October 30, 2007, 12:00 AM

The new obstacles to e-mail delivery

Challenges to e-mail delivery now focus on the sender, not the message. Retailers have to adopt new strategies to ensure a sparkling reputation.

Consumers are increasingly disgusted with unwanted e-mail. They and the Internet service providers that funnel e-mail to them are continually adopting new tactics to keep out unwanted mail. That means retailers must keep on top of both ISP policy and consumer sentiment as they seek to deliver their marketing messages via e-mail this holiday season.

Consumer e-mail fatigue is evident in Forrester Research data that show 77% of online consumers felt they were getting too many e-mail offers and promotions in a survey late last year, compared with 44% in 2000. Nearly 27% of online consumers said they responded to the increase in e-mail last holiday season by reporting the sender as a spammer and 24% unsubscribed, according to a study by e-mail service provider Return Path Inc.

Overwhelmed by the growing volume of e-mail, most of it spam, ISPs are relying less on scanning the content of each message to determine if it is legitimate and more on assessing the reputation of the sender. “It used to be that content was key,” says Linda Muniz, senior vice president of Belcaro Group Inc., which operates ShopAtHome.com, a site that offers discounts at more than 2,000 stores. “They would really look at your content: are you using the word free too much, or mortgage or credit card? Now they’re looking at reputation.”

In fact, 83% of deliverability problems today stem from poor sender reputation, according to Return Path. That means retailers must focus more on preserving their good name in the eyes of the ISPs-and of their customers.

Just getting a consumer’s permission to send e-mail does not guarantee it will make it to the inbox: studies show 16% to 20% of permission-based e-mail is blocked as spam or shunted to a junk or bulk mail folder. “Marketers are wasting over $100 million a year on messages they send but that don’t reach the inbox,” says analyst David Daniels of JupiterResearch.

The strategies that worked a few years ago will not ensure e-mail delivery today. Here are 10 tips from retailers and e-mail experts that can help improve delivery rates in today’s environment:

Take complaints seriously

One sure way for a marketer to get a bad reputation in the eyes of ISPs is to have lots of recipients hitting the spam button. “If as little as 1% of your customers complain, the inability to communicate with your entire customer base may be the end result,” Microsoft Corp. wrote in a recent paper advising marketers on how to improve deliverability to Microsoft Hotmail accounts.

The first step is to know when recipients mark e-mails as spam, which is not reported to the sender the way an undeliverable address is. Most of the major ISPs, such as AOL, Yahoo and MSN Hotmail, now offer free “feedback loops” that marketers can sign up for to receive notification when their e-mail is marked as spam.

The next step is to quickly remove those recipients from an e-mail list-before they receive another e-mail and hit the spam button again. Marketers can reduce their complaint rates by as much as 40% by acting quickly, says George Bilbrey, vice president and general manager of the Delivery Assurance Solutions group at Return Path.

Apparel and outdoor gear retailer Sierra Trading Post Inc. minimizes spam complaints by making clear to recipients how they can unsubscribe, then deleting the e-mail address of someone who does unsubscribe within 24 hours, says Marc Angelo, online marketing manager.

But he says the main way to keep customers from complaining is by sending the kinds of e-mail they want. Sierra groups customers based on what they have bought and then sends e-mail with targeted offers. For instance, a customer who bought a ski helmet last year might get an offer for winter sports gear.

“The biggest tool is staying relevant and presenting our message to customers in a way that they feel makes sense to them,” Angelo says.

Pay attention to non-responders

ISPs also pay attention to low open and click-through rates from a particular sender, because that fits the profile of spammers who blast out messages to large numbers of e-mail addresses, hoping at least a few will respond.

Such low rates can damage a sender’s reputation, which makes it important to keep an e-mail address list up to date. As many as 30% of the addresses in a typical e-mail list may go bad in a year as consumers switch e-mail addresses for various reasons, according to FreshAddress Inc., a company that provides e-mail updating services.

Consumers who do not respond may not be interested any longer, and are likely to start hitting the spam button, further damaging the sender’s reputation. This happened to a large specialty retailer that found itself exceeding some ISPs’ complaint limits and having its e-mail blocked for days at a time, says Kirill Popov, senior manager of deliverability at e-mail service provider Responsys Inc., who declines to name the retailer.

Analysis showed that recipients most likely to report e-mail as spam were those who had stopped responding to offers, Popov says. The retailer then sent an e-mail to customers who had not shown any activity in six months, noting they had not responded and offering them an incentive to shop at the retailer’s site. Those who did not respond received a stronger offer three weeks later. The retailer purged anyone who did not respond to the second offer.

The effort knocked seven-tenths of a percentage point off the retailer’s complaint rate, enough to put the retailer back into the good graces of the ISPs, Popov says. While he would not provide further details, a decline, for instance, from a 1% complaint rate (10 per 1,000) to 0.3% (3 per 1,000) could mean the difference between a sender’s e-mail being blocked and going through.

While click-throughs are easy to track, open rates are not. That’s because the open report is triggered by a small image file in the e-mail, and many types of e-mail software in use today do not open images as a default, only rendering images if consumers change the setting. Thus, a consumer can open an e-mail without the sender knowing it, unless the recipient clicks to make the images appear.

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