Why are B2B e-mail rates dropping?

HARTE-HANKS, a worldwide, direct and targeted marketing company based in San Antonio, TX has some answers ...

Average business-to-business e-mail response rates are steadily dropping for some obvious--and some not so obvious--reasons, reports a new "Building High Response E-Mail" study from the market intelligence team at Harte-Hanks, Inc. (NYSE:HHS). What separates the extraordinary e-mail campaigns from the ordinary? That was the purpose of the recent Harte-Hanks research, which examined 2,626 permission-based e-mail campaigns (more than 17 million messages) to uncover the strategic and creative practices of successful e-mail marketing from 2002 to the end of 2003.

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The study primarily focused on business-to-business campaigns in the tele-communications and high-tech markets that were designed by clients and executed by Harte-Hanks from January 2002 to December 2003. Based on this two-year time period, average click-through response rates, broken out by time of year and purpose of campaign, ran as high as 4.7 percent in early 2002, but only as high as 2.1 percent in late 2003 (in both cases, market research recorded the highest rate). E-MAIL CAMPAIGN TYPE 1H02 2H02 1H03 2H03 General Marketing 1.3% 1.3% 0.6% 1.0% Market Research 4.7% 2.8% 2.4% 2.1% Sales Promotion 1.6% 0.8% 1.4% 0.7% Seminar Invitations 1.0% 1.0% 0.8% 0.4% Webinar Invitations 1.1% 0.7% 0.4% 0.3%

To determine the reasons behind the drop in response, Harte-Hanks conducted a quantitative survey of 438 business and technology managers between September 2003 and January 2004.

"Increased volume has led to increased clutter," said Randy Wussier, vice president of product development, market intelligence, Harte-Hanks. "Our survey revealed that 48 percent say they are receiving too many unsolicited e-mails at home, and 31 percent said they are receiving too many unsolicited e-mails at work."

Permission Helps Drive Acceptance by Recipients

However, there are e-mail messages that these managers do want to read: 74 percent of business and technology manager respondents have opted in to at least one e-mail list during the past 24 months. Of that figure, 14 percent have opted in to 10 or more lists, and 39 percent have opted in to between five lists and nine lists. By category, these "opt-in, permission e-mail lists" break down as follows: TYPE OF SITE OPTED-IN TO % Sites where I made business purchases 65% Sites where I made personal purchases 64% Technology news sites (CNET, Computerworld, etc.) 39% Sites with technology e-newsletters 34% Sites where I researched business purchases 33% Sites with business e-newsletters 33% News outlets (CNN.com, Wall St. Journal, etc.) 31% Sites requiring e-mail address for a business subscription 30% Sites requiring e-mail address for a subscription to a tech 30% publication Sites where I researched personal purchases 22% Sites requiring e-mail for personal subscription 19%

"The not-so-obvious reason behind the drop in response rates is that e-mail appears to be much more a sales tool now than it was two years ago," Wussler said. "In 2002, 53 percent of the campaigns in the study were sales oriented, but that jumped to 72 percent in 2003."

Additionally, reports of "spam" (in the eyes of the recipient) show that such e-mail received at work is prevalent, though less than that volume received at home.

Best Practices: Relevancy, Integration Boost Response

Wussler offers two suggestions for e-mail marketers in the business-to-business sector who want to stand out in today's increasingly crowded environment.

* Relevancy is more important than permission alone: The e-mail message must offer relevance and value, as well as permission. Use data-driven segmentation and targeting to match an appropriate offer or call to action to a segment, or to an individual based on available preference data.

* Multimedia integration lifts e-mail response: Never e-mail simply to "broadcast" a message without considering an integrated media approach. E-mail campaigns appear to work better when they are part of larger, integrated marketing programs. E-mail response lift can be 10 percent or more as a result of such integration. Thus, don't e-mail in a vacuum.

More information on the "Building High Response E-Mail" study is available at the Harte-Hanks market intelligence Web site at: http://www.hartehanksmi.com/campaign.aspx?CID=3 [free registration required]

The Web site also contains other free reports and white papers to help technology sales and marketing executives.