HP happy with e-newsletter contribution

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Hewlett-Packard Co. is claiming success in its ongoing campaign to increase customer satisfaction and per-buyer sales through the use of personalized e-mail newsletters.

The 4.5 million opt-in subscribers to HP's targeted newsletters are as much as five times more likely to click through to the company's Web site than are recipients of HP's generic, one-off e-mail alerts. Collectively, the former group spends about $60 million a month at, said Stephanie Acker-Moy, VP-Internet and marketing services for HP's e-business, customer and sales operations unit.

Newsletter content comes from freelance writers, HP employees, analysts and publications (used with permission). The newsletters typically include a call to action, such as a product promotion, upcoming product-related event, a case study, a news-oriented commentary (HP's view on utility computing, for instance) or information tied to a subscriber's interest (such as early information about an HP server under development). The e-mails can also deliver driver alerts, software paths or firmware updates. Digital Impact, an e-mail marketing company, distributes the 5.6 million e-mails, which go out monthly or biweekly.

When the e-mail newsletter program was launched in 2001, Acker-Moy began offering newsletters that were personalized based on broad buyer profiles created by site visitors. Subscription totals numbered in the tens of thousands at that point.

At the end of the first year of the program, HP executives reviewed how well the program had met its goals and were satisfied enough to spend more money on making newsletters more customizable. The annual reviews continue-with the same result. (Acker-Moy declined to give a spending figure for the program.)

With every renewal of support and funding, Acker-Moy has been able to expand the personalization capabilities of the newsletters.

HP newsletter subscription pages are lengthy pick lists. A tenet of the program is that personalization increases a newsletter's relevance to its readers, which, in turn, results in more and greater purchases.

"Now, we have almost infinite possibilities," she said. Average revenue per individual buyer-not from whole accounts-tripled from 2002 to 2005, which Acker-Moy attributes to more effective, relevant content and better offers-offers based on deep knowledge of each buyer. Subscriber churn averages 30% annually, which is consistent with industry business-subscriber averages, according to HP.

Along with individual customi- zation, the program is growing in other ways, too. A year ago, HP began offering to its largest corporate customers a customized newsletter service that offers a targeted subset of all personalization choices. Options are germane to the subscribing company's business, presenting employees with a narrower menu of topics.

HP's newsletters also have taken on a cost-avoidance role by including high-level product-support and advisory content along with marketing messages. That content initially saved $100,000 per month for the call-center operation, and now saves around $400,000 per month, Acker-Moy said, largely because there are more subscribers to the newsletters and the advisory content has improved.

Acker-Moy said executives considering similar initiatives to perfect three facets of e-newsletters: content development and tagging (so that the system serves up the right content for subscribers); customer-profile management; and a newsletter-generation infrastructure that can marry the two.

Beyond that, she said, there are two secrets to getting an ROI. First, grow these e-mail newsletter programs iteratively; second, intently watch metrics and make an ROI case before expanding the program or adding new features.

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