E-mail List Rentals: Red Flags and Results

In my last column, I introduced you to a small consumer goods company with some big plans for boosting sales during the holiday season. The president of the company, who we’ll call Bill, was just embarking on a multieffort marketing campaign to a third-party e-mail list.

Last time we talked about what Bill was told about the list, including price as well as anticipated open and click-through rates. I cited some red flags. Today we’ll cover the result of his sends.

Bill’s first e-mail went out just before Thanksgiving — prime time for gift marketers. When I inquired about how it was doing, he responded, “A disaster thus far. One sale so far, and not attributed to the campaign…because they used a coupon from a coupon site. The [Web analytics] stats are not even on the map… It makes we wonder if the blast even happened.”

To help Bill out, I did a quick, very basic deliverability check, using the IP address and domain that the e-mail was sent from. My results were three for three. Senderbase.org, ReputationAuthority, and BarracudaCentral.org all showed deliverability issues.

On Senderbase.org (run by Cisco), the server’s e-mail reputation score was “poor,” which is defined as “a problematic level of threat activity has been observed from your IP address or domain. Your e-mail or Web traffic is likely to be filtered or blocked.”

ReputationAuthority reported a high rate of spam (74 percent of all e-mail sent) coming from the IP address and noted that it appeared on four DNS block lists hosted by BorderWare (the company behind ReputationAuthority). It also showed that the e-mail from this domain name was being sent from four servers, with reported spam rates of 77 to 95 percent.

The check on BarracudaCentral.org (run by Barracuda Networks), confirmed that the IP address had a “poor” rating and noted that Barracuda was blocking the domain that the e-mail was sent from.

Bill didn’t believe the e-mail had been sent; my research suggested that it had, indeed, been sent, but that little if any of it had been delivered.

When Bill presented this information to the list company, the IT person responded, saying she was “alarmed” and would do some of her own research. She wondered “how [the e-mail] could be detected as spam if the people have opted in with them.” She said she spoke to someone at Barracuda who told her that e-mail from reputable companies are often “spooked” (I think she meant “spoofed”) and that this could be causing the deliverability issues. All true, but understanding spoofing doesn’t help the e-mail get delivered.

For his second send, Bill asked that he be able to review the Web sites I listed above and choose the server/IP address that would be used. The list company agreed, although he was later told that this was “unheard of.” He chose a server with a “good” reputation.

The second send had results similar to the first. No sales, no increase in Web traffic, no return for Bill’s investment (which was significant for his business). When I checked the reputations of the IP address and domain after the send, they were back to “poor,” suggesting further deliverability problems.

The list company finally provided some basic metrics. Instead of the 12 to 18 percent open rate it had cited in its initial offering, Bill’s e-mail got open rates of 0.43 and 0.18 percent. The click-through rates were 0.05 and 0.04 percent, a fraction of the 11 to 21 percent rates he was quoted by the list company.

When asked, the list company blamed Bill’s e-mail creative, but they had no suggestions for improvement. I reviewed the subject line and creative for both sends; it was good stuff and incorporated e-mail standards and best practices. With a good list, it should have delivered traffic to the Web site, if not sales; with a poor list and/or deliverability issues, it doesn’t really make a difference what you send.

Bill was told that after the initial sends, he could download the list, load it into his own e-mail service provider (ESP), and send from there. I discouraged him; all legitimate ESPs require lists be opt-in. This list, where people opted in to receive e-mail from a third party (as the list company claims, we have no proof), not from Bill, doesn’t meet that criteria. If he receives spam complaints, he could be kicked off his ESP — and he could have trouble finding another ESP to take his business.

Key Lessons

• Buyer beware when it comes to third-party e-mail lists.
• Always test a small portion of the list (10,000 to 20,000 names) before you commit to renting the entire list.
• If the pricing seems too good to be true, it probably is.
• Legitimate list rental companies don’t turn over the e-mail addresses to the sender — ever.
• Be certain you are familiar with e-mail terminology, and confirm that the company you’re dealing with understands it as well.
• Be skeptical. If you’re quoted results that appear to be “pie in the sky,” question them.
• Build a deliverability clause into any list rental contract. If the servers or domain name they are sending from is blocked, be sure you have a money-back guarantee so you don’t pay for e-mail that’s not delivered.

No list company will guarantee results. But the best ones know the rules of the e-mail road and abide by them. Protect yourself to avoid spending good money for bad results.

Happy 2009!

Jeanne