Chapter 9 Email Marketing
In this online marketing environment firms are constantly looking for powerful and cost-effective tools to grow their customer base, engage with existing customers, and boost their sales. One such tool that firms are using in digital world is email newsletters. Email newsletters can be used by firms effectively to reach out their customers and communicate with them actively and regularly. Email is also asynchronous communication medium.
The importance of email can be highlighted as follows:
- Reminders: In an online selling environment abandoned basket by consumers is a major problem. Email newsletters can be used effectively as reminders to these customers.
- Information: Email newsletters can be used to convey consumers about new product offerings.
- Educational Tool: Email newsletters can be used as an educational tool to educated consumers about product usage or upcoming upgrades.
- Promotional Tool: Special promotional offers can be delivered to consumers using email newsletters.
- Engagement Tool: Email newsletters can be used by firms to manage customer engagement.
- Direct Marketing Tool: Emails newsletter can be used to sell directly to the consumers.
- Viral Marketing Tool: Emails newsletters can be used as an effective viral marketing tools if recipients forward the email to other users.
- Improved Marketing Efficiency: Given above, email marketing can have increased marketing success by improving brand image and building better customer relationship at a very inexpensive rate. It can also help multichannel firms to drive traffic to web-sites and measure its impact accurately.
The United States federal CAN-SPAM Act5 became law in January 1, 2004 that discourages commercial entities to send unsolicited email messages . Therefore, email marketing is consent based marketing tool i.e. before sending any marketing message to consumers/recipients firms need to seek active consent from them. The advantage of seeking permission is the marketing information delivered through email is anticipated, personal and relevant to the subscribed consumers. Some of the advantages of email newsletters over traditional media are as follow:
- Low production cost
- Low distribution cost
- Ease of creation - media richness
- User convenience and intractability
- Traceability
- Personalization/Customization
Some of the challenges of measuring success rate of email marketing are as follow:
- What are the different actions/responses/(dis)engagements through which consumers interact with an email campaign that affect its success and failure?
- How these different consumer engagements are related?
- What are the differential impacts of consumer engagements on sales generated through a particular email campaign by the involved consumers?
- How external covariates such as attributes of an email campaigns, situational factors and firms’ marketing mix affect these different consumer engagements and sales generated through a particular email campaign? \end{itemize}
Following are some of the important email marketing strategies:
Customer-centric Benchmarking: Digital technologies are interactive and the Internet facilitates real time interaction. Consumers interact with digital media used by firms as advertising tools distinctively. In order to benchmark the performance of these digital tools it is important to understand the nature of consumer interactions or responses from two perspectives. First, consumers’ responses to these digital tools provide an extent of their engagement and there could be an underlying structure to these responses understanding of which may provide firms with appropriate relationship marketing strategies. Second, these responses are not only critical in relationship building but may also affect sales. Thus, it is important to benchmark the usage of digital tools as advertising media in terms of consumer engagement.
Understanding the Characteristics of Digital Media: Different digital media have distinct characteristics. Furthermore, many of these characteristics can be customized to suit the preferences of users who are exposed to these media. Companies often introduce new product features to differentiate and gain competitive advantage. Similar strategies can be applied with respect to consumers’ digital media consumption by introducing or modifying features of digital contents. Digital media are used by consumers as a source of entertainment, engagement, interaction, shopping, and information search among others. The commercial use of digital media by firms should keep in mind that these tools should simplify consumers’ purchases or decision making process. Furthermore, different consumer responses are affected by these digital features differentially. Therefore, design of digital contents becomes critical for their effectiveness in engaging consumers.
Adaptation of Digital Media according to Business Needs: The Internet is ever growing and ever evolving. Thus, the digital communications used by firm in this internet age provide new opportunities as well as challenges to small as well as large businesses. It is very important for businesses to adopt and adapt to the new digital economy. For example, if consumers during weekend or holidays tend to disengage themselves from shopping then the retailers should not send email messages during those periods. Similarly, the effects of scheduling mechanism for email messages may vary according to business types and business needs. Thus, digital advertising strategies are not only about adoption but also about adaptation to make contents relevant to the consumers in this ever changing digital marketing environment.
Integrated Approach to Digital Advertising Strategy: Firms are using mix of traditional, new, and social media as a part of their integrated marketing communication strategy and consumers also consume these different media within short period of time simultaneously, a phenomenon termed as media multiplexing. Firms’ integrated marketing communication strategy along with consumers’ media multiplexing behavior makes it essential for firms to adopt a particular marketing communication tool within the framework of an integrated approach rather than making it an isolated marketing decision. Thus, integrating different communication tools in sync may reinforce media effects thereby extending customer relationship with the firm and generating sales. Research suggests that reinforcing firms’ social media advertising (such as Facebook or Twitter links), online advertising, traditional advertising (such as catalogs and weekly specials), and new advertising (such as educational and sampling classes) through email marketing have positive effects on consumer engagements and sales.