You may have already discovered that renting someone else’s opt-in email list can be a successful email marketing tactic. Let it do the work of recruiting addresses and managing the database, you say; all you need to do is hand over some of your hard-earned dollars to have access to tens of thousands of potential customers.
Last week, we showed how SmarterKids.com is using a third-party opt-in email program to enlarge its customer base. This week, we’ll take a look at another successful email marketing program that relies on third-party membership in MyPoints.com, a loyalty/incentive marketing program.
OurHouse.com is a “destination web site for individuals concerned about homes” that focuses on four main areas: selling products, offering advice, fostering community, and informing about services. When the site launched in November 1999, it teamed up with MyPoints.com to conduct an email marketing campaign. And with results such as a conversion to purchase that is “at par if not better than other means,” according to Bill Morreal, Manager of 1-1 Marketing, it’s no surprise OurHouse.com continues to send out regular mailings with MyPoints.
MyPoints.com is a group of 8 million consumers (soon to be 15 million once it completes its merger with Cybergold) who join the MyPoints community in exchange for shopping incentives. Members earn points for shopping with certain merchants or for responding to targeted email offers, and they can spend those points with merchant redemption partners.
On the email marketing side, one key feature MyPoints offers merchants is the ability to send out “soft-offer” registrations, whereby consumers are awarded points for visiting merchant sites and, in some cases, registering for the site or a newsletter. Another type of offer revolves around purchases, whereby email recipients receive more points and possible discounts for ordering from a site.
OurHouse.com has taken advantage of both types of offers, and Morreal says both are working well. When it first began the third-party mailings (and keep in mind that the company never sees MyPoints email addresses unless an email recipient later voluntarily hands over contact info when, say, making a purchase), OurHouse.com focused on encouraging registration. A recipient would click through to a site, receive 10 points, and then possibly stick around on the site and register. Primarily through this approach, OurHouse.com was able to bring in 10,000 new members in a recent campaign.
As you might expect, when you dangle 10 points in exchange for a mouse click in front of a MyPoints member, the click-through rates can be quite high; MyPoints Executive Vice President Chaz Berman notes that the rates approach 20 percent. But, you may be asking yourself, does this really mean individuals are interested in the site, or are they just clicking for the sake of a few points? (As a MyPoints user myself, I know I sometimes click through and don’t wait for the site to pop up. All I’m looking for are my points, and then I’m on to something else.)
But the proof of effectiveness, Morreal says, is obvious when you look at the conversion rates. Yes, OurHouse.com does see “lots of exits off the home page,” but he adds that although the recipients may not always turn into loyal customers, the ones who do become valuable people to mine. OurHouse.com conversion rates are slightly greater than one percent.
Another indication that MyPoints.com offers loyal members is a May 2000 Media Metrix study that shows visitors referred by MyPoints.com are half again as likely to return to those sites again than visitors sourced through other media, contributing to higher long-term retention levels.
To see what this means in practice, consider a recent OurHouse.com campaign. The company sent out email messages to MyPoints members offering 1,000 points for any purchase over $30. Within a two-week period, this campaign generated close to 1,060 sales, with an average of about $40 per sale or almost $43,000 total.
Since OurHouse.com is now moving to a business model where it buys a guaranteed number of click-throughs (the company used to buy a number of messages straight out), OurHouse.com can use these numbers to derive a fairly accurate prediction of cost. And it’s one that satisfies OurHouse.com.
“The MyPoints cost per order is lower in this group than in others,” Morreal says. “We know what we’ll pay for bringing in a certain number of customers within a given time period.”
So in the future, you can expect to see OurHouse.com continuing to send out offers to MyPoints members. Plus, the company is looking at other ways to team up with MyPoints, including becoming a redemption partner.
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