E-mail marketing
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Email marketing is a form of direct marketing which uses electronic mail as a means of communicating commercial or fundraising messages to an audience. In its broadest sense, every email sent to a potential or current customer could be considered email marketing. However, the term is usually used to refer to:
- Sending emails with the purpose of enhancing the relationship of a merchant with its current or old customers and to encourage customer loyalty and repeat business.
- Sending emails with the purpose of acquiring new customers or convincing old customers to buy something immediately.
- Adding advertisements in emails sent by other companies to their customers.
- Emails that are being sent on the Internet (Email did and does exist outside the Internet, Network Email, FIDO etc.)
Researchers estimate that US firms alone spent $400 million on email marketing in 2006.[1]
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[edit] Advantages
Email marketing (on the Internet) is popular with companies because:
- The advantage of a mailing list is clearly the ability to distribute information to a wide range of specific, potential customers at a relatively low cost.
- Compared to other media investments such as direct mail or printed newsletters, it is less expensive.
- An exact Return on investment can be tracked ("track to basket") and has proven to be high when done properly. Email marketing is often reported as second only to search marketing as the most effective online marketing tactic.[2]
- It is instant, as opposed to a mailed advertisement, an email arrives in a few seconds or minutes.
- It lets the advertiser "push" the message to its audience, as opposed to a website that waits for customers to come in.
- It is easy to track. An advertiser can track users via web bugs, bounce messages, un-subscribes, read-receipts, click-throughs, etc. These can be used to measure open rates, positive or negative responses, correlate sales with marketing.
- Advertisers generate repeat business affordably and automatically
- Advertisers can reach substantial numbers of email subscribers who have opted in (consented) to receive email communications on subjects of interest to them
- Over half of Internet users check or send email on a typical day.[3]
- Specific types of interaction with messages can trigger other messages to be automatically delivered.
- Specific types of interaction with messages can trigger other events such as updating the profile of the recipient to indicate a specific interest category.
- Green - email marketing is paper-free
[edit] Disadvantages
Many companies use email marketing to communicate with existing customers, but many other companies send unsolicited bulk email, also known as spam.
Internet system administrators have always considered themselves responsible for dealing with "abuse of the net", but not "abuse on the net". That is, they will act quite vigorously against spam, but will leave issues like libel or trademark infringement to the courts. Most aministrators passionately hate spam, which they define as any unsolicited email. Draconian measures — such as taking down a corporate website with or without warning — are an entirely normal response to spamming. Typically, the "Terms of Service" in Internet companies' contracts allow this, so the spammer has no recourse.
Illicit email marketing antedates legitimate email marketing, since on the early Internet (see Arpanet) it was not permitted to use the medium for commercial purposes. As a result, marketers attempting to establish themselves as legitimate businesses in email marketing have had an uphill battle, hampered also by criminal spam operations billing themselves as legitimate.
It is frequently difficult for observers to distinguish between legitimate and spam email marketing. First off, spammers attempt to represent themselves as legitimate operators, obfuscating the issue. Second, direct-marketing political groups such as the U.S. Direct Marketing Association (DMA) have pressured legislatures to legalize activities which many Internet operators consider to be spamming, such as the sending of "opt-out" unsolicited commercial email. Third, the sheer volume of spam email has led some users to mistake legitimate commercial email (for instance, a mailing list to which the user subscribed) for spam — especially when the two have a similar appearance, as when messages include HTML and flashy graphics.
Due to the volume of spam email on the Internet, spam filters are essential to most users. Some marketers report that legitimate commercial emails frequently get caught by filters, and hidden; however, it is somewhat less common for email users to complain that spam filters block legitimate mail.
Companies considering an email marketing program must make sure that their program does not violate spam laws such as the United States' CAN-SPAM Act (Controlling the Assault of Non-Solicited Pornography and Marketing Act),[4] the European Privacy & Electronic Communications Regulations 2003 or their Internet provider's acceptable use policy. Even if a company follows the law, if Internet mail administrators find that it is sending spam it is likely to be listed in blacklists such as SPEWS.
[edit] CAN-SPAM compliance
Because the CAN-SPAM Act of 2003 authorizes a USD 11,000 penalty per violation for spamming each individual recipient, many commercial email marketers within the United States utilize a service or special software that helps ensure compliance with the Act. A variety of older systems exist which do not ensure compliance with the Act. To comply with the Act's regulation of commercial email, services typically: require users to authenticate their return address and include a valid physical address, provide a one-click unsubscribe feature, and prohibit importing lists of purchased addresses which may not have given valid permission.
In addition to satisfying legal requirements, service providers stepped in to help customers to set up and manage their own email marketing campaigns. The services provide email templates, automatically handle subscriptions and removals, and generate statistics on how many messages were received and opened, and whether the recipients clicked on any links within the messages.
[edit] Opt-in email advertising
Opt-in email advertising or permission marketing is a method of advertising via electronic mail whereby the recipient of the advertisement has consented to receive it. It is one of several ways developed by marketers to eliminate the disadvantages of email marketing.[5]
Email has become a very popular mode of communication across the world. It has also become extremely popular to advertise through. Some of the many advantages of advertising through email are the direct contact with the consumer and is “inexpensive, flexible, and simple to implement” (Fairhead, 2003). There are also disadvantages attached to email advertising such as, alienating the consumer because of overload to messages or the advertisement getting deleted without getting read.
Permission email marketing may evolve into a technology that uses a handshake protocol between sender and receiver (Fairhaed, 2003). This system is intended to eventually result in a high degree of satisfaction between consumers and marketers. If opt-in email advertising is used, the material that is emailed to consumers will be “anticipated.” It is assumed that the consumer wants to receive it, which makes it unlike unsolicited advertisements sent to the consumer (often referred to as spam). Ideally, opt-in email advertisements will be more personal and relevant to the consumer than untargetted advertisements.
A common example of permission marketing is a newsletter sent to a firm’s customers. Newsletters like this are a way to let customers know about upcoming events or promotions, or new products.[6] In this type of advertising, a company that wants to send a newsletter to their customers may ask them at the point of purchase if they would like to receive this newsletter.
With a foundation of opted-in contact information stored in a database, marketers can automatically send out promotional materials. The marketers can also segment their promotions to specific market segments.[7]
[edit] Terms
There are number of terms used in email marketing, marketers in this space have to be familiar with, to name a few: auto-responder, bounce message, click-through rate, double opt-in or opt-in, open rate and spam for example.[8]
[edit] References
- ^ DMA: "The Power of Direct Marketing: ROI, Sales, Expenditures and Employment in the U.S., 2006-2007 Edition", Direct Marketing Association, October 2006
- ^ Brownlow, M: "Why do email marketing?", Email Marketing Reports, June 2008
- ^ Pew Internet & American Life Project, "Tracking surveys", March 2000 – March 2007
- ^ The CAN-SPAM Act of 2003 online at ftc.gov or PDF Version
- ^ Fairhead, N. (2003) “All hail the brave new world of permission marketing via email” (Media 16, August 2003)
- ^ Dilworth, Dianna. (2007) Ruth's Chris Steak House sends sizzling e-mails for special occasions, DMNews retrieved on February 19, 2008
- ^ O'Brian J. & Montazemia, A. (2004) Management Information Systems (Canada: McGraw-Hill Ryerson Ltd.)
- ^ Marketing Sherpa (Jul 29, 2004), The Ultimate Email Glossary: 178 Common Terms Defined, Marketing Sherpa retrieved on September 4, 2007
