1. Successful e-Mail
Marketing Practices
eMarketing Association
May 20-21, 2003
Gabriela Linares
© 2003 L-Soft

2. Managing e-Mail Marketing
• Defining e-Mail Marketing Objectives
• Determining Communication Strategies
• Reaching your Target Audience
• Designing e-Mail Creative
• Evaluating Results
• Selecting a Solution
• Final Recommendations
© 2003 L-Soft

3. Defining e-Mail Marketing
Objectives
© 2003 L-Soft

4. Common Objectives
• Acquire new leads/ registrants/ customers/ clients
• Drive immediate sales
• Enhance customer retention programs
• Build stronger relationships with existing customers/
clients
• Provide company or product information
• Increase revenues by up-selling to existing customers/
clients
• Post-order targeted e-mails
• Build brand awareness
• As part of an integrated marketing strategy
• Increase web site traffic
© 2003 L-Soft

5. Response Rates by Campaign Objective
North
Conversion
CTR
Awareness 6.80%
17.10%
Sales 5.60%
15.20%
Leads 7.90%
15.30%
Source: IMT Strategies, September 2001 © 2003 L-Soft

6. Acquisition versus retention
Acquisition Retention
Search engine positioning 94% 6%
Banner ads 91% 9%
Referral/viral programs 85% 15%
Affiliate programs/ sponsorships 75% 25%
Incentive programs 51% 49%
E-Mail Marketing 37% 63%
© 2003 L-Soft
Source: DMA- April, 2002

7. Sales Conversion Costs
Acquisition Retention
E-mail $57.10 $2.50
Direct Mail $25.00 $60.00
Banner ads $140.00 N/A
Source: IMT Strategies, September 2001
© 2003 L-Soft

8. Determining Communication
Strategies
© 2003 L-Soft

9. Popular e-Mail models
• Discount sales promotions
• Sales transaction confirmations
• Account statements
• Scheduled corporate newsletters
• Press release list
• News alerts from Media outlets
• Time-based reminders
• E-mail discussion groups/ communities
• Product announcements
• Entertainment (humor, film clips)
• Online education courses
• Product user/support groups
• Auto-responders
© 2003 L-Soft

10. Average CTR for B2C and B2B
e-mail newsletters
North
B2C
B2B
2002 0.30%
1.90%
2001 0.50%
2.80%
2000 0.90%
3.40%
0% 1% 2% 3% 4%
© 2003 L-Soft
Source: Opt-in News, May 2002

11. Top Interests for Permission
e-Mail Users in the US
• Specials/offers from online merchants
• Specials/offers from local retailers or restaurants
• Household tips/recipes/crafts
• Humor
• Travel
• Entertainment
• Weather
• Local news
• Tech/business news
• Finance/stock information
• Sports
© 2003 L-Soft

12. Top reasons why US Internet users
respond to e-mail offers
• Know and trust brand
• Relevant information
• Friend has recommended
• Price/coupon/reward
• Timely
• Compelling subject
• Entertaining
© 2003 L-Soft

13. Viral Marketing: Types of
messages that are forwarded
• Merchandise deals and promotions
• Prize/coupon/reward
• Social/political messages and petitions
• Warnings and advisories
• High level of relevance
• Funny
• Work related
• Informative
• Cool
• New Technology
© 2003 L-Soft

14. How US internet users learn about
new web sites
80%
Search engines
59%
Link from other site
56%
Viral Marketing
48%
Television
22%
Guess URL
0% 20% 40% 60% 80%
© 2003 L-Soft
Source: IMT Strategies, Sept. 2001

15. Reaching your Target
Audience
© 2003 L-Soft

16. US Internet User Attitude towards
e-Mail Volume, 2001
Cannot handle
15%
Too many
34%
Somewhat more
3%
0% 10% 20% 30% 40%
© 2003 L-Soft
Source: IMT Strategies, September 2001

17. E-mail overload: Number of e-mail
marketing e-mail sent in the US
289
2001
430
2002
549
2003
674
2004
796
2005
0 200 400 600 800
© 2003 L-Soft
Source: Forrester Research, August 2001

18. Response to permission e-mail
versus unknown senders
13%
Eager to read
1%
49%
Curious to read
12%
29%
Indifferent
15%
6%
Open but annoyed
21%
3%
Delete
52%
0% 30% 60%
15% 45%
Permission e-mail West Unknown senders L-Soft
© 2003

19. Opt-in, opt-out, double opt-in,
spam: Preferred e-mail marketing
11% 3%
Opt-in
Opt-out
Spam
86%
Source: Opt-In News, May 2002
© 2003 L-Soft

20. Rates for US e-mail permission-
Click-through
17.80%
Net conversion
7.00%
Bounce
7.80%
0% 5% 10% 15% 20%
Source: IMT Strategies, Sept. 2001 © 2003 L-Soft

21. Permission e-mail marketing vs.
direct mail retention costs
Cost per Click- Conversion Cost per
thousand Through Rate sale
(CPM) Rates
(CTR)
E-mail to $5 15% 3.7% $1
in-house
list
Direct Mail $761 N/A 3.9% $20
to in-
house list
Source: Forrester Research, August 2001 © 2003 L-Soft

22. Building your
permission-based lists
• Subscriber form on web site
• Sponsor lists of sites with a similar demographic
• Send to a friend button – viral marketing
• Ask for permission to customer base
• Maintain list hygiene
• E-mail appending…
© 2003 L-Soft

23. Building Customer Intelligence
• Harness your Customer Database
• Evaluate Customer Behavior
• Effective personalization and targeting
• Common Segmentation Factors:
o Purchase history
o Location/zip code
o Demographics
o Lifestyle/hobbies/interests
o Psychographics
© 2003 L-Soft

24. US Internet Users’ Level of
Concern Regarding Online Privacy
8.80%
2000 29.50%
Not concerned
61.70% Somewhat concern
Extremely concern
5.50%
2001 23.10%
71.30%
Source: UCLA Center for Communication Policy, November 2001 © 2003 L-Soft

25. US Consumers’ Privacy concerns
75%
Sharing info with third parties
70%
Transactions not secure
69% 72% 75%
Source: Harris Interactive, February 2002
© 2003 L-Soft

26. US E-Mail users’ preferred e-mail
marketing privacy and customer-
support practices
• Unsubscribe option in all e-mails
• Explicit no-share-address policy
• 48-hour e-mail support answers
• Editable personal preferences page
• Provide phone numbers in e-mail
• Explicit privacy policy
• Double opt-in confirmation
• Unchecked default opt-in box
• Third-party privacy seal in e-mail
© 2003 L-Soft

27. Most Important e-Mail Marketing trust-
building factors among US users
• Secure sign-up form
• Trustworthy reputation
• Loyal customer
• Well-known brand
• Friend recommendation
• Trusted site referral
• Relevant offers
© 2003 L-Soft

28. Why customers would give
personal info
• Guarantee that the information will not be misused
• Eligibility to win a prize in a sweepstakes
• Regular e-mail updates for products of their interest
• Access to more or better content or information
• Affinity points
• Receive targeted ads they’re likely to be interested in
© 2003 L-Soft

29. E-mail Appending
24%
Ethical
Not ethical
76%
Source: Opt-In News, May 2002 © 2003 L-Soft

30. Privacy & Regulations
• HIPPA covers health personal information
• COPPA protects children
• Gramm-Leach Bliley Act concerns financial information
• FTC supports Corporate Privacy Policies
• Federal spam regulation does not exist
• State laws exists in 13 US states, including California,
Colorado, etc.
• More information about spam regulations visit:
www.spamlaws.com
© 2003 L-Soft

31. Creating the Content
© 2003 L-Soft

32. E-Mail Message Content
• Subject Line – getting recipients to open mail is half the
battle
• Creativity
• Personality and dynamic content
• Keep it short and use links to draw reader to your web
site
• Keep it fresh – don’t re-use the same content
• Relevance – the more you understand your customers,
the more targeted and relevant messages will be
• Frequency
• Test messages
© 2003 L-Soft

33. Email users’ preferred e-mail
marketing personalization models
• Communication Control: Digests, Frequency
• Self-select content
• Name recognition
• Personal events & reminders
• Geographic relevance
• Account History
• Recognizing Lifestyle Preferences
• Purchasing Behavior
© 2003 L-Soft

34. Preferred e-mail advertisement
formats worldwide, Q1 2002
3%
35% HTML
Text
62% Rich Media
Source: Opt-IN News, May 2002
© 2003 L-Soft

35. Response rates per format
Click-Through 15.60%
18.50%
Conversion 5.30%
9.00%
North
HTML
Bounce 7.70%
7.40% Text
Unsubscribe 3.20%
1.20%
0%5.00% 15.00%
10.00% 20.00%
© 2003 L-Soft
Source: IMT Strategies, Sept. 2001

36. Evaluating results
© 2003 L-Soft

37. How to measure the effectiveness
of e-mail marketing campaigns
• Click-through rates
o unique and sum of events & comparisons
• Unsubscribe rates
• Open rates
• Conversion rates (website tracking)
• Click-stream analyses
• E-mail pass along rates –viral marketing
• Coupon codes
• Anonymous tracking to respect privacy
• Campaign Comparison Reporting
© 2003 L-Soft

38. Response time and cost per unit,
e-mail vs. direct mail
• Be prepared to handle responses
E-Mail Direct Mail
Response Time 3 days 3-6 weeks
Cost per unit $0.25 $1.25
Source: DMA, Forrester Research, Gartner Group, 2002
© 2003 L-Soft

39. To Outsource or not to
Outsource
© 2003 L-Soft

40. © 2003 L-Soft

41. Maintain your server
• Hardware/computer
network
• Dedicated Internet
Connection
• Software for e-mail
management and delivery
• Best for large loads and
those with experience
• More cost-effective/
economies of scale
• Flexibility to create
campaigns on the fly
© 2003 L-Soft

42. Maintain your server
• Hardware/computer
network
VS. Outsource your list hosting
• Reliability and experience
• Redundant servers and
• Dedicated Internet delivery capacity
Connection • Flexibility to maintain
• Software for e-mail company Internet presence
management and delivery • Ability to move from
• Best for large loads and hosting to in-house when
those with experience ready
• More cost-effective/ • More expensive
economies of scale • Rely on company’s
• Flexibility to create schedule
campaigns on the fly
© 2003 L-Soft

43. Outsourced e-Mail
Marketing Services
Strategy 8%
2%
Creative 10%
0% Bar 4
North
Delivery 68%
28% 2001
2003
Analysis 22%
8%
0% 18% 35% 53% 70%
Source: Forrester Research, August 2001
© 2003 L-Soft

44. Evaluating Options
• Evaluate software product or hosting service before
purchasing
• Determine if solution provides appropriate features
• Decide what reporting features you need
o online real-time reporting, compatibility with other
software you employ
• Differentiating levels of privacy tracking
• Campaign manager to organize jobs
• Integration with your database and other applications
• Handle bounces
© 2003 L-Soft

45. Main Recommendations
• Integrate e-mail into your integrated marketing
communication plan
• E-Mail marketing is best used for retention and other
customer permission-based communications
• Offering sales promotions is the most successful
strategy
• Consider double opt-in and build your permission-based
lists
• Respect recipients’ privacy to earn their trust
• Personalize messages to provide relevant information
which will increase response rates
• Evaluate options and opt for time-tested solutions
© 2003 L-Soft

46. Questions?
5:45pm Consulting Session - Today
Gabriela Linares
L-Soft international, Inc.
www.lsoft.com
Info@lsoft.com
301-731-0440
800-399-5449
© 2003 L-Soft