An increasing number of marketers are running strategic, relevantly targeted campaigns within e-newsletters -- with incredible results. Learn more about this tactic.
By now, everyone knows about the Microhoo saga. When Microsoft offered Yahoo $44.6 billion, Yahoo's board rejected the deal, claiming the bid substantially undervalues the company.
Yahoo's board may be right. When you look at the role Yahoo's advertising inventory would play in helping Microsoft finally reach a competitive level with the clear market leader, Google, the value of Yahoo may be worth much more than what Microsoft is offering.
Not surprisingly, a majority of Yahoo's inventory exists in email. According to a January report by adRelevance, 58 percent of ad inventory is typically found in or around the inbox.
Microsoft is no stranger to email, either, leveraging the channel as an advertising medium for everything from direct response to branding campaigns. A merger of Yahoo's email with Microsoft's Windows Hotmail Live would create an incredible opportunity for marketers across the board.
Unlocking the hidden value
According to Forrester, email marketing will be a $4B industry by 2011. As Anna Chernis, senior research manager with DMA stated in eMarketer on October 30, 2007, "Email produces the highest response rate for lead generation -- especially for house campaigns -- of direct mail methods we have studied."
Most advertisers think of email marketing as purely push tactics that can be added to other campaigns. But, an increasing number of strategists are realizing that running strategic, relevantly targeted campaigns within emails can drive tremendous benefit.
Inbox marketing campaigns have the benefit of being very cost effective, which in turn means strong ROI for performance marketers. Inbox ads are measurable, and unlike their other online cousins search and display, the underlying toolsets offer timely, real, data that inform better optimization because it is personalized optimization. It is this personalization that separates email from other marketing segments and makes it -- when well-executed -- a great branding vehicle.
With creative units that are similar to the branded web pages that consumers find familiar, inbox ads provide immediate, controlled brand recognition. Consumers value inbox ads from brands that they trust and most react positively knowing that the communication will contain new information and offers they are unable to receive elsewhere.
Inbox advertising networks are now creating the same media opportunities in their channel that companies like Advertising.com created in the display channel. How? By aggregating a significant amount of inbox ad inventory, opening it to a marketplace and serving the advertising intelligently. This media inventory is deep and rich. It has its own exchange. It can be targeted behaviorally and contextually. The underlying toolsets provide marketers with optimization and analytics.
How email is becoming an important part of the branding mix
Inbox marketing's benefits are illustrated by a case study from MSN UK, which used email newsletters to better develop its services to female subscribers interested in finance. The campaign illustrates not only high response rates and ROI, but also email's technological advancements, flexibility and branding ability.
Historically, consumer newsletters, done right, have been a great way for brands to stay in touch with their market segment. Creating and maintaining engaging e-newsletters represents a fraction of the cost of printing and production associated with direct mail while retaining all its advantages. E-newsletters offer consumers branded lifestyle or news content in a timely, direct way, while providing related contextual offers tailored to readership interest in an interactive medium. Subscribers receive consumer education, research, and advice, alongside contextual offers from relevant brands.
Advertising in e-newsletters with consumer trust and brand recognition should be an easy decision for savvy marketers. Using creative to brand and sponsor landing pages, e-newsletters often draw consumers directly to websites for immediate conversion. Because the newsletters are easy to forward, and the offers are unique, many e-newsletter campaigns receive the added benefit of a viral lift.
The benefits of inbox advertising to marketers are many. Participating brands can design their own ad creative and layout for the e-newsletter so brands have complete control over their image and branding while hitching a ride in a trusted consumer information source. Because e-newsletters can be tracked, brands are provided access to data on who is opening the e-newsletter and the offers within it. Brands can use this information to optimize their ads or change their campaign strategies based on direct consumer data.
Windows Live: Using e-newsletter service to drive advertising revenue
The Windows Live newsletter service touches on a variety of different interests from healthcare focused newsletters to newsletters with personal finance information. When MSN wanted to increase its female readership in the finance channel it used email to test demographics and interest level of its existing members.
The financial needs and planning methodologies of women beginning their careers is much different than financial strategies of women more established in their careers. By creating two different e-newsletters, one focused on women under 30 and one focused on women over 30, MSN UK saw a significant increase in clickthrough rates (CTR) for its Money Newsletter. By simply tailoring messaging to these different constituencies, the Money Newsletter received a total 113 percent lift in CTR.
MSN UK's study revealed that e-newsletters are good news for display advertisers seeking more inventory as well. Every page of an e-newsletter creates additional opportunities for display advertising. Brands know that consumers are more likely to respond to ads relevant to them and are more likely to convert when they receive offers relevant to what they are searching.
The MSN UK Money demographic study found that newsletters targeted by gender to specific consumer age groups received a much higher rate of unique page views thereby increasing opportunities for brands to reach consumers in a contextually relevant exchange. In fact, the under-30 age group in this study increased its unique page views in the targeted e-newsletter by an astonishing 493 percent.
E-newsletters -- when done correctly and with regularity -- reinforce brands very effectively. Targeted e-newsletters not only provide a higher quality publishing space for advertisers, e-newsletters generate additional display inventory on hosting networks. E-newsletter content matched with relevant ads has proven to drive immediate conversions and sales.
With inbox advertising supporting multiple performance models -- Cost Per Acquisition, Cost Per Lead, Cost Per Sale, Revenue Share, Cost Per Click, Cost Per Thousand -- all of which can be performance driven and each of which mitigates risk to brands and advertisers by making cost and ROI dependent growth, shouldn't the inbox be part of your branding strategy?
Sean O'Neal is chief revenue officer, Datran Media.