill).

* The inability to do any personalization without first and last names.

Finally, you should be dealing with a list broker who understands the entire list business, not just the e-mail list business.

Types of e-mail lists

There are different kinds of e-mail lists available. The most common are:

* Newsletter ride-alongs: Where you are able to include a few lines of text and a link on an existing newsletter. These generally have very poor response because your offer is buried within too much other information. Unless the newsletter is extremely vertical, you can expect click-throughs to be marginally better than banner ads, which, at last glance, were nearly extinct.

* Contest or survey lists: Where the names have been generated through a Web-based contest that creates lists by asking a few interest questions. These lists are better than ride-alongs, but not as effective as the next category.

* Customer lists: Where names have been generated as a by-product of a business, such as magazine subscribers or product buyers. These are generally the best lists because the people have demonstrated an interest or activity through a purchase of some sort. Most lists like this have co-branded messaging from the list owners, and they may not always approve your offer unless it has specific relevance to their customers.

* B2B lists: Where names are directory sourced.

These lists have strong segmentation, which improves targeting, but you need to be wary of the opt-out messaging.

Whether executing a business-to-business campaign or a consumer campaign, the e-mail marketer should remember that the recipient views the e-mail as a personal message, and thus the issue of privacy is key.

Database management

The point of an e-mail campaign should not be to generate traffic on a Web site – the point should be to sell a product or service. This means, in most cases, that you will need land addresses to fulfill orders. Database management is one of the most important steps in the campaign process. When planning a campaign, you should work closely with a service provider that has a thorough knowledge and understanding of databases, as well as the necessary tools and experience for both cleansing and segmentation purposes. These include:

* Address accuracy: The land addresses are as important as the e-mail addresses. Records should be corrected and standardized as per Canada Post guidelines.

* National change of address: An e-mail database with land addresses needs to be run through Canada Post and proprietary NCOA programs to ensure that the addresses are up-to-date. Is the accuracy of land addresses related to the accuracy of e-mail addresses? Yes, mostly because large providers are beginning to hit new movers hard with the opportunity to sign onto their service (which means a new e-mail address).

* Merge purge: E-mail campaigns that employ the same strategy for both acquisition and retention are bound to fail. Prospecting campaigns should not contain customer addresses. The most effective way to ensure this is to employ professional merge purge techniques using land addresses in the matchcode. With merge purge, you can control such segmentation as gender and number of e-mails per company or household. If you try to use just the e-mail as your matchcode, then you will miss duplicates because many people have more than one e-mail address.

* Business-to-business broadcasts: Be especially wary with B2B e-mailings, as many business lists consist of general e-mail boxes addressed to webmaster@, info@, and so on. You need to tell your database management/broadcast house how many e-mails per company you will allow. And, if you do allow more than one e-mail to go to a business address, then be absolutely certain that the e-mails are personalized with names so they can be routed properly. As a rule of thumb, keep your B2B e-mails to a limit of two per company when faced with general e-mail boxes for house mailings and only one per company for prospect campaigns.

* Consumer e-mails: Merge purge will capture duplications of households and individuals. If you are uncertain if there is duplication of individuals (for example, where there may only be initials available in the first name field), always use the one per household rule. Again, this is because many consumers have multiple e-mail addresses.

Next issue’s installment will explore creativity, blast-off and effective analysis of results.

Don Lange is SVP of the Cornerstone Group of Companies. He is responsible for Cornerstone Web Media, Canada’s first full-service provider of prospecting solutions on the Internet.

Creative

It is tempting to take advantage of the full array of technical products that the e-mail or Web environment can offer. However, it is also important to consider your audience and the technical capabilities of the e-mail application that receives your message:

* Text only: There are several e-mail boxes that can only support text. Therefore, it is very important that you have a text version of your creative if you are unable to predetermine the support capabilities of the recipient. Even in a hand-raising environment where people have stated that they can support HTML, it is best to use a broadcaster whose system can detect and deliver the right format.

* AOL (America Online): AOL e-mail addresses require a specific format. Make sure your broadcaster can support this requirement.

* HTML: HTML formats are the most effective. However, if too many images or graphics are attached to the e-mail, it may take too long to load and you try the patience of the recipient.

* Flash, streaming video, and the like: Despite the obvious appeal of preparing e-mails with rich visual displays, there are many people who do not have the capability to view these messages. Including a download application, such as ‘install Macromedia’ is not a solution, as you are then asking the customer to do too much. Direct marketers understand you don’t want to ask the prospect to do too much to respond. The focus has to be on the offer and responding has to be simple.

* Personalization: Like any form of direct response, e-mails that specifically address the recipients are the most effective. Broadcast software can create personalization in a letter format and throughout the message.

* Testing: Most effective broadcast applications can insert variables, both text and graphics, within a message. Combine this with land addresses and a solid database management company, and direct marketers can employ any number of testing techniques, from pricing, A/B, creative and more.

Preparing for blast-off

Once you have the messaging in place, there are several aspects of the e-mail that you can control in a house mailing and with some list rentals:

* The ‘from’ box: If you are prospecting to a third-party consumer list, it is likely that the list owner would control the ‘from’ box. However, if you have the option, you need to decide if you want the ‘from’ box coming from your company name or from a person’s name. A person’s name is more personal – however, it may not be received well when it becomes apparent that it is an advertising message. If you already enjoy a relationship with the recipients, then use a person’s name and cover off the point of the message in the subject field.

* The subject field: Avoid gimmicky slogans. Address the nature of the e-mail as fully as possible while limiting to less than 10 words – the fewer the better.

* The ‘reply to’ box: If you can host the reply box, do it. There are lots of reasons. The most important reason is that it is instinctive for many recipients to click ‘reply,’ even if there is a clear hotlink or submit form in the e-mail. Replies will consist of positive feedback (including orders), as well as negative feedback, so get ready for customer service issues that can take many forms.

* The opt-out message: Always include an opt-out – no exceptions. The best opt-out messages are clear and are in the form of a link. Putting the opt-out in a reply format leaves margins for error.

Once you have completed the database management, finalized the creative and decided on testing and the fundamental components of the e-mail, you are ready to execute the broadcast.

Blast-off

* Bad times for broadcasting: There are a few rules of thumb for the best time to send a broadcast. Most are intuitive, such as never send a business-to-business late in the day or first thing in the morning. Business people tend to review their e-mails right away in the morning – which is good. However, if they have many e-mails, they also tend to eliminate anything that is not directly related to their job – which is bad. The same business-to-business rules apply to such things as anytime after 2 p.m. on a Friday afternoon or any anytime Friday afternoon in the summer.

* Good times for broadcasting: For business-to-business, the best time seems to be around the lunch hour, when people are perhaps eating at their desk and have the opportunity to review links and offers. For consumers, click-to’s occur throughout the night and, in some cases, peak between 11 p.m. and 6 a.m. However, the best time to send an e-mail to consumers is weeknights between 6 p.m. and 7 p.m.

Measurement

There are several different ways to measure the effectiveness of an e-mail campaign:

* Delivery rate: Your broadcaster will be able to tell you exactly how many records were delivered successfully.

* Bad records: If you have a large number of undeliverables, it is likely you are using an out-of-date list.

* Click-to rates: Refers to the number of clicks on your links. This is kind of nice to know to see how many people are kicking your tires.

* Gross response: The total number of people who fill in your forms and order your product or service.

* Net response: The number of people who pay for your product or service. Let’s face it; this is the only measurement that counts.

You should also implement the same kind of projection tools that more sophisticated list brokers can bring to the table.

If all of these ideas sound very familiar to direct marketers, with a few new twists, they should. E-mail marketing is new, and some of the rules are different. However, many of the rules that we all use in executing a successful direct response campaign remain the same.

Don Lange is SVP of the Cornerstone Group of Companies. He is responsible for Cornerstone Web Media, Canada’s first full-service provider of prospecting solutions on the Internet.