Thursday, April 9, 2009

Permission-Based Email Marketing

You now have a database of names of “like-minded” individuals. They’ve given you permission to stay in touch with them, so do that via email. This would be like the program above where you send out emails at a ratio of three informational messages to one info-mational message. And you would regularly irregularly feed them into the funnel of your web site. See the last section in this chapter. Let's briefly review the three types of email marketing:

1. Direct email: Direct email involves sending a promotional message in the form of an email. It might be an announcement of a special offer, for example.

2. Retention email: Instead of promotional email designed only to encourage the recipient to take action (buy something, sign-up for something, etc.), you might send out retention emails. These usually take the form of regular emails known as newsletters. A newsletter may carry promotional messages or advertisements, but will aim at developing a long-term impact on the readers. It should provide the readers with value, which means more than just sales messages. It should contain information that informs, entertains or otherwise benefits the readers.

3. Advertising in other people's emails: Instead of producing your own newsletter, you can find newsletters published by others and pay them to put your advertisement in the emails they send their subscribers. Indeed, there are many email newsletters that are created for just this purpose - to sell advertising space to others. As people tire of getting sales messages via email, it's these quality communications that perhaps hold the most potential for the future. According to a 2001 study by New Century Communications and AdRelevance, the average costs per message were as follows:

• Permission-based direct email: $0.20

• Telemarketing: $1.00 to $3.00

• Direct mail: $0.75 to $2.00

As you can see, permission-based direct email beats all other direct-marketing vehicles hands down because there are no production, paper, or postage costs. InternetVIZ reported in 2002 that email marketing response rates outpace direct mail ten to one. DoubleClick found in its 2002 survey that more than 88% of online consumers have made a purchase as a result of receiving email that they have requested. And, according to the Association for Interactive Marketing, 64% of surveyed marketers say that revenue has increased directly from transactions resulting from email usage.

Scandinavian Airlines (SAS) wanted to fill up some available seats during off-peak days during the holidays and had a great idea. For a special low fare of $149, SAS was offering a deal: fly out of the United States on a red eye, land in Copenhagen the next morning. Shop all day and board the plan that night. You snooze on the plane and wake up refreshed. They even gave a free shower voucher to use in the airport.

So, how did they get the word out without spending a fortune, which would in essence nullify the inexpensive package? Simply put: email based marketing. Or, better yet, viral marketing. Which is exactly what happened. For instance, after a friend received the offer in the email, she ran around telling all her friends about it and forwarded that email to about sixty people! When the email based marketing piece launched to SAS's registered user database, along with a link to the online offer and ticket purchase available online, reservations started coming in 9 minutes later and the flight packages sold out less than 2 days later.

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