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2013 Year in Review: Email Marketing Winners & Losers

  |  December 4, 2013   |  Comments

Before everyone gets their predictions in for 2014, can the email ecosystem take a quick victory lap? Columnist Dave Hendricks shares his picks and pans from notable events in email marketing over 2013.

shutterstock-149842271Before everyone gets their predictions in for 2014, can the email ecosystem take a quick victory lap?

Was 2013 The Year of Email?

What happened in 2013 that kept email as undisputed killer app of the internet? These are the events that stood out for me. Add yours in the comment section.

2013 Innovation Winner: Google's Tabbed Inbox

Inbox innovation was a really big deal in 2013. Google's new tabbed user experience really got the market excited, and in some cases agitated.

Using its GOOG-given right to filter users' mail based on its own algorithms, Gmail introduced what some considered a radical challenge to deliverability orthodoxy by slotting users' mail into three default and two additional tabs.

Similar to changing their search engine algorithm, this modification to the user experience created much consternation among ESPs and brands that had worked hard to earn their way into the previous innovation -- the priority inbox -- but created less reaction and hand-wringing from the true clients of the inbox, the email users. The biggest innovation within this innovation? The new ‘search-like' emails that weren't sent by a brand, but rather placed by Google like a paid search ad.

The Winning Takeaway: What took Google so long to figure out that clicking into Gmail, then into the Promotions Tab was ‘distilled intent?' The inbox is a natural place to run targeted ads that are sure to be seen by an audience of openers and clickers. Placing an ad into the inbox isn't foreign, since after all, what is an email marketing message if it is not an advertisement aimed at its customer?

2013 Innovation First Runner Up: Facebook's Custom Audience

After getting more than 1 billion people to give them their email addresses at sign-up and sign-in, Facebook figured out that brands might want to market to their exact email-registered customers who were spending time on Facebook. Duh!

Custom Audience, a simple way of customer matching using the MD5 hash of the user's email address (or a phone number), has been used by thousands of companies as a way to market directly to their customers when those customers are ‘spending time' on Facebook. This is accomplished by matching the logged in users' Hash IDs to the file uploaded by the marketer. Add creative, budget, and a bid and you have a serious one-to-one marketing tool.

The Custom Audience program has been so successful that Facebook is now expanding it to smaller businesses.

The Runner Up Takeaway: Your email addresses are valuable beyond your first party newsletter-based email campaigns. If they aren't reading your emails, you can use Hash IDs to find them on an increasing number of custom audience platforms that support this standard. This will be available on Twitter and other social services before too long. Don't be the last to introduce this tactic to your clients and co-workers.

2013 Second Runners Up: Salesforce, Oracle & Adobe

... and other smart companies that bought email technology companies this year. The innovations introduced by GOOG and FB led to a photo-finish with the winner and runner up. These three legacy tech companies combined to spend almost $4 billion dollars respectively acquiring ExactTarget ($2.5 billion), Eloqua ($871 million) and Neolane ($600 million).

With worldwide email users exceeding 4 billion and growing, investing $1 per addressable user in the 'technology equivalent of water' is a smart and long-term choice. It takes a long time to build an email technology company and when they hit scale and execute, email tech companies tend to be very disruptive and hard to displace. High switching costs and the strong secular trends favoring email make these investments much safer and remunerative than buying flashy social companies that are subject to the vagaries of platform policies.

If you are the CFO of a public tech company what would you rather own - ExactTarget or SnapChat? And as an added bonus, Adobe has tried to up-end the ESP pricing model by eliminating CPM sending charges. Take that old business models!

2013 Second Runner Up Take-Away: With fewer email technologies available for acquisition on the open market, buying these companies now was a smart move, as they were still relatively cheap. Other fully-scaled companies that are still available for digestion include SilverPop, Responsys and Constant Contact. Do you think email is going away? Since CRM is email, these are great plays by smart companies.

2013 Razzy: Dropbox's Acquisition of Mailbox App

Dropbox, the essential tool for anyone who ever saves a file and needs to get it later from wherever, spent $100 million to acquire a mobile-only email iOS app that only works with Gmail. Yes, you can press a snooze button on your messages. Is that really worth $100 million?

2013 Razzy Take-Away: Most people I know have more than one email address. If your single platform email app can't hook up with Yahoo, Apple, Gmail and Exchange then you are not ready for email prime-time. Love the concept, can't live with this limitation as long as my email life isn't one-dimensional. Bonus Razzy points go to Drew Houston (who didn't invent cloud-based storage) claiming that there hasn't been innovation in the inbox. Hasn't he seen the new Yahoo Mail client?

Email will continue to be the glue of the internet. As long as the email address is the lingua franca of internet access and identity, expect email companies to be at the forefront of innovation... and acquisition on the buy and sell side. Acquisition and innovation will continue as long as Email Is the Center of the Addressable Customer Universe

Title image courtesy of Shutterstock

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ABOUT THE AUTHOR

Dave Hendricks

As president of LiveIntent, Dave Hendricks has overall responsibility for revenue, finance, legal, and operations. Prior to joining LiveIntent before its 2009 Series A, Dave was EVP of operations at PulsePoint (then known as Datran Media), where he worked with LiveIntent founder and CEO Matt Keiser and ran Datran's ESP StormPost. Before all that, Dave held senior roles at data management companies InfoUSA and Experian. A member of the founding executive team at ExperianCheetahMail, Dave began his email adventure at Pioneering ESP MessageMedia after running global partnerships for Oracle Corp. Dave was named one of Silicon Alley Insiders Top 100 technologists in 2011 and is active in several IAB Committees including Mobile and Email. Follow him on Twitter @davehendricks.

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