Emails Role and Future Thoughts

by Greg Cangialosi on October 31, 2007

Over the past 2 years, email has weathered an amazing amount of scrutiny around its supposed demise and lack of effectiveness as a medium. With the rapid emergence of the social web, and a new breed of web 2.0 applications scouring the internet, its no wonder many people don’t view email as a critical component of the new media landscape, and in the eyes of some, has been brushed aside as an important medium.

To date, I have not said very much on this or other blogs in regards to these random opinions and theories, outside of the casual blog comment here and there. However, I do believe that the time has come for me to weigh in with my perspective, and offer some future thoughts around the medium. Being that I run a successful email marketing company, I have some insights and thoughts to address the supposed demise of email marketing, and speak to the claims that people like Jason Calacanis are spreading at conferences, like “email marketing is over, you can’t do email marketing anymore.” Jason may know a lot about blogs and search, but his knowledge and awareness of email as a medium is clearly “off.” Lets take a look at some of emails more powerful roles, and see how it fits into the landscape today.

Backround & Validation:

Yes, email has been around for a long time, its been around so long that even with web 2.0, social networks, podcasting, rss, new media, etc expanding rapidly all around us, email is still THE dominant application on the internet. The number one dominant application, worldwide, by a long shot. Thats a powerful stat to know. 77% of the daily sampled population of the Pew Internet and American Life Project recently said that Email remains the most popular application.

Email is not only dominant as an application for users to communicate and connect, this type of adoption has also made it dominant as a marketing communications medium as well. This is evident within a variety of executions of email as I will outline below.

I am very much of the belief that email as a medium is just now getting ready to evolve to the next level, and prove itself once again to be an ever important, critical spoke on both the marketing and social communications wheels.

Core Applications of Email:

Lets now take a look at some of the various ways that email is used first in a marketing role and then second on a social marketing level:

Loyalty & Retention Marketing

Perhaps one of emails most powerful benefits is its role in powering loyalty and retention marketing to an existing group of clients and prospects. These are email communications that consist of your monthly email newsletters, company and product updates, promotions, incentives, etc. Email is all about building a dialog with your audience, and moving towards an experience of relevance, getting as close to 1 to 1 as you can get. By leveraging even basic data sets and analytics, email can be an incredibly powerful medium for nurturing new business, and cross selling / up-selling your existing customers.

More than ever, companies need to focus on the data and continue to present their audience with targeted, relevant information. One of the most important tools in using email to me, is the presence of a subscriber preference center that allows your recipients to drill down to the content level (where applicable), and choose what they want to receive from you and often how. This preference center is also an incredible area to cross promote other content that your company may produce, ie. subscribe to the corporate blog, an RSS feed, audio or video podcasts, etc. The preference center is a key element to any online communications program.

As for the future of email marketing’s most successful deployment, I am going to let the following stats from the recent DMA report speak for itself. Just look at the ROI from email over other mediums:

With numbers on return like that, and due to the economics involved, I believe that email will continue to be THE driving medium behind the most successful customer loyalty and retention programs out there.

Customer Acquisition

Acquiring new customers through email marketing can be an effective, yet challenging marketing strategy. I am talking specifically about the email list rental business, or advertising or marketing to a list or and targeting an audience to email an offer or promotion to, much like in the way the direct mail business works. Email, of course, is a lot cheaper, more targeted, and much more measurable than direct mail, and plus its much more planet friendly.

As mentioned, although this can be a tricky thing to get right, it can also be an incredibly powerful way to acquire new prospects and leads. If your target list is high quality, and is being maintained by a credible organization like Postmaster Direct, then the right offer, to the right list, with the right creative and the right call to action can be very effective. Many publishers of websites, off-line magazines, trade publications, etc offer programs where they offer their subscribers the option to receive 3rd party advertisers on a limited basis. In some cases the participation is extremely high due to the nature of the industry, and in others it is not.

I believe the practice of list rental is still here to stay. Although it runs under a lot of scrutiny, I do believe that some of the economics around the industry may change over the next 12-18 months. I think we will begin to see more performance based compensation models put in place that may circumvent the overall effectiveness of the CPM buy, not that CPM is going away by any stretch. Of course, it all depends on what the campaign goal is, so it would definitely have to be done on a campaign by campaign basis. I am looking forward to seeing how this space evolves.

Transactional Email

One of the most overlooked executions of email as a marketing channel is that of the “transactional” email. Transactional emails are delivered to recipients after a purchase or after a particular action has been taken, i.e. sign ups, RSVP’s, purchases, etc.. These messages typically serve as the confirmation or acknowledgment of a recipients action, or the notification of the stage of where a recipient is in the process of an order.

Like many of the examples above, transactional email represents an incredible opportunity to develop the relationship with your customer or prospect, and start a dialog right away. These initial communications also offer a perfect opportunity to cross / up-sell your customer on your other products & services. This is all to often an overlooked marketing opportunity.

As far as the future of transactional email, can you even remotely imagine a future without it? It is at the very base of all email marketing, and is here to stay, as long as electronic messaging is. I think transactional email will get more interesting and definitely more effective in the future.

Social / Dialog Driver

This is, at the same time both the oldest and the newest use of email. Today, email represents the “driver” in a web 2.0-3.0 world. Email isn’t going anywhere, in fact, whether we know it or not, email is actually becoming more and more important to us than ever before.

Beyond email marketing, are the email communications that not only make up our personal one to one dialog emails, but are also the ones that drive the dialog. This can be driving the dialog in a social network, notifying you when someone who is in your social graph took an specific action, or alert you to a new blog post you are subscribed to, or a new piece of audio / video content, etc. Email is a driver.

This type of email was recently coined as being called BACN. BACN, a form of transactional email all on its own, drives dialog and consistently “alerts” people of new events or other messages, usually in social networks or applications. Whats ironic is that sometimes often these messages just point people back to another inbox. Think about when you get a Facebook email, it is normally a simple notification that someone left you a message, or added you as a friend, etc. And at the end of the day, all you are doing is going from your email inbox, to Facebook’s internal email system. All that said, we need to think beyond the BACN.

Email is much more than just marketing, its now a dialog driver within the new media landscape. This is a big part of Email 2.0. As my friend, colleague, and client, Christopher S Penn states, email is the “currency of accounts.” Meaning that email is the driver, the one medium that brings us all together. It is the one commonality of all of the various elements of the social web, the email address. Think about that for a minute.

Future Thoughts:

Outside of the undeniable data that backs up email marketing’s cemented future, I believe that email will continue to be a big part of the social fiber that we all live by in today’s connected world. I think that email is becoming more and more important to us, and that it will actually expand in the ways in which we use it, not only when, but where. As my friend and colleague Jeanniey Mullen said in a recent presentation, email is electronic messaging, so clearly we need to think beyond the inbox. Think mobile, networks, rss to email, text / sms, etc.

The role of email is expanding, it will continue to drive incredible ROI for marketers, play a key role in the way we communicate with each other, have an affect on how we are alerted to events and actions that are occurring in our own respective worlds, and how we are notified of new content being published, and affect in some cases how and when we consume it. And as time goes by I am sure there will be many more elements to add to the mix.

What do you think? Feel free to add to the conversation in the comments below, or share this post with a friend.

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{ 5 trackbacks }

Ryan Irelan » Email Isn’t Dead
November 1, 2007 at 1:42 pm
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{ 2 comments… read them below or add one }

Matt Blumberg November 2, 2007 at 8:02 am

Amen, brother!

A couple quick stats from Forrester’s recent 5-year US Interactive forecast will back this up con gusto:

- 94% of consumers use email; 16% use social networking sites (and I assume they mean USE them – not just get solicitations from their friends to join)

- Spend on email marketing is $2.7b this year, growing to $4.2b in 2012

Sure, email by 2012 is the smallest “category” by dollars spent, but if you really understand how email marketing works, you understand that dollars don’t add up in the same way as other forms of media since so much of the work can be done in-house.

What really amazes me is how all these “web 2.0″ people keep talking about how email is dying (when in fact it’s growing) and don’t focus on how things like classifieds and yellow pages are truly DYING, and what that means for those industries, and for the overall efficiency of ad spend.

Thanks for the comment and link to Postmaster Direct as well.



kimberley foster November 2, 2007 at 11:39 am

I think you are quite right, for all the points that you made. However, I would like to add that, amazing that it might be, there are many, many people out there uncomfortable and/or unfamiliar with the computer. And email is where they begin their learning curve. And many stay right there.


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