There are no shortcuts to building a good e-mail list. And list purchase, like e-mail append, is all about the shortcut.
My company has always focused on e-mail to internal house lists, where the client has a direct relationship with each recipient and each recipient has specifically subscribed to the client's list. Thus, I found this site from another e-mail service provider amusing, but largely irrelevant. Until recently that is.
It seems the economic downturn has caused many companies that would never have considered list purchase before to reconsider. More troubling for us is that many are going ahead without due care and attention to or awareness of the risks. Often we find out after the fact that a client has been using list purchase -- typically when we're investigating delivery problems for previously good lists.
Jeanne Jennings recently provided a cautionary tale regarding list rental. Sadly, the problem is far more severe with list purchase.
The difference between rental and purchase is that with rental you never see the addresses. The list owner sends on your behalf and retains full control of, and more important, responsibility for its list. With purchase, you actually buy the addresses, receive them, and use them how you wish.
Clearly, list management is at the heart of the problem. This is hardly surprising, as these days it's the root cause of most delivery issues.
The failure is in three key areas: obtaining appropriate consent, maintaining list hygiene, and meeting recipient expectations regarding content and frequency. This is true for rented-list owners sending to their own lists and for purchased lists sent to by the purchaser.
The consent problem starts with address collection and is especially severe for purchased lists. It's very similar to the e-mail append problem. Very few recipients knowingly agree to have their addresses sold. Every vendor claims its lists are opt-in, but the reality of what that means varies greatly.
The consent issues then make list hygiene even harder in an environment where list maintenance is already difficult. Selling the lists means that bounces, unsubscribes, and complaints rarely find their way back to the original list. The difficulty of obtaining good addresses also acts as a disincentive to ever remove any address with even the slightest chance of delivery.
The expectations issue is partly caused by the consent problem and partly by the nature of selling lists. It's hard to meet expectations that you didn't set or find out in the first place. When the list is sold, the sellers have no control over the frequency of use or the content involved. This leads to dissatisfied recipients and poor response.
Remember: when you purchase a list, you're associating your brand and its reputation with that of every other company that has ever purchased the same list. The net result is purchased lists' quality is generally low and response rates are typically poor.
The bounce and complaint rates on purchased lists from some of the most reputable companies in the industry are horrifying. A complaint rate greater than 2 percent is common. Extremely low response rates, like those Jennings quotes, are also common.
To compound matters, because you're sending to these recipients, your reputation is on the line. These are your IP addresses and domains being used. How many addresses are you prepared to burn on these lists?
If you, or your management, are dead set on list purchase, make absolutely certain that you go into it with your eyes wide open:
There are no shortcuts to building a good e-mail list. And list purchase, like e-mail append, is all about the shortcut. Hence I, like many e-mail service providers, don't recommend it in almost all cases.
Next time I'll focus on ways to build your list.
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Derek is the managing director of J-Labs, Javelin Marketing Group's technology skunkworks, a role that draws on his 20 years of experience and leadership in the fields of marketing and technology. A British expatriate based in Seattle, Washington, Derek is perhaps better known as the founder and technologist behind Innovyx, one of the first email service providers later acquired by the Omnicom Group. An industry veteran and thought-leader, Derek is a regular expert author, contributor, conference speaker, and takes an active role in a number of industry and trade groups.
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