To take the pulse of the industry, BtoB's East Coast Bureau Chief Christopher Hosford contacted experts to solicit their views on trends in e-mail marketing and the forces of change wrought on it by trends in customer preferences, social media marketing, automation and other emerging factors. Participating in the virtual roundtable were Matt Blumberg, chairman-CEO, Return Path; Christopher Parkin, senior director-genesis solutions, Adobe Inc.; Karen Talavera, president, Synchronicity Marketing; Paul Teshima, senior VP-customer strategy and success, Eloqua; and Bertrand Van Overschelde, regional manager-North America, Emailvision.
BtoB: E-mail marketing these days seems almost like a legacy channel, it's been around so long. Where is e-mail marketing today, and where is it heading?
Blumberg: E-mail is quite a big business, and there are a couple of reasons why it's booming. First, it works; it's the proven workhorse for customer communications, although not necessarily for customer solicitation. E-mail is still the only marketing channel that has customers raising their hands, saying “Please send me your information.”
Talavera: I agree. It's not that e-mail is changing technically so much as it's changing in the willingness of recipients to engage with this channel. There is the perception of trusting the e-mail channel, a preference for it and a willingness to interact with it. The good news for marketers is that the people who do want to hear from companies really want to opt in; they want to be proactive about it. When that happens, it's extremely effective.
Parkin: But it's also gotten to the point where e-mail and marketing automation must be joined. For example, e-mail success traditionally is measured by opens and clicks, but that's insufficient. You want a prospect to go to a Web or landing page to take some action, but e-mail marketers typically are not well connected with the Web side of the house to know what people do once they arrive there. Some will demonstrate desirable behaviors onsite ... others will start a lead form or begin to download a white paper but, for some reason, abandon the process. Today, we can pass that segment of people back to the e-mail service provider to re-engage with them to get them back in the funnel.
Teshima: The day when you sent out an e-mail with the primary purpose being that recipients would read the whole thing and digest your message ... those days are going away. Today, e-mail is just a way to say, “Hey, we're here again, and we'd just like to share something with you.”
That's not to say that e-newsletters aren't valuable, but it's more about giving somebody a sound bite in an e-mail to drive them to a richer experience on the Web.
BtoB: How are marketers responding to this?
Parkin: This year, people will receive 5,000 opted-in e-mails into their inboxes from vendors of all sizes and shapes. That will increase to north of 9,000 per person by 2013, so there's a lot of noise out there.
The smartest e-mail marketers are going to more of a Wii method, like Nintendo's interactive video game console. By this, I mean, it's all a matter of relevance and trying to achieve a level of conversation with your end recipients. And to be a great conversationalist, you have to be a good listener.
Van Overschelde: In the U.S., we notice that marketers are aware of proper segmentation and one-to-one marketing, but it remains a principle that most marketers ignore. Just geo-targeting your e-mail list can raise open rates to 30%—up from just 15%—and click rates to 6% or 7%, up from only 4%.
Talavera: Yes, even with a small group of engaged people, it can pay off because the cost of entry is practically zero. It's all about the quality of the people who are getting the messages. In the end, all the quantity in the world won't be effective.
BtoB: Bertrand, Emailvision is a Paris-based company and is relatively new to the U.S. What international trends are you seeing?
Van Overschelde: The trends internationally are different depending on the development of the Internet in different countries. The Netherlands, Canada or Sweden, for example, are very developed with Internet penetration of 90% to 95%. In the U.K., Germany and France, it's around 80% to 85%, while in Brazil, Spain and Italy the rate of penetration is about 50% to 55%. So the use of e-mail list segmentation is much higher and more sophisticated in countries where the penetration of Internet connectivity is higher.
I also notice a difference in open rates, which has to be taken into consideration. For example, Belgium has both Dutch- and French-speaking populations, but the Dutch speakers have open rates of about 25% compared with the French speakers, at about 18%. We actually see open rates going down globally, while click rates are steady. People still buy when they want to buy.
BtoB: How are other channels, such as social media and mobile marketing, impacting e-mail?
Talavera: There is a ton of synergy, and I delight that the channels are coming together. Some of it is about devices and that people want to do everything from everywhere. Marketers have to realize that computing habits are changing: Some people want messages in their e-mail inboxes; some want them on Facebook; others on mobile; and still others in their postal mailboxes. The question for marketers is do you know how your target market wants to hear from you? Knowing this can extend the marketing reach into as many channels of choice as possible.
Teshima: Social media also provides the e-mail marketer with feedback loops on his campaigns. For example, you may see large spikes of complaints. That almost always gets back to the quality of your database—that you're just blasting e-mails to an improper list. Or it may be a particular campaign that's generating the complaints. We have actually fired customers who we felt violated end-user guidelines.
BtoB: Speaking of complaints, deliverability is always of concern to e-mail marketers. What's happening on this front?
Teshima: Four years ago, when Dennis Dayman first came aboard as Eloqua's chief privacy and deliverability officer, he really opened our eyes about this. There are two things going on here: what to do by law and then what actually impacts your ability to make a successful e-mail campaign.
People are good about opt outs, CAN-SPAM and so forth; but the truth is that deliverability issues occur when recipients complain. Mentally, there are some people who feel they shouldn't be receiving your e-mail, even if they opted in 30 days before. The important thing is to only send things to people who are interested in your stuff. Use their activity, history, past purchases and the like as proxies for determining the best people to send e-mails to. That will reduce complaints.
Blumberg: I think that sophisticated mailers really do understand that deliverability is something worth paying attention to. The ones who do it right pull a handful of important deliverability metrics into their key performance indicator dashboards, looking at such things as the number of complaints, inbox placement rates and maybe some other metrics.
On the other hand, there are others who, while they understand that deliverability is an important concept, fall victim to the “end of quarter” syndrome, where the boss asks for more revenue and directs the marketer to just send out “just one more” e-mail to everyone instead of to segments. This can damage deliverability as well as reputations.
BtoB: Where does the danger lie?
Blumberg: There are two tradeoffs, one short and one long. The long-term tradeoff is, if you overmail your subscribers and send them stuff that isn't relevant, you'll wind up with more complaints, unhappy customers and fewer opens and clicks down the road. The short-term tradeoff is even more painful. Say you send out that one extra blast and generate so many complaints that you're put on a black list or blocked by your ISP. Then none of your mail gets through.
I have a client for which everything was going fine and they were generating a tremendous amount of sales through e-mail. But they got a little too aggressive on a couple of their campaigns, mailing three times a week instead of once a week. Hotmail received a significant amount of complaints and blocked them. We fixed the problem, but it took three days at an estimated cost to them of $1 million a day.
BtoB: Where is e-mail marketing heading?
Parkin: Things are blending with marketing automation, and the differentiation is how quickly the e-mail service provider can take direction from what the marketer is tracking online. Say you see someone viewing a particular product, or checking out a very important case study or just downloading something. Now that stimulus can prompt the ESP to fire off a very relevant message in support of that action. People are excited about that.
Of course, they need to realize that just because they can do it doesn't mean they need to create more noise through excessive touches. The e-mail marketer must be engaged with what is happening from a broader marketing perspective. You can start the segmentation early with how a person came to your site, whether directly or through search. Those are cues on how engaged the person is, and should determine how you engage back with e-mail.
Blumberg: The inbox is starting to get a lot more interesting. All the big four ISPs—AOL, Gmail, Hotmail and Yahoo—are running experiments allowing e-mail to have video and audio that would have been blocked automatically in the past. E-mail is a competitive business, and the ISPs want subscribers to have great experiences.
But my prediction is that if rich media becomes readily available, it will immediately be overused—which will prompt some sort of backlash. One or two pieces of video in your inbox is interesting; 15 pieces of video in it is not interesting.
Talavera: There has been some talk lately about whether Facebook will make Web pages obsolete. On Facebook you can have fan and interest pages, and within those you can create custom tabs that are very much like Web pages. The issue is, however, that there are more and more points of initiation online where people can engage with others, and e-mail will drive the conversational flow after that. It won't matter how the conversation begins; we'll still use e-mail on the back end to engage further and make offers.
Teshima: Things will definitely become more integrated, in determining the correct channels to “poke” at a prospect to pay attention. And we're starting to see e-mail used for multiple areas in the customer life cycle, not just for new sales. As a result, there will be the need to differetntiate e-mail types, between transactional communications and marketing/lead-gen communications. They're both marketing but with different intent, and you don't want the two to become confused
BtoB: Do you have any best-practice tips to share?
Teshima: When we did an analysis of best-in-class performers, the No. 1 factor that tended to drive open and click-throughs was the time the message was sent. If, for example, a prospect goes to your knowledge center and downloads a white paper or sees your portal, don't wait until your next scheduled batch, which may be 30 days out. Communicate quickly. Something remains top of mind for only about 24 hours. You need to communicate quickly and keep them teased along.
Talavera: In e-mail, whether you're sending to prospects or existing customers, a certain percentage of people will open a particular message and either click or not, and others won't even open the message. I recommend resending your message to those who didn't even open it, maybe with a tweaked subject line, to give them another chance. It's a timing thing; the first blast might not have been the right time for them. If you give people a couple of different chances, it's more likely they'll engage.