According to the Direct Marketing Association “Power of Direct (2011)”, permission based email marketing is bringing in “$40.56 for every dollar spent on it in 2011, compared to catalogs’ ROI of $7.30, search engines’s return of $22.24, Internet display advertising’s return of $19.72 and mobile’s return of $10.51.”
That return on investment is phenomenal and it blows all the marketing mediums out of the water. As a result of seeing this, businesses are beginning to cash in on the revenue potential from opt in email marketing.
To understand the rapid growth of the email marketing industry, we must first observe that the use of the Internet continues to penetrate the US, reaching over 77% of the population in 2010 and email is the number 1 use of the Internet. According to the non-profit Pew Research Center, more than 90% of Internet users between 18 and 72 said they send and receive email, making it the top online activity, ahead of search engine use
Permission based email marketing is not only pervasive in Internet usage, it’s also the dominant method of business communication. According to a 2011 study done by the Marketing Agency, Merkle(1), email is the preferred method of commercial communication by 74% of all online adults, beating phone, social networking sites, and text messaging by wide margins. The same study shows that 30% of total email time was devoted to commercial emails (versus personal), compared to only 17% in 2005.
Another thing that’s driving the growth in permission based email marketing industry is the fact that the return on investment can be calculated with an exact return on investment. You can track your return on investment through sales generated per dollar spent, leads generated per dollar spent, branding and awareness generated per dollar spent. Sales and leads can be measured through simple analytic integration as well as branding and awareness.
You can find out the sales dollars amount brought in through analytic integration where you’ll be able to see that $23,000 was brought in from a campaign that may have cost $1,800 to launch you can check it out for the number of leads and measure it out on a cost per lead basis and figure out that you’re bringing in leads while below your cost per lead through your other lead sources. And then also your generating branding and awareness when you get inbound links generated to your website, you generate buzz about your company across the internet. And then you bring traffic, a measurable amount of traffic into your website as a result of the email initiatives.
There are 4 basic steps to building a very successful permission based email marketing strategy.
- Build a quality opt-in database and collect just enough useful data.
- Send timely messages that are relevant to the subscriber.
- You want to segment your database
- Send your messages with the backing of advanced technology and ISP relations.
So what you want to do go a little more in to detail about each of those steps now.
When we’re building a quality database, there’s two things we want to keep in mind especially. Utilize existing traffic coming in to your website and number two use double opt-in mechanisms in order to ensure quality data gets put into our database. So basically for step one, in this we are, you are already driving traffic to your website. If you’re with result, you’re driving traffic to your website. People are coming to your website. They might come once and they’ll never come back again. Capture them when they come to your website. Make it part of your existing website itself where there’s a simple field email, subscribe and then use an incentive to get people to subscribe.
Receive a monthly newsletter with information and secrets about what’s happening in an industry x or if you’re in traditional type e-Commerce, you could say sign up for a newsletter and receive information about products and services that you’re interested in, receive special promotions and discounts, etc. So you can take those people, capture them, send them an automated follow up email, confirm that subscription, send them another automated email instantaneously welcoming them and up selling them. In addition, then you can send out a monthly newsletter continually reengaging them in the process of your marketing campaigns.
Then, another part I want to stress here is the double opt-in. There’s something out there called spam-bot. They scour the internet. They look for single opt-in forms then they’ll sign up for your email newsletters. Then when you send them an email, you can get caught in the spam-bot and the one the email goes out, any email that arrives at that spam trap email address, you’ll end up getting caught in the spam filter as a result of the black listings that occur from that email arriving in that spam trap.
Another way to build your database is use current customers, potential clients that you’re working with and you want a network with these individuals. Get their email addresses and then send them communications. If you have a database of potential clients you’ve been marketing to through traditional sales or snail mail what have you and they’ve acquired over time and you have the email addresses and you essentially done nothing with them, maybe it’s not a good idea to contact a 5 year old lead and just start blindly once a month sending them an email newsletter solicitation. It’s not a good approach.
What you want to do is use double opt-in approach send them an email asking them to confirm their subscription using advanced tracking so if they click on the link, the John Smith clicked on the link to confirm their subscription, and then you just direct them to a page that says thank you for signing up.
So, those are ways to build your database. In addition you can use a quality like refer a friend program attached with some incentives and encourage people to forward your message on to a friend. Any high quality email marketing vendor can help you in such as these plans to build a quality database using quality double opt-in techniques.
The next step is to send timely messages that are relevant to the subscriber. The new spam of the internet is simply non-relevant email. If they opted in and you send them a non-relevant message, your message is considered spam by the recipient. They’re going to hit that report spam button. They’re going to move you to the bulk folder. They’re going to hit the delete button. That’s not something you want.
So, one thing we can do here is make sure that our messages are relevant to the recipient. An example of how we can do this for you is someone subscribes to your database. Once they subscribe, they are sent an email and they confirm their subscription. You have the double opt-in email taken care of.
The next part of the process is once they sign up for a subscription based service say for example you may be offering, when they subscribe to that, they may pay for a one year subscription for a thousand dollars, thirty days before that expiration comes up, you can send them an automated email follow up saying your subscription’s about to expire in thirty days go to this website to renew now. They go to the website and once they’re at that website, they can renew their subscription. You can set that up at 15 days, 5 days, 4 days, 3 days, 2 days, 1 day completely automate the process. In those emails, not only are you reminding them their current subscription is about to expire but also up sell them on similar subscriptions that they could subscribe to. This is a proven permission based email marketing technique to drastically improve revenue at a very low cost.
The next step to take and integrate into your permission based email marketing solution is to segment your database. Monitor the opens, clicks, browsing activities and purchases of your sip-ins and segment them accordingly to folks that have purchased and folks that have not purchased. Folks that have clicked on product A, folks that have not clicked on product A, folks that have clicked on product B, etc. And then if say for example someone clicks on product B, you know they’re interested in product B, segment them a new product B database and then in the future you can use a dynamic campaign where product B shows up first and foremost in the email or you could send a campaign specifically about product B just to the product B database.
So, that’s some of the real value in the segmentation of your database. If you have a large database and you’re not segmenting it, you might have an open rate of 10% and click through rate of 10%. But using some of these advanced techniques and segmentation, you can get your open rates to about 55-65% and get your click through rates up to 25%. So you can really make some fine improvements simply just by segmenting your database and sending relevant information to them.
It’s really important when it comes to email basically your email doesn’t reach your recipients, it’s worthless. So you want to send your message with the backing of advanced technology and strong ISP relations. If you either need to do this at your house in-house have a full time ISP relations person on staff or you need to outsource that. There is white list out there. There is feedback loops. There’s hundreds on black list. These all need to be monitored and relationships need to be made with these black lists in each ISP in order to make sure that you’re well taken care of.
You also need to monitor deliverability by ISP. Are you going into the inbox, are you going into the bulk folder or you’re getting completely eaten by spam filters. Most of the places out there, this is a little secret, most of the folks that are out there in this technology that’s out there are going to say your message went out to 25,000 folks and you had 2,000 that bounced. That’s all they’re going to tell you in the report. They might even tell you those 2,000 are out of bounds. But what they don’t tell you is what your deliverability is by ISP and they don’t tell you that if the message had got caught in a spam filter, the spam filter probably didn’t send a bounce notification back to the sender. Therefore, you may have only reached 40% of the actual market that you thought you did. So that needs to be monitored and the ISP or your ESP, your Email Service Provider needs to be able to prove to you that they’re getting that deliverability and be able to show it to you.
The last thing you want to do. This is also tremendously important. I’ve really got to pound this in. In order to accurately segment your database, you want to track the activity of a recipient and send them a relevant message at a relevant time. So, the big picture of this whole thing is with permission based email marketing, you can drive lots of new sales, you can up sell current clients, you can track an exact ROI, and see a dramatic improvement to your bottom line.