Hey, E-Tailers: Wake Up!

Forty-three days into CAN-SPAM, and results are highly predictable. Law-abiding marketers have worked overtime to ensure all their messages comply with the new law. The dark side: pornographers, deceitful Viagra cloners, and get-rich schemers have lost not one wink of sleep. Regular readers know I supported CAN-SPAM all along but cautioned those with expectations that the law alone would expel all spam from the inbox.

At the World Economic Forum in Davos, Switzerland, Bill Gates, a guy who knows a thing or two about making money, echoed the belief a financial solution is the only way to eradicate spam from mailboxes. His solution is to make spam unprofitable via a paid email system. With the pronouncement, I suddenly felt like all those fledgling software developers with really cool products that didn't find their way into Microsoft's offices. Now that Bill says it, it must be true.

Pundits who were passionate about CAN-SPAM are now resigned to the fact it won't end spam. Like children waiting for Santa Claus, they wanted to believe miracles would happen and everyone would just get along.

As I pound my fist on my desk, demanding "reputable" marketers' rights be protected at all costs, I worry about the state of direct marketing and an apparent lack of energy, creativity, passion, and plain old common sense regarding changing consumer purchasing dynamics. Many direct marketers' marketing strategies are caught in a time warp. Focused on staying the course and remaining true to their legacy, marketers are in grave danger of missing market shifts and losing valuable customers.

Wake up!

• The Internet is here to stay. If you believe the Internet is a passing fancy and consumers will ultimately embrace traditional channels, you're wrong. Take a look at the latest Jupiter Research (a unit of this site's parent corporation). According to Jupiter, online sales this year will reach $65 billion dollars, a 24 percent increase over last year. The Internet generation continues its online migration in record numbers.
  
  
• Postal rates will increase. Postmaster General John Potter recently warned that due to a number of factors, including a decline in postal mail volume, the U.S. Postal Service may be forced to file a "double-digit" rate hike in 2006. Already dealing with increased prices for paper and printing, catalogers are now faced with the grim reality postal rates may push CPMs into another orbit. Think: Margins are declining, and the cost of doing business continues to rise.
  
  
• Media consumption patterns have changed. As consumers with hectic schedules and numerous obligations, we're searching for more effective, efficient ways to get things done. Increasingly, consumers are gravitating to marketers who save them time and money accomplishing all types of tasks. The consumer simply doesn't have the time or energy to "work hard" to make a transaction happen.
  
  
• You really do know your customers. Most direct marketers have collected data on their customers for years. You have volumes of files that tracked every SKU and transaction they made. Yet so many of you treat your customers as strangers each and every time you speak with them. Put all that data to work. Build solid relationships with your customers.

As a consumer, I make most of my purchases through the direct channel. I believe I represent a silent yet powerful majority of consumers who are fed up with the fact retailers and e-tailers with whom we've done business for nearly 20 years continue, at every interaction, to treat us like new customers. My trash bin overflows with unsolicited messages from reputable marketers.

I know. You're thinking, "Why should we personalize?" It's so much cheaper to send everyone the same catalog or email. It costs time and money to create customized offerings. Those Girl Scout troops with recycling drives hope you guys never do get it.

Targeted marketing works. With email it's efficient and relatively easy to execute, as long as your provider and/or system has the capability.

According to a December 2003 Jupiter report, dynamic content dramatically improves results and lowers customer fatigue. The study found, depending on the complexity of such dynamically targeted campaigns, performance could increase four to eight times over the traditional batch-and-blast approach.

As consumers migrate rapidly to paperless email and Internet channels, they find refuge in knowing a simple tap of the delete key removes unwanted, unsolicited, and irrelevant messages from their inboxes. In this channel, smart, hard-working, forward-thinking marketers can actually use all the great data in their warehouses to construct email customer communications that are truly contextual.

Imagine sending email to your customers with dynamically generated offers that match their transactional profile. How would you feel if a vendor actually took the time to provide ongoing communication that focuses on exactly what you need and doesn't waste time or attention on products you don't want? This is how to drive performance and customer relationships while reducing opt-outs and spam complaints.

Most e-tailers use email in the same manner and method in which they use direct mail or catalogs. It's cheap, they reason, send more. No need to personalize or segment audience or offer. If you throw enough at the customer wall, some will hit the bull's eye. That may have worked in the old days, but the method is doomed to fail in the new consumer reality.

Unless you e-tailers grow up and start using customer data and information to craft meaningful dialogues, you'll succumb to the shifting tides of consumer preference.

'Til next time,

Al

Want more email marketing information? ClickZ E-Mail Strategies is an archive of all our email columns, organized by topic.