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How to Reach the Top of the Inbox

  |  July 26, 2002   |  Comments

Hint: It’s going to cost you!

Getting on top of your email -- making sure it gets there -- is becoming as hard as it once was to get on top of the search engine listings. With all the new spam filtering going on, affiliates using email marketing are forced to adapt to rapidly changing rules set by a few networks.

Now you can pay to get on top of most major search engines through Overture, FindWhat.com, LookSmart, and others that charge a fee to put you on top of the listings. Email is heading in the same direction, driven by the same companies charging for search engine positions.

Just a few weeks ago, I wrote about charging a fee for email. Now I’m discovering I was wrong. We are already getting charged, literally, and it is just the beginning.

The bulk of email is controlled by a few major companies: Yahoo, MSN, Excite, and AOL. These are the major email networks, and right now most do not do much about email -- other than shut you off if you send too much volume or if you word your message in a spam-like manner. In many cases, users are left to futz with filters.

Though software can stop spam, it’s way too complicated for most users. Unfortunately, the problem has gotten to the point where people have to put these controls into place to protect themselves. As I’ve written before, direct email is becoming like direct mail, and it’s taking a toll on the Internet community because of the incredible volume of email being sent. I’d envisioned a scenario of marketers paying one centralized, Network Solutions-like provider to make sure their messages are delivered. Instead, businesses are paying the networks for access to their customers.

The days of cheap email are over, and the stories are starting to circulate. For example, if you want to get your email into AOL, you’ll have to pay. We’re talking about companies paying CPM rates just to get email through to AOL.

Word on the Net is certain companies gain access to a rumored whitelist of approved AOL email vendors by adhering to certain standards. Knowing AOL, it is likely a laborious process of hoop-jumping, which people will go through to reach the masses of AOL users. Rumor also has it your domain and IP are put on an approved list, which should mean your email will always get through.

I called a couple of folks at AOL, including the company’s official spokespeople, to ask about the rumors and hadn’t heard back by press time. So, some of what I’m writing is based on what I’ve heard, and some is based on speculation. Take it with a grain of salt, but I do believe companies will soon be charging for access to their users, even if they aren’t now.

Still, even if you pay for access to users, it doesn’t mean you’ll get sales. The mass spammers are continually finding ways around everyone’s rules. The competition for people’s attention remains the same, but dollars are being added to the equation.

AOL simply has too many subscribers for direct emailers, and affiliates, to ignore. So do Yahoo, Hotmail, and Excite. Their user bases are huge, and you need to get through -- even though you know many of these addresses are dead, unresponsive, or never really existed in the first place.

The promise of payment is you will finally reach your end user, but at AOL, for example, the game is not that simple.

It’s an extremely risky proposition, and, even with admittance, open rates at AOL are 5 to 10 percent at best. So, if I send 1 million emails, I expect 50,000 might open the email -- a good 5 percent rate (and they go really low on AOL, as low as 0.2 percent, which simply means no one on your list is really out there).

If my click through is 1 percent (high for marketing lists, low for information lists), I get 500 clicks. Then, if 1 percent convert, I make five sales. I hope I’m making a ton on those five sales!

Could I increase my click through and conversion? Definitely. But if I’m paying a $2 CPM, it costs me $2,000 just to get through to AOL users. At a $5 CPM, it would be $5,000. That would be on top of all my other costs of delivering email.

Can I increase my open rate? Not likely. You can play games, but games don’t help sales. We are settling into numbers that remind folks of direct mail, and it is only getting worse.

The email marketing business is moving away from those email lists boasting 10 to 50 million names and moving toward good, smaller lists built on targeting. Of course, those lists don’t mean much if you can’t get your email through. Here’s what I expect from the main email providers in the future:

  • AOL. The online leader knows bandwidth costs money. Why turn away millions of emails when you can charge anywhere from $2 to $5 CPM just for access? But the open rates generally suck. Most folks I know skip AOL all together, white list or no. Those who’ve been accepted still feel screwed because even then the email doesn’t get through or generate response -- an AOL tradition.

  • Yahoo What AOL does, Yahoo is soon to mimic and most likely improve. Yahoo chucks email it designates as "bulk" into a special folder. What’s the price to get out of the bulk folder? You tell me, but I get a feeling Yahoo will soon tell both of us. Then, it’ll opt in their users to that option. ;-)

  • Hotmail. Its volume limit and spam controls are excellent, and it has a real opportunity. For example, Hotmail could give users a free year of advanced service just for allowing approved direct emails to go through. By making the ads scarce, the value would likely be higher. Do some basic data mining and you could easily build an opt-in model around the likes of the user.

  • Excite. These folks have spam filters on full power. It only makes sense for them to charge. At it stands now, you can barely get through 100 messages an hour.

Most of my recent articles have covered email for a reason. While all the pundits argue about standards, it’s butt ugly out in the trenches, especially when you’re marketing through email. Email has long been a preferred method of super affiliate marketing, but the line between super affiliates and spammers is becoming less apparent.

Good businesses are getting screwed by outside forces they cannot control. We all know the story of spam, ad nauseam. I’ll spare you my opinion. What’s important is to see how the world of email is changing now, largely because of the influence of spam.

From now on, you will have to pay admission to reach users in a network. Yet, you must make sure the cost of that admission has some benefit. Right now with AOL, there is little benefit.

The company that turns this problem into a benefit wins the game, because, in the end, we will pay. Today we get on top of the search engines by paying for placement. Tomorrow we will pay to get on top of email boxes -- but until a benefit is associated with that cost, it will not provide value. Either way, you’re going to pay.

Join us at ClickZ E-Mail Strategies in Chicago on Thursday, August 8.

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ABOUT THE AUTHOR

Declan Dunn Declan Dunn is CEO of ADNet International, a direct marketing services provider that focuses on select projects and its own super affiliate network, including the Net Profits business training systems delivered at ActiveMarketplace.

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