Email is the ubiquitous business application. However much we curse it and the bucketloads of spam it delivers to our desktops on a daily basis, it's almost inconceivable that any serious business organisation could contemplate operating without it. So why has email played such a relatively unsophisticated role in CRM to date?
Jupiter Research reckons that by 2008 the email marketing industry will be worth a cool $6.1 billion, up from $2.7 billion in 2005. That's a mighty leap, but one whose impact is somewhat reduced by the fact that most the email activity generated wil lbe dragged straight to trash.
"Certainly a significant portion of that $6 billion will be wasted and go straight into the garbage," argues Jason Mittelstaedt, vice president of marketing for RightNow Technologies. "The trick is not in firing out emails, but in how to ensure some engagement with the recipients. How does it fit with the wider CRM strategy. The trick with marketing is that you don't want it to look like marketing. What is CRM all about. It shouldn't be about infrastructure or about technology. It should be about putting the customer at the centre of your business.
"How does email marketing fit in? It has to fit in seamlessly. It has to come in a form that the customer wants. Who do they want to hear from? And in what format do they want to hear from you? What are you asking them to do with the email? Are they just reading it or are they expected to perform an action, like download something. Research indicates that there are some things that people are happy to receive email about. For example, transactional confirmations, when you've made a purchase or a booking or you've signed up for a membership or a service. These are things that they are interested in and which impact on them directly. What is the status of a particular account, for example. Is it running out? Does it need to be renewed?"
But the primary complaint about email marketing relates typically to the tidal wave of spam that offers everything from penis extensions through teenagers getting up to all sorts to the crop of hitherto unheard of relatives in Nigeria who have died suddenly and left you a fortune.
"People do complain about spam and they have reasons," conceded Mittelstaedt. "But not everything should be regarded as junk if you ask anyone, they usually have five or six companies that they're quite happy to receive email marketing from. It's also about ensuring that the right level and volume of mail comes through."
Mittelstaedt also insists that compahies contemplating email marketing must not approach the strategy from the point of view of looking at what they're not allowed to do with data and information. Making sure that they stay on the right sight of compliance rules and regulations is not the proper starting point for a customer focused marketing strategy.
So who gets it right? Mittelstaedt points to US footwear firm Skechers as a good example. Known for its trendy shoes and sneakers targeted at a teen to mid twenties demographic, Skechers uses RightNow Outbound permission based email solution. The company now has a permission-based database of around 800,000 consumers.
But it had been constrained by its IT people who didn't 'believe' in HTML. As a result the hip shoe company had been sending out lengthy text only emails that simply did not appeal to the graphics-hungry demographic they were meant to be addressig. There was also an issue of timing: the best time to hit the audience who buy Skechers shoes is late afternoon, early evening – after school or work when consumers are checking their emails. Instead there was a bulk mailing of the text-only emails which would arrive at 4 am and go largely unread. By changing to an HTML format and shifting to a differnet mailing time slot, the firm was able to add thousands of dollars of additional revenue to the bottom line.
Effective email marketing can also lead to additional flexibility and the ability to do powerful ad hoc campaigns. Mittelstaedt points to the example of Paddy Power, the UK's fastest growing bookmaker which has been using RightNow Marketing since 2004 to create time sensistive email campaigns within an hour of a sporting or other betting event. A foul tackle in a rugby match, for example, was followed up the chance to bet on whether the person responsible would play in the next match. The ability to place a bet on that subject was promoted by email marketing while the memory was still fresh in the minds of fans.
"It's examples like that which illustrate what you can really do with email marketing," concludes Mittelstaedt. There's no need to dine out on spam if only more companies thought more creatively about how to integrate email within their wider marketing and CRM policies.