E-Mail Marketing History Lessons

  |  October 2, 2008   |  Comments

The move into new online media such as SMS, RSS, and social networking shows signs that some are repeating yesterday's mistakes.

When my company was founded 10 years ago, we believed the future for direct marketing was in highly integrated, customer-driven, one-to-one marketing and that e-mail could enable that future in a way no other medium could.

Fast forward to today: I've been reviewing and updating my company's mission statement. While we're gratified that our vision holds up today, it brought to mind some wisdom gleaned over the past decade.

In 1998, there were two pieces of conventional wisdom in e-mail marketing.

"Batch and Blast"

There was a massive land grab going on among venture capital funded startup e-mail service providers (ESPs) to gain as much market share as possible. This was driven by the new economics of the dot-com bubble. Obtaining market share was considered far more important than being profitable and building a solid business.

This has had several effects, some of which are still being felt today. The fire sale prices and constant undercutting have resulted in e-mail being highly commoditized to the extent that many ESPs struggle to maintain profitability (a concept that regained importance after the dot-com bubble burst).

This is perhaps most evident in the constant stream of industry luminaries bemoaning how undervalued e-mail marketing is.

The land grab also led to volume-oriented systems. It was an approach that mimicked Jack Cohen's "pile 'em high and sell 'em cheap" mantra. Send as much e-mail as possible as often as possible to as many people as possible. List hygiene, deliverability, segmentation, personalization, and recipient preferences were afterthoughts.

Deliverability troubles continue today, even among the largest service providers. Companies that should have impeccable reputations as standard bearers are still viewed as spam enablers by many in the industry due to past indiscretions.

Well-targeted, personalized e-mail communications are only beginning to gain traction. Many organizations still don't do even minimal segmentation of their "blasts." The constant barrage has also reduced the efficacy of the medium and increased e-mail fatigue.

E-mail Integration

The incredible ROI (define) of e-mail was supposed to turn it into the medium of choice, and essentially replace traditional direct marketing almost entirely. Clearly, that was a shortsighted perspective.

However, that thinking has caused a significant siloing of e-mail. Systems often weren't developed to integrate effectively (why integrate with something you're making obsolete?). Separate teams grew up to support e-mail. Integrating the online and offline marketing specialties remains a challenge in many organizations. The need for, and value of, integration can be clearly seen in the purchase of so many e-mail service providers by direct marketing and database companies.

Why the History Lesson?

We must all keep in mind what philosopher George Santayana famously said: "Those who cannot remember the past, are condemned to repeat it." As we move into new online media such as SMS (define), instant messaging, RSS, social networking, and others, let us not forget the past but learn from it.

Unfortunately, it looks like some are making the same mistakes again. Even though the telecom companies are working hard to enforce good list practices for SMS, we've already seen some companies blasting marketing messages to millions. Also, I keep seeing claims by proponents of RSS that it will replace e-mail rather than complement it, just as 10 years ago there were claims that e-mail would replace direct mail.

It never should've been about batch and blast. Any new medium is highly unlikely to replace either traditional direct marketing methods or e-mail.

We must take the time to study and understand the strengths and weaknesses of each new medium, learn how people use each medium, and the social dynamics involved. Only then can we understand how best to use it to augment and enhance the user experience by providing highly integrated, customer driven, one-to-one communications.

Until next time,

Derek

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ABOUT THE AUTHOR

Derek Harding

Derek Harding is the CEO and founder of Innovyx Inc., a member of the Omnicom Group and the first e-mail service provider to be wholly owned by a full-service marketing agency. A British expatriate living in Seattle, WA, Derek is a technologist by background who has been working in online marketing on both sides of the Atlantic for the last 10 years.

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