Sending the Very Best

If you want to click with your customers using e-mail ads, be sure you're sending the right message.
Magazine Contributor
5 min read

This story appears in the November 2002 issue of Entrepreneur. Subscribe »

Sent a promotional e-mail lately? Your customers may be losing interest in these marketing messages, recent survey data shows.

An online marketing study from eMarketer, an Internet research firm, looked at data from a variety of online advertising research firms and found a sharp decrease in consumer response to e-mail advertisements and promotions. The study found that the average click-through rate on e-mail advertisements was 1.8 percent in 2002. That's down from last year, when the rate exceeded 3 percent. Those numbers are not favorable for e-tailers, especially since e-mail marketing has proved to be effective when compared to other forms of advertising such as banner ads, traditional direct mail or general brand advertising.

The study is also disappointing, considering e-mail marketing is cost-effective. An August 2002 eMarketer study found that the current average cost to market an e-mail message in the United States was 0.47 cents. By comparison, it costs 18 cents on average to send a letter bulk rate.


12.4
MILLION
Americans paid for online content in Q1 2002, compared with

7
MILLION
in Q1 2001.
SOURCE: Online Publishers Association

Analysts blame the decline on a shift in consumer psychology: People are so bombarded with e-mail advertisements today that consumers are not as curious about the offers as they once were. After all, the amount of information accessible to consumers is growing exponentially every few years, making lots of information disposable. According to some studies, the average consumer is exposed to more than 8,000 commercial messages daily-via e-mail, print, TV and other media.

But e-mail marketing won't be going away anytime soon. So, what's the best way to get customers to respond? "As long as you send the right kind of e-mail, which is well-planned and customer-focused, you'll get a great response," says David Hallerman, a senior analyst at eMarketer. "Unless you have a permission-based list, you are not going to get responses."

If your e-mail is perceived as spam, and if it is sent to potential customers who never indicated they wanted to receive e-mail specifically from your company, "then it may not be read at all, or worse, it could annoy the consumer," Hallerman says.

Ultimately, the key to customer click-through is creating a relationship with your customers, which happens to be something growing businesses are very good at. "Consumers want e-mail marketing messages from companies they know and trust," Hallerman says. "And by their very nature, small businesses have a better time of making a connection with their customers than large corporations."

But there are still other ways to improve your chances that customers will click, such as choosing the right day to send e-mail messages. Believe it or not, this choice can make a big difference. According to Hallerman, "In terms of looking at e-mail messages sent during the week, we've found that e-mail messages sent out on Monday and Tuesday get a better click-through rate than those sent on Wednesdays, Thursdays and Fridays."

The Right Stuff

Research shows that consumers also tend to respond well to permission-based e-mail marketing messages that contain special promotions, a technique used successfully by Genius Babies Inc., a direct marketer in Charlotte, North Carolina. Once or twice per month, Genius Babies sends out an e-newsletter to its 15,000-strong opt-in e-mail list that offers specials and promotions for products featured on its online baby gifts and toys Web site, www.geniusbabies.com.

According to Michelle Donahue-Arpas, 36, president and founder of Genius Babies, the specials, which are usually free gifts with a purchase or coupons, work well. "[They] always bring a great increase in sales for several days after sending them out," she says. "We're always bombarded with orders."

Donahue-Arpas uses an e-mail marketing communications system from Roving Software called Constant Contact to create and send the e-mails; the service costs $150 per month for up to 25,000 e-mails per newsletter. In addition, the service tracks such measurements as click-through rates. In fact, Donahue-Arpas believes she regularly has click-through rates in excess of 15 percent for each of her promotional e-mail newsletters.

The technology also lets Donahue-Arpas identify the most successful campaigns. "The best results we see are with 'free gift with any purchase' promotions," she says.

So what's the key to her success in e-marketing? The fact that recipients choose to receive the e-newsletters. In other words, customers and prospects won't receive e-mail marketing messages from Genius Babies until they sign up on the Web site to receive them. "The most important thing for us is that our lists are opt-in," she explains. "Everyone who gets e-mail from us knows they will get them and wants them."

Donahue-Arpas also attributes her success to the fact that she works in a niche market. It helps that her business is small enough to allow her to foster personalized relationships with her customers. "I create my own newsletter, and most of my customers know who I am," she says. "We've never tried to pretend that we are bigger than we really are, and that has enabled us to create real relationships with our customers."

Clearly, e-mail marketing is here to stay, and eliminating a no-results campaign from your promotional strategy isn't the way to go. Instead, take a closer look at your recipients-and make sure to send them the kind of information they want and expect.


Melissa Campanelli is a marketing and technology writer in Brooklyn, New York.

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