SPONSORED SUPPLEMENT: Making the most of the email marketing tool

As deliverability and spam issues get resolved, e-mail marketings focus turns to relevance and customer relationships

When the CAN-Spam Act became law nearly two years ago, many e-mail practitioners worried about the effect that the new e-mail regulations would have on the use of e-mail as a marketing and customer relationship tool. Nearly 24 months of experience have shown that while CAN-Spam has done little to reduce unsolicited e-mails in consumers inboxes, it also has not dented marketers ability to communicate with customers via e-mail.

What it has done has been to help tune marketers into the importance of how they use e-mail and how well they target their e-mails to customers. The overarching theme in todays e-mail market is relevance, says Matt Seeley, president of CheetahMail, an e-mail services provider that is part of Experian Inc. It has to be relevant to the consumer at the individual level.

The Permission Wave

Closely related to the CAN-Spam issues were concerns over the deliverability of e-mail. While the federal government was looking to regulation to keep consumers inboxes junk-free, Internet service providers were looking to technology and their own internal systems to achieve the same end. That created a challenge for e-mail marketers trying to figure out how to get around spam filters. That issue , too, is now under control, notes Loren McDonald, vice president of marketing for e-mail services provider EmailLabs. There was a lot of talk about the death of e-mail and many people were blaming the ISPs for all their problems, McDonald says. But today most companies have moved on from that. They realize that deliverability issues were a bump in the road and now theyre focusing on improving e-mail practices.

In fact, the future of e-mail will be as far from spam as it can get, some believe. Were seeing the Permission Wave in the evolution of e-mail, says Mike Adams, CEO of Arial Software Inc., a provider of e-mail management software. A lot of people have moved from one level of e-mail marketing to another. The future will be all about relationship marketing.

That notion is gaining wider acceptance throughout the market, says John Harrison, vice president of strategy and client services for e-mail services provider Yesmail, a division of infoUSA Inc. He believes that the new focus on making e-mail messages relevant to consumers will finally allow the promise of big customer relationship management initiatives to come to fruition. Until about a year ago, there was lot of talk about building big CRM databases, Harrison says. Now a number of our clients have moved beyond the talking stage. They are realizing that what you can do with e-mail will be driven by what you know about your customers and what you can do with that data.

Trust is everything

The raw numbers about how many e-mails a retailer sends each week or each month are irrelevant today, marketers say. The real questions revolve around why retailers send e-mails to certain customers, how often the customer wants to receive e-mail and what the customer does with the e-mail.

Successful e-mail campaigns start with trust, Adams notes. Trust is everything, he says. Its almost like dating, where you start with limited trust. You ask for a single piece of information, like name or birthday. Gradually you deepen the relationship and prove your merit as an online marketer who deserves their trust. Trust is a process, not a status. It evolves over time.

And its a process of building up data, Adams says. Theres no one characteristic of a single e-mail that will prove that youre legitimate, he says. But, he adds, it starts with sign-up. Set expectations during the subscription process—tell customers what theyll get, how often, the length and so on, he says.

In addition, even marketers who understand the problem and how to address it may not have an easy time building up that trust. We talk to marketers all the time who truly understand, but there are always limited resources in any organization, Adams says. A lot of organizations are still just trying to get the coupons out. Thats all they can deal with today.

One way that marketers can succeed is to build on existing relationships in logical ways, for instance, using a recent transaction to communicate with a customer and extend the relationship. Online retailers today should be taking advantage of the order confirmation e-mail, Seeley says. It shouldnt just say, Heres the order you placed, thanks. It should also include a brand message and tell the customer about other products they may be interested in that are related to the product they bought.

Tracking the results

In addition, Seeley says, messages should be presented in an attractive HTML format and retailers should have the ability to track e-mail messages, including knowing how many e-mails consumers open, how many click on something in the e-mail and how many clicks result in purchases. Those are all crucial elements of relevance. In the last six months weve seen a huge push toward making this happen, Seeley says. People are ready to act.

In addition, Adams encourages retailers to take a non-commercial attitude toward e-mail. You need to go outside the bounds of a commercial conversation, he says. Show passion for what youre doing and connect with subscribers at that passionate level. Fashion is a good example of something that consumers and retail marketers can share passions about, Adams says.

The product and the sale become the byproduct of two people jamming about something that really interests them, he says.

Two developments have taken place in the past year that will help online retailers achieve relevance in e-mail marketing. The first is the growing awareness of the need for a customer database that allows a retailer to tie together all a customers activity, both online and offline. The key is figuring out how to get the best view of the customer and that means integrating all sources of data—transactional, analytic, demographic, psychographic and e-mail behavior, Harrison says.

Thats a tall order, but one that has gotten the attention of retailers in the past year, he says. Weve been in a lot of discussions about how to put in place programs to use all that information, Harrison says. The baseline is how you communicate with and deliver value to the customer. This looks at what else you can layer in to make those communications more relevant.

The analytics component

But its not just enough to have the information; marketing managers must have efficient access to that information. Translation: E-mail does not exist in a vacuum. Marketers are saying, My e-mail information cant reside with just my e-mail vendor. Its got to get into my marketing database, Seeley says.

The second development is the marrying of web analytics with e-mail marketing. Analytics tell a retailer what a customer is doing at the web site. And analytics are more and more becoming integrated into e-mail databases so retailers can understand what customers do after they click on an e-mail, whether they buy then or later. Analytics can tell the retailer that this person who received an e-mail last week after he bought a shirt is the same person who came to the site this week, browsed for a while but didnt buy anything, Seeley says. That kind of information can help make future e-mail messages relevant to the kind of product a certain customer is looking for.

Those developments are taking e-mail marketing companies in new directions. CheetahMail, for instance, bought analytics company Harvest Solutions and renamed the product Site Clarity in March and continues to work with independent analytics companies to provide such information to retailer clients. Owning an analytics company allows CheetahMail to create stronger integration of web site data with e-mail data, Seeley says. By being part of a single company, our clients can track the end user into the web site. For instance, we can make sure that the links are coded properly so when the consumer gets to the site, the retailer can identify who it is and what they do, Seeley says.

While spam issues may have faded and deliverability concerns have eased, many e-mail practitioners believe a delicate balance still exists among e-mail, consumers and retailers. Theres a lot of focus today on improving e-mail practices, says McDonald. In the industrys infancy, many marketers believed they could simply shift direct mail techniques to e-mail marketing. The old direct-mail ways of doing business just dont cut it any more, McDonald says. Everything in e-mail today revolves around privacy, frequency and transparency and marketers are taking all those concerns up a notch.

Responding to the industry

Among the approaches that retailers can take in those areas are to adopt authentication and accreditation technologies, McDonald says. To that end, EmailLabs has worked out an agreement with Habeas to allow EmailLabs to provide delivery monitoring and inbox monitoring services to its clients in an integrated offering.

EmailLabs, too, has worked out agreements with web analytics company WebSideStory to incorporate its HitBox product into version 4 of EmailLabs product offering. And it has other analytics deals in the works, McDonald reports. We are responding to the industry and to clients; this is a major initiative for us, McDonald says.

In addition, EmailLabs has improved users ability to include dynamic content in their e-mail messages. Weve enhanced the ability to assemble components and users can now create complex e-mail messages by clicking on a template, pulling up a box and selecting data fields and copying images, McDonald says.

Coming up is a workflow and task management system that will be designed to assure senders that everything is in order before they send an e-mail message to a list, McDonald says. That system will allow users to set up an e-mail production flow that can include required approvals before the e-mail can go out. Its very scary to press that Send button, McDonald says. There are so many things that have to be done, such as filters to be activated or personalization tags to be included. This will make sure that all steps are completed.

Conversant with technology

Underscoring all e-mail marketers new offerings is the movement to the marketing department and away from IT for campaign execution, not just creation. One of the major trends weve seen is the adoption of e-mail marketing software and services by less technologically minded users in an organization, Adams says. It used to be the web developer or the database technologists who were primarily responsible for this, but today its more and more the marketing or p.r. person.

Thus the interfaces have become simpler, he notes. The database interface for Arial Softwares e-mail marketing product, for instance, mimics a spreadsheet. People know how to open a spreadsheet, click on a cell and input data; we did the same thing, Adams says. The most difficult part is managing the data. We put a database into our product and made it intuitive.

The interface, released earlier this year, was built from the ground up based on how users were likely to interact with the data, Adams says. We looked at entry level users to see what they tried to do, then made changes, he says.

But that doesnt excuse the marketing and business part of the operation from knowing about the technology, McDonald says. Because of its very nature, e-mail marketing is about technology; its the technology that makes it so successful, he says. You dont need to know exactly how the technology operates, but you need to be conversationally competent. If, for instance, you dont know that you can sync data from an e-commerce engine to an e-mail marketing engine, then you wont know that you can do a lot of real-time e-mail triggered by something that a customer does on a web site.

Seeing the bigger picture

All e-mail marketing eventually boils down to the bottom line and thats where theres still room for improvement, e-mail experts say. Analytics provide insight into how customers use and respond to e-mail, but there are still plenty of e-mail users who dont get tracked. There are many privacy issues, Adams says. People dont want to be tracked. With all the phishing thats going on, its a legitimate concern

With the holes in tracking ability, Adams cautions that ROI calculations are difficult when it comes to e-mail. Its haphazard, at best, he says. There are no magic tracking solutions that work. Marketers need to combine tracking with other solutions. Use statistical regression analysis, look at how your marketing campaigns perform over time, isolate the variables, he says. Theres no magic bullet.

On top of all the concerns about how to execute and track e-mail programs, are concerns about how e-mail marketing fits into the bigger organization. While many e-mail marketing managers focus on the execution of programs, organizations must ensure that their infrastructures are ready to meet the new demands of the e-mail marketing world, Harrison says. That readiness starts with a plan, he says. If youre going to be successful in e-mail marketing, you need a clear understanding of your goals and objectives, he says. If youre driven by sales, you need a plan around that. If youre a manufacturer, you might want a plan around purchasing and education. But you have to understand that a purchase program is very different from a purchase-and-education program.

Furthermore, the technological infrastructure has to be in place. It all comes down to the data infrastructure, Harrison says. Can you flag people as they move from one state of relationship with you to the next—as they move from a first-time buyer to a regular buyer to a lapsed customer

Cross-platform integration

Once a retailer achieves that, the ability to create a customer relationship management program grows even stronger, Harrison says. Then I can talk about how a customer relates to me in more than the e-mail channel, he says. For instance, someone may be a good customer, but a new customer in the e-mail channel. I should know that and treat them differently than I would someone whos a totally new customer where the primary relationship is through e-mail. My Welcome message to one will be different from my Welcome message to the other.

Achieving that level of sophisticated insight leads back to the requirement that e-mail marketing databases tie into customer databases. Yesmail offers the ability to link those. We have a number of clients that tell us, Ive got the raw transaction data, but I dont have the technology to do anything with it, Harrison says. We are very good at utilizing the data infrastructure of a company to help support their e-mail marketing.

What the latest movements in the e-mail marketing arena all boil down to is taking a powerful marketing medium to the next level. E-mail marketers have been dong the same thing for a number of years and many have reached the point where theyre not seeing enough value, Harrison says. Now theyre interested in what they need to do to catapult their programs to the next level.