Understanding e-Mail Marketing

Measuring Your E-Mail Campaigns

As I mentioned, aside from price, the single biggest advantage of e-mail campaigns is the speed and ability with which you can measure results. Mail, at least in the US, is pretty speedy. Typical delivery is 2–3 days for most classes of mail. The difference between that and the few hours it might take to send an email isn’t terribly significant. And the design process for an e-mail piece vs. a printed piece is about the same length. You do make up some time by removing the need for printing; and you make up some additional time for follow-on pieces (where making changes to your electronic copy is much quicker than making changes to a printed piece), and when all is said-and-done you can easily be looking at a one day turnaround for emails vs. a one week turnaround for traditional mail. But that isn’t the important part of the speed difference. The important part is the speed with which you can measure your results.

I’m a big believer that all marketing efforts should be measured. But some things are easier to measure than others. Consider, how would you measure the effectiveness of a traditional mailing campaign? The most common way is by making the mailer a coupon. Then, whenever someone comes in with the coupon, that counts as a success. At some point in the future, you tally up the number of coupons that came in, divide by the number of pieces, and voila! You have your success rate for your direct mail campaign. Of course, the important part of that is the “at some point in the future” phrase. Exactly how long do you wait before you tally your results? A few weeks? A month? And, of course, there’s no way to know the indirect results of the campaign (how many people came into your store because of the coupon mailer, but didn’t remember to bring it?).

Now, you may argue, how is that different for e-mail? Assuming you don’t actually sell your product on-line, it may take just as long for someone to come in with a printed version of the coupon, and there may be just as many people who come in and forgot to print the coupon. True. But e-mail marketing gives us far more things to measure than just the conversion rate. If you’re working with a good e-mail marketing firm, then they’ll provide at least the following metrics:

  • Bounces
  • Unsubscribes
  • Opens
  • Forwards
  • Clicks-through

“Bounces” are the electronic equivalent of returned mail. The email address you’ve used is not (or at least is no longer) valid. “Unsubscribes” are people who have actively requested that you no longer email them. “Opens” are people who actually opened your email message. “Forwards” are people who sent your message on to friends. And “clicks-through” are people who clicked on a link in your message and came to your website.

These metrics give you far more insight into customer behavior, and the success of your campaign, than you can possibly get through direct mail marketing. For example, how many of your direct mail pieces are thrown into the trash before they’re even read? Wouldn’t you like to know that? It speaks directly to the quality of your message as it relates to your target audience. There’s a big difference between 90% of your target throwing your piece away and 70% throwing it away. By looking at the number of people who open your e-mail, vs. the number that don’t, you have instant access to this information — and you can try modifications to your message to improve it. Often times, this is as simple as changing the subject line. And of course, knowing that a certain subject line increases the percentage of recipients who actually read the message from (for example) 10% to 30%, is incredibly valuable information. Before you go spending 20x or more on a direct mail piece, wouldn’t it be nice to know that your bold heading on the postcard is the most effective it can be?

And what about that “bounce” rate? Imagine that instead of buying 10,000 email addresses from a list company, you bought 5,000 each from two different list companies. Of course, how much a name costs depends on how targeted your list is, but let’s assume that you’re purchasing names for 20¢ each. If one list has a 10% bounce rate, and the other a 20% bounce rate, then you’ve not only saved $100 on that initial purchase, but you will be saving 10% on every purchase in the future by choosing the better list provider. How long would that take you to learn with direct mail? In fact, each one of these metrics can be used to make your marketing campaign not only more cost effective, but also more effective in total.

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