An exact return on investment can be tracked ("track to basket") and has proven
to be high when done properly. E-mail Marketing is often reported as second only
to search marketing as the most effective online marketing tactic.[2]
Advertisers can reach substantial numbers of e-mail subscribers who have opted
in (i.e., consented) to receive e-mail communications on subjects of interest to
them.
Over half of Internet users check or send e-mail on a typical day.[3]
E-mail is popular with digital marketers, rising an estimated 15% in 2009 to
£292m in the UK.[4]
Disadvantages
A report issued by the e-mail services company Return Path, as of mid-2008
e-mail deliverability is still an issue for legitimate marketers. According to
the report, legitimate e-mail servers averaged a delivery rate of 56%; twenty
percent of the messages were rejected, and eight percent were filtered.[5]
Companies considering the use of an E-mail Marketing program must make sure that
their program does not violate spam laws such as the United States' Controlling
the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM),[6] the
European Privacy and Electronic Communications Regulations 2003, or their
Internet service provider's acceptable use policy.
Opt-in e-mail advertising
Opt-in e-mail advertising, or permission marketing, is a method of advertising
via e-mail whereby the recipient of the advertisement has consented to receive
it. This method is one of several developed by marketers to eliminate the
disadvantages of E-mail Marketing.[7]
Opt-in E-mail Marketing may evolve into a technology that uses a handshake
protocol between the sender and receiver.[7] This system is intended to
eventually result in a high degree of satisfaction between consumers and
marketers. If opt-in e-mail advertising is used, the material that is e-mailed
to consumers will be "anticipated". It is assumed that the consumer wants to
receive it, which makes it unlike unsolicited advertisements sent to the
consumer. Ideally, opt-in e-mail advertisements will be more personal and
relevant to the consumer than untargeted advertisements.
A common example of permission marketing is a newsletter sent to an advertising
firm's customers. Such newsletters inform customers of upcoming events or
promotions, or new products.[8] In this type of advertising, a company that
wants to send a newsletter to their customers may ask them at the point of
purchase if they would like to receive the newsletter.
With a foundation of opted-in contact information stored in their database,
marketers can send out promotional materials automatically. They can also
segment their promotions to specific market segments.[9]
Legal requirements
In 2002 the European Union introduced the Directive on Privacy and Electronic
Communications. Article 13 of the Directive prohibits the use of email addresses
for marketing purposes. The Directive establishes the opt-in regime, where
unsolicited emails may be sent only with prior agreement of the recipient.
The directive has since been incorporated into the laws of member states. In the
UK it is covered under the Privacy and Electronic Communications (EC Directive)
Regulations 2003[10] and applies to all organisations that send out marketing by
some form of electronic communication.
The CAN-SPAM Act of 2003 authorizes a US$11,000 penalty per violation for
spamming each individual recipient. Therefore, many commercial e-mail marketers
within the United States utilize a service or special software to ensure
compliance with the Act. A variety of older systems exist that do not ensure
compliance with the Act. To comply with the Act's regulation of commercial
e-mail, services typically require users to authenticate their return address
and include a valid physical address, provide a one-click unsubscribe feature,
and prohibit importing lists of purchased addresses that may not have given
valid permission.
In addition to satisfying legal requirements, e-mail service providers began to
help customers establish and manage their own E-mail Marketing campaigns. The
service providers supply e-mail templates and general best practices, as well as
methods for handling subscriptions and cancellations automatically. They also
provide statistics pertaining to the number of messages received and opened, and
whether the recipients clicked on any links within the messages.
The CAN-SPAM Act was recently updated with some new regulations[clarification
needed] that went into effect on July 7, 2008.