The Messaging Times

One of the benefits of working with a company whose products are used in over 160 countries by individuals and organizations of all types and sizes, is that you get to talk to some really interesting people. Recently, I talked to the Harlem Globetrotters and a guitarist for the Oak Ridge Boys, both GroupMail customers.

More often than not, the questions come from our not-so-famous (but equally important) customers, like one gentleman who asked if GroupMail could send messages to a list of six million email addresses that he had acquired [yesterday]. Of course, my first inclination was that this list of six million was acquired by some means other than opt-in, permission marketing. I explained that technically, the software allows users to create groups of an unlimited size, but that processing messages to such a volume of recipients would necessitate a robust mail server among other things. It turns out, he wanted to just send them through a free mail server like Hotmail without spending any money on anything but the software.

For the sake of all of us, I dissuaded him.

Another call was a bit more realistic in scope. A woman had an opt-in list of 5,000 recipients and wanted to use GroupMail to send personalized HTML newsletters to her list on a monthly basis. Her ISP (one of the big ones) has an email sending policy that prohibits customers from sending more than 200 messages per day through their STMP mail server. They also block Port 25 so GroupMail’s Direct Send mode wasn’t an option. Bulk Send mode doesn’t allow personalization, so that wasn’t an option for her either. I explained that GroupMail or any other desktop email marketing software doesn’t circumvent the email sending policy of her ISP. I suggested that she:

1. Contact her ISP to see if they have a business account that allows more messages to be sent each day (Comcast, for example, allows residential customers to send 1,000 messages per day while their Business customers can send 24,000 per day);
2. use a secondary outgoing mail server, like AuthSMTP, to route her messages through; or
3. acquire a web hosting company who offers full SMTP services and process your messages through your domain-hosted server. Sometimes, domain-hosted SMTP servers are more liberal with their email sending policy than large ISPs

Again, she didn’t want to spend any money on sending her messages out.

As your email list grows, so does your budget. While email remains to be the most cost-effective method for communicating directly with your prospects and customers and provides the best ROI; it’s not free. Aside from the costs required for email marketing software and access to a supporting outgoing mail server, effective email marketing requires time and effort on list maintenance, design, testing, delivery and measurement.

Effective email marketing doesn’t have to be expensive. But it certainly isn’t free.

Update: Seth Godin discussed another cost of email marketing today in his post, Friction

Let me begin by saying that a successful email marketing strategy takes time to implement. Building a targeted, permission-based email list doesn’t happen overnight, especially if you don’t have a high-volume of visitors to your website. But the value of taking the time to build your list organically cannot be understated. It is simply the best approach for any professional businesses who cares about their reputation, brand and long-term success.

That said, I know that there are marketers out there who are tasked with making things happen quickly. The same was true in traditional Direct Marketing. List acquisition was the cornerstone of a Direct Marketers profession (leads generate sales). But technology (and new attitudes) have changed the game. Using traditional cold-calling techniques as an email strategy is likely to piss people off; and it’s very easy for email recipients to express their distaste for unsolicited marketing. Reporting a message as spam is easy to do, and when enough recipients on your list do it, your domain is likely to get blacklisted. This isn’t something that a reputable business can risk.

Even so, some modern day direct marketers use list brokers as a shortcut to acquire email addresses. There are several methods used for acquiring email addresses. Jeanne Jennings provides a good overview of four of the most widely used approaches for growing a subscriber base: email appends, compiled lists, list rental and email sponsorship.

List brokers charge per thousand email addresses (CPM). According to Worlddata, average cost per thousand email addresses (CPM) in 2007 was:

• Permission Based Email Business to Business (B2B): $277.00/thousand
• Permission Based Email Business to Consumer (B2C): $170.00/thousand

* Click here for more details about Worlddata’s 2007 List Price Index.

If you come across a broker offering you rates that fall well below the averages shown above, you can assume that you will get an old list that will have invalid addresses and/or addresses that were acquired without permission. Either way, your email sender reputation will likely suffer and spam reports against you will rise. Don’t be fooled by brokers offering low cost solutions. You’d be much better off standing with a placard in Grand Central Station.

Better yet, get creative and create an email subscription strategy that inspires people to give you permission to contact them. Create a compelling introductory offer or other high-value incentive and spend that money on building your list organically – via permission.

• Register for our newsletter and receive your first two months free.
• Place some compelling ads online and offline that will reach your intended demographic.
• Create a YouTube channel for your campaign to announce your offer.
• Contact relevant media about the newsworthy value that you are offering.
• Host free workshops in regions of interest relating to your products or services.
• Run a contest for a flat screen television (the television will only cost $1,000)
• Excite existing customers enough so that they will tell a friend or colleague about your products and services.

There is no limit to what you can do to generate buzz about something of value. And if you don’t have something of value to offer, then you might just be wasting your time either way. In that case, I suggest that you spend your money on developing something of value. Then give it away to people of influence so that they can tell others about it.

Of course, the basics apply here. Have an email subscription form on every page of your website. Put it at the top and make it easy for visitors to complete. Tell them that privacy is ensured, explain what they will get and how often it will arrive and provide an incentive for them to subscribe.

In his blog post, Email: Why It Isn’t Digital Direct Mail, Loren McDonald provides some distinctions between email marketing and traditional direct mail. He correctly points out that:

1. Email recipients have more control in terms of granting permission, unsubscribing and having a say in the content and frequency of messages.
2. Electronic delivery is much more complicated, especially with new regulations and filtering systems on the ISP and client level.
3. Metrics are much more complicated in email marketing. There are many more things to measure, from delivery rates to click-throughs to spam reports. But test results (such as A/B) and metrics are delivered much more quickly and accurately online.
4. The format and rendering of your original message shifts from recipient to recipient in email marketing. Image blocking, preview panes and non-standard HTML rendering in email clients make your message appear differently from reader to reader.

One key difference which wasn’t mentioned has to do with the communication channel itself. Email marketing is more effective at building and maintaining relationships because it is much more interactive than traditional direct mail. Recipients can reply immediately with questions regarding your promotion, inquiries about your products or services and important feedback (positive and negative). Email also allows for immediate purchases, subscriptions, registration or membership on your website.

Email is a bridge between you and your customer. It links your products and services in real time with your market and allows immediate access to the value that you are offering.

One way to decrease your unsubscribe rates is to offer email-only discounts. I received one from Overstock.com today as an example.

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Email-only sales add value to your message because they provide an offer that is only available to those receiving the email. This will serve to persuade recipients to stay on your list and, more importantly, read your messages to see what’s on offer each week or month. Of course, this will only work if the email-only offers that you provide are attractive enough to your recipients so that they look forward to receiving them.

What special offers do you provide to your email customers?

If you don’t provide email-only offers, why not?