Despite the fact that email marketing enjoys one of the highest ROIs in the world of marketing, recent research suggests that there is still far more room for improvement. In fact, data provided by eMarketer in its report, "E-Mail Marketing: How to Improve ROI," indicate 31 percent of CMOs say email and regular mail offer the greatest ROI -- better than events, PR, website interactive programs and advertising both online and offline.
Email is one of the most cost-effective marketing channels around these days. But with email volume in the United States alone expected to reach more than 2.6 trillion messages in 2007, email marketers must broaden their focus beyond single campaign ROI numbers towards creating campaigns that truly engage customers over the lifetime of their relationship.
First, it's important to recognize that in today's highly overflowing inbox, it's no longer sufficient to simply obtain permission. Customers must now not only sign up to receive emails from you, they must anticipate them. That's right. Your goal should be that customers get a little shiver of delight when they see your company or brand name in the "from" field. Consumer focus has shifted from the subject line to the from field, and studies now show half of all users open emails because of the sender. This change in behavior underscores the importance of developing what I call "Email Brand Value." Marketers' emphasis should move from one-time email success to building up the brand over a series of email campaigns that make customers actually anticipate hearing from you.
Keep in mind that you're walking a tightrope with email users. While 45 percent say that email is a great tool for companies to keep customers informed, nine out of 10 Americans also say they want control over who puts stuff in their inboxes. And that protective bent isn't due solely to the nefarious activities of spammers. While eMarketer's research report shows that 55 percent of companies think their biggest challenge with email is spam, 44 percent are more correct in believing the biggest challenge is providing relevant content.
While spam has caused some concern among email users, it's creating less consternation than it has in the past. Last year, 62 percent of respondents in a study reported in eMarketer said they trust email less because of spam. This year that number dropped to 52 percent. People adjust. They delete. They get on with their lives. But for the email marketer, the real cost of spam is the increased need to be relevant to each individual recipient, with every campaign you send.
Nearly half (46 percent) of internet users say commercial emails they receive are not targeted to their needs, so it's clear the industry has a long way to go to improve email campaigns. But it can be done. Silverpop has many customers who regularly offer targeted, highly relevant communications to customers. And their brands benefit tremendously as a result. These savvy marketers recognize that it is simply no longer adequate to receive permission from customers. Now you must be engaged with your customers. You must be more relevant and more targeted than the dozen or so other emails your customer may have signed up for. You're not just going up against your competitors' email programs -- you're going up against everybody who wants your customer's attention via the inbox.
To truly achieve engagement with customers, most companies will need to take their email campaigns to a higher level. Tailoring messages to meet the needs of a targeted audience requires segmenting mailing lists and testing various offers, formats and timing. While direct marketers test to cut the cost of campaigns, email marketers test to make their campaigns more relevant and improve brand loyalty.
Dynamic content, behavior targeting, life cycle automation and deep analytics all are elements of a truly interactive and well-conceived campaign. Combining the best of personalization with technology, advanced emailers treat each outgoing message as a unique opportunity to speak directly to an individual. Advanced use of dynamic content fills in sections of a message depending on the recipient's interests. So, for example, the diet center sends emails with low-carb recipes to the dieters who are willing to forgo buns with their hamburgers and sends low-fat recipes to those opting for a more traditional weight-loss plan. Each customer receives a highly customized -- therefore highly relevant -- message.
Many companies are getting better at providing relevance. eMarketer's report found that 57 percent of internet users now say emails they receive are more targeted than those they got last year. Some companies have been ahead of the game for some time now. Their email campaigns don't operate on the assumption that every one of the company's customers wants to receive an email about every product they sell. Rather, they ask their customers what they want to learn more about and how frequently they want to receive messages. Abiding to customers' preferences regarding what they receive and when, marketers give the customers the control they seek. With only half of marketers doing targeted campaigns, this is an area rich with possibilities for marketers.
Relevance is at the heart of many of the questions my colleagues and I get every day. For example, many of the questions are about frequency. How many times can I get away with emailing to my house list? The answer, of course, is -- "It depends." For example, an airline can send frequent fliers free upgrade coupons every day for a month and it's doubtful they'd be flagged as spammers. But sending a nine-year old information on low mortgages twice in the same time period would not only run the risk of having your entire mailing blocked because of spam complaints, you wouldn't exactly be nurturing customer relationships.
Time and again, we've seen companies dramatically increase their online revenue by offering targeted, relevant content over the email channel. Utilizing the same kinds of segmentation and targeting tools that our direct mail colleagues use, email marketers can achieve a much finer degree of targeting and do it faster and at lesser cost. Don't waste the opportunity to engage in a truly win-win communications program with your customers. Take your email campaigns to the next level.
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Bill Nussey is the president and CEO of Silverpop. Under his leadership, Silverpop helps marketers cultivate and maintain long-term strategic relationships with customers by maximizing the potential of email as a relationship tool. The company differentiates itself through strong technology, strategic services and the industry's most flexible service model. In late 2004, JupiterResearch ranked Silverpop #1 in nearly every category of its annual review of email service providers.