Don’t Take the Bait- Buying Email Lists is Bad Business

(The following is based on an interview with Patrick Knight, Director of Client Deliverability for mobileStorm.)

In the world of email, bought lists are pretty common. Buying a list is not against the law per se(CAN-SPAM never specifically states it); however it’s not such a safe bet since it’s not necessarily clear how these lists are compiled. In many cases they contain addresses that were collected by third-parties who use pre-checkboxes, `and or contain harvested, spam traps (old addresses used to monitor and identify spam activity) and invalid addresses (addresses that are no longer active and bounce).

Contrary to what many marketers think, purchasing lists is not very cost effective, when you consider the facts. Anywhere from 80-90% of these lists have data that is useless. Not to mention the costs marketers incur by having to resolve issues as a result of using these lists.

There is never a time when you should send messaging to people who didn’t opt in. The question to ask your self is …Did these people request to be on my list? Do they expect to receive emails from you, have you sent emails to these people before. The main point here is consent. These people did not give you permission to send them messages.

Those marketers who do buy lists run serious risks. Beside the fact these people never sign up to receive your messages, even if you were to perform a permission pass campaign you run the risk of hitting spam traps, and in the end, it’s just not worth the risk.

A sender’s reputation is based on measuring many variables including, spam trap hits, number of complaints, and invalid addresses. As mentioned, many of these lists contain addresses that affect these variables negatively which can hinder if not ruin a good senders reputation.

Ultimately, good senders can end up being listed by major blacklists. IP addresses used to send messages in some cases can be permanently blocked. Furthermore, subscribers who have given permission to receive messages will most likely not receive it because of blocks place on your IP.

It may also take a significant amount of time and resources to repair your reputation. If utilizing an ESP this can also cause collateral damage to your provider.

Improve Your Email Marketing Through Segmentation

Published on March 24, 2009

Not all customers are alike, and what appeals to one may not interest another. Therefore, it is important that you connect the message you are sending to your customers' differing interests.
Email messages that are segmented, targeted, and relevant to the recipient are much more likely to be opened and acted upon.

Every small business can segment its customer base at some basic level. The following are some examples:

A sporting goods store emails information to its customers who have purchased bikes to inform them of new arrivals, while sending an "end of the ski season" blowout special to customers who have purchased ski equipment.

A garden center sends out a "Planting for Spring" promotion to gardening customers and a "Flowers for all Occasions" promotion to cut-flower and bouquet buyers.

A landscaping company sends out a promotion to past customers about keeping up their landscaping activities as well as its new services, while sending out a different appeal to prospects and builders.

A pub/restaurant sends out an email about an upcoming food pairing/tasting event to wine enthusiasts and an email about seasonal brews and pitcher specials for beer lovers.

Otherwise, the wine lover might get turned off by the beer promotion, and vice versa... but tap the right customer's passion and need at the right time—with a targeted subject line and content—and you're much more likely to create a sale.

Segmentation—Getting Started
Creating different email messages for different groups is a bit more work, but it's worth the extra effort when an email message hits your customer's sweet spot.

Your general e-newsletter may appeal to most customers, but mailings that reach out to your audience segments can build even deeper relationships, and drive more sales.
Consider these simple tips to be more successful with your segmentation:

1. Start with the first touch point
The best time to collect information for segmenting purposes is right when your prospect or customer joins your email list. You can easily create segmented lists by offering options with checkboxes on your sign-up form.
2. Ask for personal information
Ask for information such as location and personal preference to determine what's relevant to the person signing up. For example, a retailer might ask whether someone prefers to shop online or in the store. That way, the retailer can create two separate lists and send email coupons that contain an online promotion to one list and an in-store promotion to the other list.
3. Use online surveys
In your email newsletters, include a link to a short survey and ask for noncritical information that helps you add your people to the appropriate segmented lists. Once you have the survey results, you can create new lists or add to existing ones based on how respondents answered questions.
4. Use tracking reports
If you are using a professional email service that provides campaign-tracking reports, let the links that people click on help you understand them better. Your tracking reports make it easy for you to add anyone who clicks on a link to an existing list or a new list.
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Remember that there is a real person on the other end of each email address. Every time you create an email, ask yourself whether your email content is addressing the specific needs of your audience, or whether you're only addressing the needs of your business. Segmenting your list will set you up to do both effectively.

Direct Marketing as a Branding Tool

Every now and then I see an article in DMNews that challenges conventional marketing values. Such an article was co-authored in the February 23rd 2009 issue by Daniel Morel, CEO of Wunderman and John Gerzema, Chief Insights Officer, Young & Rubicam.
What drew me into the article was its title: "Branding and response are the same."
Well now, for many marketers -- in particular brand marketers -- those are fighting words.
The article compares the economic meltdown with another crisis.

"We discovered the value that brands bring to a company's total business value are exaggerated. The financial markets attach more value to brands' worth when compared to the consumers who buy the brands ascribe."

They go on to name it the "brand bubble" that is twice the ascribed value of the entire sub prime mortgage market.

Their impressive research data show that "85% of brands are stagnant or eroding in brand differentiation." And of Interbrands top 100 valuable brands from 2004 through 2007, 45% are declining in consumer perceptions.

The most interesting part of this article was how the authors combined the two different disciplines of branding and direct marketing into a single strategy.

As marketers, many of us bought into the AIDA model of awareness, interest, desire and then action. So branding pushed the demand and direct marketing harvested the desire branding developed into a purchase action.

The authors contend that this linear model no longer works.
In other words, AIDA now occurs during the direct marketing messaging because consumers now act immediately to brand/direct response messages. "Direct response no longer exists at the end of the tunnel."

Direct marketing actually creates the messaging and imagery that contribute to the brand as it always has. Only now, the Internet has given direct response new influence in the marketing community. The Internet and it's live interactivity gave direct response its ultimate medium.

Now most marketing activities are driven by CRM (Customer Relationship Marketing) and response.

In a very real sense, strong direct marketing programs have created the advertiser's reputation and product sell simultaneously from the beginning. But few in those early days were willing to ascribe that kind of mission to direct marketers.

Besides, branding is much bigger than brand advertising or direct marketing.
It is the culmination of the advertisers complete interaction with customers including customer service, phone answering systems, product quality, product warranties, market reputation and finally consistent positioning messages.

Direct marketing reveals much more about a company's true operating procedures and customer friendliness than a brand campaign.

Direct marketing includes offers, warranty information, shipping costs, refund policies, attitudes in the inbound and outbound telemarketing calls, email communications and so forth. All of these actions build or weaken brands. So direct marketing strategies go far beyond pure messaging.

Direct marketing interweaves with the advertiser's delivery of the brand on the ground where all of the action is.

In this new Internet world, companies like Zappos "created an Internet juggernaut with a call center and great product diversity that was at the heart of the brand." Several other examples are enumerated in the article.

The bottom line: direct marketing not only represents a potent branding tool, but it moves product all in a single integrated marketing strategy.

How important do you see direct marketing as a player in the brand arena? Does this article go too far?

Nielsen: Social Nets Overtake E-mail

As online paradigm shifts, advertisers must find a way to add value, rather than follow the 'push' model
March 9, 2009
-By Brian Morrissey

NEW YORK Social networking has overtaken e-mail as the most popular Internet activity, according to a new study released by Nielsen. Active reach in what Nielsen defines as "member communities" now exceeds e-mail participation by 67 percent to 65 percent. What's more, the reach of social networking and blogging venues is growing at twice the rate of other large drivers of Internet use such as portals, e-mail and search. Nielsen, which is the parent company of Adweek, concluded that the shift to social activity online would have profound effects on marketers and publishers. For publishers, social networks are eating into time spent with other online activities, according to Nielsen.
For advertisers, the phenomenon at this stage represents mostly unfulfilled promise for a deeper connection with consumers who are more difficult to reach in social environments. The rise of social media coincides with the decline of portals. Social networking appears to be snatching away users' online time formerly spent with e-mail, traditionally a large draw to portals. Such fragmentation is decreasing portals' importance to advertisers. In a separate report, top digital shop Razorfish said its spending at portals declined from 24 percent in 2006 to 16 percent in 2008. Nielsen found that two-thirds of the world's Internet users visited a social networking site in 2008. All told, social media now accounts for almost 10 percent of Internet time. Facebook is leading the pack worldwide, with monthly visits by three out of 10 Internet users in nine global markets, per Nielsen. The growth in social media is not confined to the U.S. Nielsen charted comparable or higher growth for Australia, Spain, Italy and the United Kingdom. Yet for now, user growth at social sites is outpacing advertising increases, per Nielsen. This will likely change, Nielsen said, as models shift to value engagement over exposure. "As the online industry matures and the value of online real estate is increasingly measured by time spent, rather than pages viewed, a significant shift in advertising revenue from 'traditional' online media towards social media could be realized -- if the successful ad model can be found," the report stated. The search for a workable ad model is even more urgent now that social media has broken out of the youth demographic, Nielsen found. For example, Facebook's greatest growth has come from 35-49-year-olds, and it has added twice as many 50-64-year-olds as those under 18. Yet advertising and social media to date have mixed like oil and water. Part of that is a function of social media's communications role -- advertising has typically performed poorly in chat and e-mail. The larger challenge for advertising is to move from an interruptive role to joining conversations. That means advertisers need to find ways to add value to users' experiences, Nielsen found. "Whatever the successful ad model turns out to be, the messaging will have to be authentic and humble, and built on the principle of two-way conversation -- not a push model -- that adds value to the consumer," the report said.

Use Email Campaigns To Generate More Email Campaigns–And Conversions

March12th, 2009 by eydie

Some marketers have only recently realized the importance of email. Others think it’s old hat. But true forward-thinkers are already taking their campaigns to the next level.
A business blogger at the Sydney Morning Herald points out a particular email discussion that happened at the Adtech conference held in Sydney this week, regarding “trigger-based” messages. Trigger-based email is sent according to a consumer’s particular behavior or preferences. For example, in an emailed company newsletter, there might be a link about a particular product. When the reader clicks on that link, this then triggers another email sent to the customer, offering a special sales offer regarding that product. Such links don’t have to be about a company’s product; a consumer’s birthday or purchasing preferences are other types of triggers.
Trigger-based messages, then, ensure that a brand remains engaged with and relevant to consumers by giving them important updates. The Herald blog points to HSBC Bank in Australia, which used trigger-based email marketing “to keep consumers engaged and informed” during their loan application process. This was done because many loan applicants shop around with several banks, and HSBC did not want them to go elsewhere for their loans. The upshot? HSBC Bank saw an approximately 65 percent improvement in acceptance of home loans.
Think of trigger-based email as the master’s degree after getting a bachelor degree in email marketing: The rules of email marketing best practices must foremost be understood and used. The customer must be the one to subscribe to get email messages, and the company must explain what to expect in these messages–as well as how often to expect them. As always, relevance is the key–if you start sending messages of the type that were not expected, the consumer might ignore your email and/or cancel the subscription.
Of course, trigger-based messaging can only work if the marketer really knows the customer. So it’s important to use an email-sending platform that will gather certain information, both demographic and “psychographic,” into a user-friendly database. Once such a database is compiled, the marketer can start creating triggers based on consumers’ preferences and personal profiles. (And maybe this database creation can be accelerated by using a product-click triggered email campaign first.)
Clearly, marketers who aren’t yet in email had better get cracking. Their competitors have already mastered the basics!