In many ways, e-mail marketing and small business are a natural fit. E-mail, in theory, offers an inexpensive way for businesses to communicate with customers. And there are many low- or no-cost tools to send out said marketing messages. But over several years of using these tools in my shop, I've found that the reality of marketing with e-mail is often more complex than I bargained for.

For starters, you must be sure that the people you're marketing to have agreed to be marketed to. If not, you can fall afoul of federal anti-spam regulations. And besides, the heart of good business is selling to folks who actually want to buy and not wasting time with those who don't.

Before we get down to the details, let me make clear that we're talking here about communicating with current and potential customers through e-mails and newsletters -- not spamming thousands of strangers with “Vacation in Cancun if you call now” ads. So you may be dealing with, at most, several hundred possible contacts, and perhaps only a few dozen legitimate qualified sales prospects -- people you know or are acquainted with. That means, you should think of them as friends. You want to send valuable content they'll be glad they opened, not assaultive sales pitches that makes them want to hit delete.

Here are our picks on e-mail marketing tools for different types of firms:



Microsoft Outlook
(included with Microsoft Office 2010; $140 if sold separately)
Best for light e-mail marketers fluent in Microsoft products.

Online email tools get all the buzz these days, but Microsoft Inc. has worked hard to keep Outlook 2010 relevant with latest-generation marketing tools. Assuming you already have Microsoft Office 2010, and assuming you keep layouts simple and don't tread into expensive newsletter design and development, Outlook costs you nothing extra. And it can be surprisingly effective.

Why you might like it: You probably already have it, and it can work. Today's Outlook offers some slick marketing tools, such as fast integration with Microsoft Word, the ability to quickly import contacts from Excel and, most importantly, improved mail-merge functions that automate much of the process of sending out a few hundred e-mails.

Why you might not: You are still dealing with Microsoft, so things must be done its way. Expect plenty of tinkering with Word files and how Outlook functions get your newsletters to do what they need to do. Also, Outlook is not the place for sophisticated graphics and layouts. Those will require support to work properly across different email clients. And you will need to confirm with whomever hosts your e-mail server that you can send as many emails you need. Remember, if you violate the anti-spam regulations, you can get blocked from using your e-mail.



MailChimp
(up to 2,000 subscribers are free, monthly fees start at $15 per month)
Best for web-oriented shops sending highly designed e-mails.

MailChimp aims to make e-mail marketing easy so business owners can spend their time making money. As promised, it is easy to design sophisticated e-mail campaigns, share them on social networks like Facebook and Twitter, manage subscribers and track your results. A basic plan for up to 2,000 subscribers and up to 12,000 e-mails per month is free; a monthly subscription starts at $15 and pay-as-you-go rates of $.005 to $.03 per e-mail for infrequent subscribers also are available.

Why you might like it: Creating attractive newsletters with MailChimp is easy. It offers several templates to start with, or lets you create your own. Stats are easy to navigate: You can tell at a glance how many of your e-mails were sent, how many were opened and how many clicks your e-mail got. A particularly nifty feature is a little bar that compares your percentage of opened e-mails and clicks to your industry.

Why you might not: MailChimp's many bells and whistles can lull you into thinking that by filling out its forms, you are finding a solution to a business problem. Which you definitely are not: Its good looks and fancy features will not cover up for a bad list or a poor sales-conversion strategy. You still need to actively sell. Plus, many of the concepts and services like comparative delivery analysis are beyond the average small firm. And they can be a major time waster.



Constant Contact
(60-day free trial, $15 per month for up 500 e-mail addresses)
Best for more traditional firms who send more traditional e-mail newsletters.

Constant Contact reaches out to small businesses with an attempt at being a gimmick-free site that has clear explanations and simple tutorials. It boasts the ability to get newsletters into in-boxes by avoiding spam filters. Like MailChimp, Constant Contact integrates with social media and makes it easy to track results. After a 60-day free trial, prices start at $15 a month for up to 500 e-mail addresses. There are discounts for nonprofits.

Why you might like it: Constant Contact comes with excellent free coaching and tech support. You can expect a rep to call you on the phone to see if you have a question, which makes it a good choice for a beginner. The choice of templates is impressive and includes not just a wide range of newsletters but also business letters, news releases, invitations and more. Each is easily changeable to meet your needs.

Why you might not: Constant Contact is probably the least intuitive of the online e-mail marketing tools I have tested. Learning to master its ins-and-outs can try your patience. And if you have a slow web connection, the problem is exacerbated.

Email marketing is just like other forms of marketing: It's all about results. Using e-mail to sell is a trial-and-error affair. Start by using each tool for a campaign or two, and see which one feels right for your business. Then test out that winner with consistent campaigns for at most a few months. Then be ruthless. If you are not seeing the return on investment, then quit using email entirely. Move to another platform. There are far too many marketing options these days to waste time on a system that does not work.