Spam: annoying but effective

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The subject headers scream: "Cut your debt," "Enhance your attractiveness," "Free auto warranty."

It's a spam jam that shows no signs of abating despite a surge of media attention to the issue of unsolicited bulk e-mail, fraudulent and otherwise. Meanwhile, spam-control legislation is on the table in Congress and consumer backlash is escalating. The American Association of Advertising Agencies recently approved guidelines and standards for e-mail marketing as its members have said unscrupulous practices by spammers are hurting legitimate e-mail marketing efforts.

But if spam gets such a bad rap and legitimate e-mail communications are increasingly confused with fraudulent spam, why do marketers continue to use it?

Bulk e-mail marketing appears to get results. Legitimate e-mail advertisers typically see a 5% to 7% success rate in their e-mail marketing campaigns, compared to 1% to 3% for traditional, offline direct-marketing methods, according to The Radicati Group.

"It's just more immediate, it tends to get to people when they're more prone to take action on things," said Sara Radicati, president-CEO of the Palo Alto, Calif.-based market research firm. Ms. Radicati doesn't think consumers have trouble determining what is legitimate and what isn't: "Marketers know when they market something that some percentage of people are going to find it a total annoyance and some aren't."

A 2002 Forrester Research and Association of National Advertisers report estimated that more than 90% of advertisers use e-mail marketing as a part of their direct-marketing programs, including Hewlett-Packard Co., Gap, Victoria's Secret, Coach, MasterCard International, Citibank, Marriott, Priceline and Travelocity. The biggest consumer categories for spam include airline/travel, financial, adult/sex and products ranging from consumer electronics to apparel and health/pharmaceutical. The volume of spam rises sharply from October-December as holidays draw closer, according to Brightmail, a provider of anti-spam controls to Internet portals and corporations.

4.9 trillion

Spam isn't going away anytime soon. The Radicati Group projects that 4.9 trillion spam e-mails will be sent this year.

And despite the rash of misleading subject lines and bogus offers, a recent survey of 2,327 marketers found e-mail marketing results based on open and click rates remained unchanged from 2002, according to MarketingSherpa, a marketing consultancy. The survey revealed that 5% to 6% of marketer respondents said open rates "decreased significantly," while 15% said they "increased significantly."

In a targeted marketing campaign where people have asked for more information by opting in or clicking to a legitimate Web link, "you can get 10% to 15% of people on a good day actually responding positively and purchasing the product," said Dave Cowings, director of business intelligence, Brightmail.

But experts warn maintaining those response rates will be more difficult in the face of ever more sophisticated spam filters. "For our clients they will have to work harder to keep the response rates where they are. It's an extra hurdle," said Kevin Johnson, senior VP-products and marketing, Digital Impact, a San Francisco-based bulk e-mailer.

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