Pay-for-performance ad network ValueClick this week said it was moving into the email marketing business.
“We’ve known there’s been a need for some time in the industry,” said ValueClick vice president of marketing John Ardis. “We held back to get a handle on what our advertisers wanted to see.”
Through new email marketing offerings, ValueClick hopes to provide “a truly multifaceted solution to advertisers and marketers who want to leverage online media,” said chairman and chief executive Jim Zarley.
It also lets the Westlake Village, Calif.-based company tap into one of the industry’s current hotspots. With investors bearish on banner advertising, and questions persisting about its effectiveness, email direct marketing is coming into its own. DoubleClick this month announced two major investments to boost its email capabilities, snapping up email marketer NetCreations and placing a sizable investment in email technology firm Return Path.
“With high response and conversion rates, opt-in email is recognized as one of the most powerful online marketing tools available today,” Zarley said. “Our customers expect leadership from us in every category, and adding email to our suite of products further demonstrates our total commitment to superior marketing performance.”
ValueClick isn’t wasting time, either. After a brief beta testing period, the company went live with its email business and access to a whopping 25 million addresses.
While Ardis declined to name his email and newsletter partners, he is quick to point out the privacy and performance concerns the company has addressed.
“We’re partnered with a number of high-quality list vendors,” he said. “We surveyed 50 or more and settled on about 15 or 20 that we feel meet our standards of stringent opt-in requirements to protect privacy and who have frequency capping [that is, limiting the number of messages a user receives to limit message burnout and clutter] to appease privacy and performance.”
“We’re only allowing very stringent guidelines,” which Ardis said includes near-100 percent double opt-in addresses, and a frequency cap of about one message per week per user. “And we go to pretty great lengths to make sure they can opt-out at any time.”
ValueClick will leave the serving to its email partners and will focus on targeting; in addition to freeing ValueClick from the technology burden of delivering millions of emails, Ardis said the arrangement ensures that the its partners, and not ValueClick, has access to the addresses.
“We don’t own those names, and when a consumer opts in, they expect that vendor to hold those names closely,” he said.
Ardis said the company eventually will move into acquiring its own database of double opt-in addresses, through purchasing lists, promotions and sweepstakes, and offering free Web-based email — with opt-in requirements to targeted messaging — through its publishing affiliates.
“I think over time it will become a very major contributor to our business,” Ardis said. “Despite all the options out there in the marketing space for email there’s still a huge demand for it and a huge response. We look at it as a value-added service for our customers, as well as a new revenue stream for ValueClick.”
In addition to email promotions, ValueClick offers newsletter advertising as well, through a similarly unspecified agreement with undisclosed publishers. While several companies like PennMedia specialize in email newsletter marketing, Ardis however said that business is making up “by far the minority” of ValueClick’s new email practice.
“It’s predominantly solo [promotional mailings]. We do a little bit of newsletter work. But a majority of demand and results are in solo. Their highly targeted messages are getting better results for advertisers.”
“To have a well-rounded program, we felt like we needed” newsletters, Ardis said. “We’re not finding as great as performance with the newsletter as we are with the solo. It’s still an effective marketing tool, but the performance isn’t as great as with solo.”
ValueClick’s Thursday announcement follows several moves into other hot areas. Its introduction last month of pay-for-performance wireless advertising through its subsidiary ValueClick Japan and a deal with Japanese wireless technology company NTT DoCoMo makes ValueClick the first all-CPA/CPC wireless player (though the service is available only in Japan). And earlier this month, the firm acquired Straight Up!, a marketing analysis firm.
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