Practical Ecommerce

Email Marketing: Cultivating a Successful List

Many old-school marketers built mailing lists like your favorite aunt would make spaghetti: Cook a ton of it, and throw it against the wall to see what sticks. If any does, you know the pasta’s done.

In much the same way, before email marketing developed some semblance of sophistication, marketers would pride themselves on building mailing lists well over 100,000- people strong in hopes of getting a couple thousand conversions. They figured email marketing success was a matter of quantity over quality.

The more email we send, the more conversions we’ll garner and – hence – the more money we’ll make.

Wrong. Wrong. Wrong. Wrong. Wrong.

Spam legislation lowered the boom on purveyors of junk email. Users became savvier themselves, and ecommerce businesses realized that they’d have to get schooled not in the ways of mass communicating with all sorts of potential customers via email but in the ways of developing highly targeted relationships with people who have expressed interest in the company’s product.

The only way to establish that type of relationship with customers is to get express permission from folks before emailing them anything. While that sounds like a rudimentary piece of advice, it’s the foundation of building a great email mailing list, or so says executives from three of the world’s most successful email marketing companies.

Gail Goodman, CEO at Constant Contact; Loren McDonald, VP of Marketing at EmailLabs; and Mike Adams, President at Arial Software each stressed the need for ecommerce entrepreneurs to develop a permission strategy for building their mailing lists before the first opt-in page gets posted to a Web site.

That permission strategy is about the dialogue that happens between company and consumer right at the moment that an individual gives the company permission to send him or her email. The consumer expresses the desire to receive x, y and z – perhaps a couple of product-oriented newsletters and an email every month highlighting what you have on sale on your Web site. You communicate to the consumer exactly what it is he’ll be receiving.

Expectations are set. However, the type of communications is only one part of the permission strategy. “Set clear expectations” as to the frequency of communications, said Goodman.

Her company, Constant Contact, provides online resources for small-to-medium-sized businesses to build and manage email mailing lists, author nicelooking campaigns, send mass emails and report on results – such as for how many times an email was opened and how many times the customer clicked on your call-to-action.

McDonald and Adams were also quite adamant about setting clear expectations. The primary thread each executive had in common with the other is that setting expectations as to what kind of emails you’ll send customers as well as how often you send them is the most important thing you can do in building a mailing list.

McDonald suggests being even more specific in the early stages of your email marketing relationship. “Show a sample email and explain the special deals, discounts, exclusives they will get as an email subscriber,” he said. “Include a brief summary of your privacy and email policy and provide a link to the full version.”

His company, EmailLabs, provides online resources to companies to create and distribute highly targeted email marketing newsletters and campaigns to their subscriber and customer databases.

Adams’ company, Arial Software, is a tad different from the others in that they manage email marketing through a piece of software one would install on a computer, as opposed to developing and managing email marketing campaigns through an online service.

Adams said to set a customer’s expectations as to email frequency, size and purpose. Then, Adams added, the company’s behavior needs to be “congruent” with the customer’s expectations. The absolute worst thing that could happen is that a customer signs up for your newsletter, and then you send him sales emails, how-tos, partner offers, etc. The customer’s expectation was that he’d get a newsletter, and – in this example – the company has taken advantage of the customer. You’ll turn off that customer permanently. It’s a certainty.

However, it’s overly simplistic and imprecise to act as if anybody who happens to be willing to receive your email is a target customer. Not necessarily true. So, how do you know which people on your mailing list are potential buyers? It’s hard to know up-front. However, by gathering the proper information, you can tailor your messages to customers in such a way that you maximize the potential for a conversion. Adams stressed forgetting about demographics. Leave the age, the height, the weight, gender and income behind – and get to know why this customer is subscribing to your emails. “I’m a strong believer in learning ‘whys’ and segmenting your list,” Adams said.

If you sell shoes, for example, this means not concerning yourself with the customer’s shoe size and becoming passionate about why the customer wants shoes.

Goodman’s advice was pretty spot-on with Adams’. “The more relevant the communication, the more likely the response,” she said.

McDonald agreed, and cited some research. “According to recent analysis by Jupiter Research, despite additional campaign costs, relevant campaigns increase net profits by an average of 18 times more than do broadcast mailings,” he said.

After you garner a customer’s permission, set expectations and learn why he or she is interested in your product, what can you offer this person via email that will maintain interest, engage the customer and – eventually – result in a sale.

Goodman suggests maintaining offering relevance. Don’t offer iPods to folks visiting a sporting goods store. Forget trips to Miami for visitors to a classic country music site.

Offer something closely related to your business. How about a new set of golf clubs at a sporting good store? How about a trip to Nashville for those classic country music Web site visitors? Offer coupons. “Coupons are a terrific driver,” Goodman said.

On the other hand, offering relevant information is just as powerful. White papers. Tutorials. Discussion forums led by experts. Scheduled chats led by experts.

The execution portion of email marketing campaigns is outside the scope of building a successful mailing list, although to maintain a high number of targeted customers, you’ll need to consider the type of information you offer customers.

If you meet the customer’s expectations, you can in turn expect to create a relationship that grows. If you violate expectations, you can count on ruining the relationship with a potential customer.

However, sometimes you just have to get some names — some people with whom to communicate. Our executives agreed that a call-to-action, pointing people to your email communication sign-up page should be everywhere – on every page of your Web site, on a sign in your store; heck, maybe even on your business cards. “Put it everywhere,” Goodman said.

Goodman noted that most interactions between company and customer happens offline, so encouraging people to sign up for your mailing list outside the Web site environment is smart business. She recommended having a guestbook inside your brick-and-mortar store, and to even make signing up for mailing lists part of phone calls.

Adams said that the primary problem in getting people to sign up for a mailing list is that “they didn’t know where to go.”

Goodman’s suggestions for gathering emails are echoed by the other executives. “From point-of-purchase, to shopping carts, order confirmations to your call center, incorporate a means to gain permission from prospective and existing customers to communicate via ongoing emails with them,” McDonald said.

The executives stressed a quality-over-quantity approach to building email mailing lists. However, communication saturation is the primary way to build up your mailing list numbers, if that’s what you care about most.

The eventual success of your mailing list, however, is in how well you meet the expectations of those folks who entrusted you with their email addresses.

Practical Ecommerce

Practical Ecommerce

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