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Successful e-Mail Marketing Practices
Bagus Nurcahyo, Dr.
Programme of Study of Marketing ManagementUndergraduate Programme of Business &
EntrepreneurshipGunadarma University
Managing e-Mail Marketing
• Defining e-Mail Marketing Objectives • Determining Communication Strategies• Reaching your Target Audience• Designing e-Mail Creative • Evaluating Results • Selecting a Solution• Final Recommendations
Common Objectives
• Acquire new leads/ registrants/ customers/ clients• Drive immediate sales• Enhance customer retention programs• Build stronger relationships with existing
customers/clients• Provide company or product information• Increase revenues by up-selling to existing
customers/clients• Post-order targeted e-mails• Build brand awareness• As part of an integrated marketing strategy• Increase web site traffic
Response Rates by Campaign Objective
15.30%
15.20%
17.10%
7.90%
5.60%
6.80%
Leads
Sales
Awareness
ConversionCTR
Source: IMT Strategies, September 2001
Acquisition versus retention
Acquisition Retention
Search engine positioning 94% 6%
Banner ads 91% 9%
Referral/viral programs 85% 15%
Affiliate programs/ sponsorships 75% 25%
Incentive programs 51% 49%
E-Mail Marketing 37% 63%
Source: DMA- April, 2002
Sales Conversion Costs
Acquisition Retention
E-mail $57.10 $2.50
Direct Mail $25.00 $60.00
Banner ads $140.00 N/A
Source: IMT Strategies, September 2001
Popular e-Mail models
• Discount sales promotions • Sales transaction confirmations• Account statements • Scheduled corporate newsletters• Press release list• News alerts from Media outlets • Time-based reminders• E-mail discussion groups/ communities• Product announcements• Entertainment (humor, film clips)• Online education courses • Product user/support groups • Auto-responders
Average CTR for B2C and B2B e-mail newsletters
3.40%
2.80%
1.90%
0.90%
0.50%
0.30%
0% 2% 4%
2000
2001
2002
B2CB2B
Source: Opt-in News, May 2002
• Specials/offers from online merchants• Specials/offers from local retailers or restaurants• Household tips/recipes/crafts• Humor• Travel• Entertainment• Weather• Local news• Tech/business news• Finance/stock information• Sports
Top Interests for Permission e-Mail Users in the US
Top reasons why US Internet users respond to e-mail offers
• Know and trust brand• Relevant information• Friend has recommended• Price/coupon/reward• Timely• Compelling subject• Entertaining
Viral Marketing: Types of messages that are forwarded
• Merchandise deals and promotions• Prize/coupon/reward• Social/political messages and petitions • Warnings and advisories • High level of relevance• Funny• Work related• Informative• Cool• New Technology
How US internet users learn about new web sites
Source: IMT Strategies, Sept. 2001
19%
22%
48%
56%
59%
80%
0% 20% 40% 60% 80% 100%
Radio
Guess URL
Television
Viral Marketing
Link from other site
Search engines
US Internet User Attitude towards e-Mail Volume, 2001
49%
3%
34%
15%
0% 20% 40% 60%
Just right
Somewhatmore
Too many
Cannothandle
Source: IMT Strategies, September 2001
E-mail overload: Number of e-mail marketing e-mail sent in the US
939
796
674
549
430
289
0 500 1000
2006
2005
2004
2003
2002
2001
Source: Forrester Research, August 2001
Response to permission e-mail versus unknown senders
52%
21%
15%
12%
1%
3%
6%
29%
49%
13%
0% 20% 40% 60%
Delete
Open but annoyed
Indifferent
Curious to read
Eager to read
Unknown senders Permission e-mail
Opt-in, opt-out, double opt-in, spam: Preferred e-mail marketing
methods
64%
31%
4%
1%
Double Opt-I nOpt-inOpt-outSpam
Source: Opt-In News, May 2002
Rates for US e-mail permission-based marketing campaigns
2.10%
7.80%
7.00%
17.80%
0% 5% 10% 15% 20%
Unsubscribe
Bounce
Netconversion
Click-through
Source: IMT Strategies, Sept. 2001
Permission e-mail marketing vs. direct mail retention costs
Cost per thousand (CPM)
Click-Through Rates(CTR)
Conversion Rate
Cost per sale
E-mail to in-house list
$5 15% 3.7% $1
Direct Mail to in-house list
$761 N/A 3.9% $20
Source: Forrester Research, August 2001
Building your permission-based lists
• Subscriber form on web site• Sponsor lists of sites with a similar demographic• Send to a friend button – viral marketing• Ask for permission to customer base• Maintain list hygiene• E-mail appending…
Building Customer Intelligence
• Harness your Customer Database• Evaluate Customer Behavior• Effective personalization and targeting• Common Segmentation Factors:
o Purchase historyo Location/zip codeo Demographicso Lifestyle/hobbies/interestso Psychographics
US Internet Users’ Level of Concern Regarding Online Privacy
71.30%
61.70%
23.10%
29.50%
5.50%
8.80%
2001
2000NotconcernedSomewhatconcernedExtremelyconcerned
Source: UCLA Center for Communication Policy, November 2001
US Consumers’ Privacy concerns
69%
70%
75%
66% 68% 70% 72% 74% 76%
Hackers willsteal info
Transactionsnot secure
Sharing infowith third
parties
Source: Harris Interactive, February 2002
US E-Mail users’ preferred e-mail marketing privacy and customer-
support practices
• Unsubscribe option in all e-mails• Explicit no-share-address policy• 48-hour e-mail support answers• Editable personal preferences page• Provide phone numbers in e-mail• Explicit privacy policy• Double opt-in confirmation• Unchecked default opt-in box• Third-party privacy seal in e-mail
Most Important e-Mail Marketing trust-building factors among US users
• Secure sign-up form• Trustworthy reputation• Loyal customer• Well-known brand• Friend recommendation• Trusted site referral• Relevant offers
Why customers would give personal info
• Guarantee that the information will not be misused• Eligibility to win a prize in a sweepstakes• Regular e-mail updates for products of their interest• Access to more or better content or information• Affinity points• Receive targeted ads they’re likely to be interested in
Privacy & Regulations
• HIPPA covers health personal information• COPPA protects children• Gramm-Leach Bliley Act concerns financial information• FTC supports Corporate Privacy Policies• Federal spam regulation does not exist• State laws exists in 13 US states, including California,
Colorado, etc.• More information about spam regulations visit:
www.spamlaws.com
E-Mail Message Content
• Subject Line – getting recipients to open mail is half the battle
• Creativity• Personality and dynamic content• Keep it short and use links to draw reader to your web
site• Keep it fresh – don’t re-use the same content• Relevance – the more you understand your customers,
the more targeted and relevant messages will be• Frequency• Test messages
Email users’ preferred e-mail marketing personalization models
• Communication Control: Digests, Frequency• Self-select content• Name recognition• Personal events & reminders• Geographic relevance• Account History• Recognizing Lifestyle Preferences• Purchasing Behavior
Preferred e-mail advertisement formats worldwide, Q1 2002
35%
62%
3%
HTMLTextRich Media
Source: Opt-IN News, May 2002
Response rates per format
1.20%
7.40%
9.00%
18.50%
3.20%
7.70%
5.30%
15.60%
0.00%
5.00%
10.00%
15.00%
20.00%
Unsubscribe
Bounce
Conversion
Click-Through
HTMLText
Source: IMT Strategies, Sept. 2001
How to measure the effectiveness of e-mail marketing campaigns
• Click-through rates o unique and sum of events & comparisons
• Unsubscribe rates• Open rates• Conversion rates (website tracking)• Click-stream analyses• E-mail pass along rates –viral marketing• Coupon codes• Anonymous tracking to respect privacy• Campaign Comparison Reporting
Response time and cost per unit, e-mail vs. direct mail
• Be prepared to handle responses
E-Mail Direct Mail
Response Time 3 days 3-6 weeks
Cost per unit $0.25 $1.25
Source: DMA, Forrester Research, Gartner Group, 2002
Maintain your server• Hardware/computer
network• Dedicated Internet
Connection• Software for e-mail
management and delivery• Best for large loads and
those with experience• More cost-effective/
economies of scale• Flexibility to create
campaigns on the fly
Outsource your list hosting• Reliability and experience• Redundant servers and
delivery capacity• Flexibility to maintain
company Internet presence• Ability to move from
hosting to in-house when ready
• More expensive• Rely on company’s
schedule
Outsourced e-Mail Marketing Services
8%
28%
0%
2%
22%
68%
10%
8%
0% 20% 40% 60% 80%
Analysis
Delivery
Creative
Strategy
20012003
Source: Forrester Research, August 2001
Evaluating Options
• Evaluate software product or hosting service before purchasing
• Determine if solution provides appropriate features• Decide what reporting features you need
o online real-time reporting, compatibility with other software you employ
• Differentiating levels of privacy tracking• Campaign manager to organize jobs• Integration with your database and other applications• Handle bounces
Main Recommendations
• Integrate e-mail into your integrated marketing communication plan
• E-Mail marketing is best used for retention and other customer permission-based communications
• Offering sales promotions is the most successful strategy
• Consider double opt-in and build your permission-based lists
• Respect recipients’ privacy to earn their trust• Personalize messages to provide relevant information
which will increase response rates• Evaluate options and opt for time-tested solutions
Bagus Nurcahyo,Dr. Programme of Study of Marketing Management,Undergraduate Programme of Business & Entrepreneurship,Gunadarma University,Margonda Raya St. No. 100, Pondok Cina, Depok,Phone: 021-78881112 ext 456Mobile: 08161112590Official site: http://bagus.gunadarma.ac.idWeb Blog: http://gus-nur69.wordpress.comE-mail: [email protected]