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Email marketing is the act of sending a
commercial message Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to put a product or service in the spotlight in hopes of drawing it attention from consumers. It is typically used to promote a ...
, typically to a group of people, using email. In its broadest sense, every email sent to a potential or current
customer In sales, commerce, and economics, a customer (sometimes known as a client, buyer, or purchaser) is the recipient of a good, service, product or an idea - obtained from a seller, vendor, or supplier via a financial transaction or exchange for ...
could be considered email
marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to empha ...
. It involves using email to send
advertisement Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to put a product or service in the spotlight in hopes of drawing it attention from consumers. It is typically used to promote a ...
s, request business, or solicit sales or donations. Email marketing strategies commonly seek to achieve one or more of three primary objectives, to build
loyalty Loyalty, in general use, is a devotion and faithfulness to a nation, cause, philosophy, country, group, or person. Philosophers disagree on what can be an object of loyalty, as some argue that loyalty is strictly interpersonal and only another h ...
, trust, or
brand awareness Brand awareness is the extent to which customers are able to recall or recognize a brand under different conditions. Brand awareness is one of two dimensions from brand knowledge, an associative network memory model. Brand awareness is a key consi ...
. The term usually refers to sending email messages with the purpose of enhancing a merchant's relationship with current or previous customers, encouraging customer loyalty and repeat business, acquiring new customers or convincing current customers to purchase something immediately, and sharing third-party ads.


History

Email marketing has evolved rapidly alongside the technological growth of the 21st century. Before this growth, when emails were novelties to most customers, email marketing was not as effective. In 1978, Gary Thuerk of Digital Equipment Corporation (DEC) sent out the first mass email to approximately 400 potential clients via the Advanced Research Projects Agency Network (ARPANET). He claims that this resulted in $13 million worth of sales in DEC products, and highlighted the potential of marketing through mass emails. However, as email marketing developed as an effective means of direct communication, in the 1990s, users increasingly began referring to it as "
spam Spam may refer to: * Spam (food), a canned pork meat product * Spamming, unsolicited or undesired electronic messages ** Email spam, unsolicited, undesired, or illegal email messages ** Messaging spam, spam targeting users of instant messaging ( ...
", and began blocking out content from emails with filters and blocking programs. To effectively communicate a message through email, marketers had to develop a way of pushing content through to the end user without being cut out by automatic filters and spam removing software. Historically, it has not been easy to measure the effectiveness of marketing campaigns because target markets cannot be adequately defined. Email marketing carries the benefit of allowing marketers to identify returns on investment and measure and improve efficiency. Email marketing allows marketers to see users' feedback in real-time and monitor how effective their campaign is in achieving market penetration, revealing a communication channel's scope. At the same time, however, it also means that the more personal nature of specific advertising methods, such as television advertisements, cannot be captured.


Types

Email marketing can be carried out through different types of emails:


Transactional emails

Transactional emails are usually triggered based on a customer's action with a company. To be qualified as transactional or relationship messages, these communications' primary purpose must be "to facilitate, complete, or confirm a commercial transaction that the recipient has previously agreed to enter into with the sender" along with a few other narrow definitions of transactional messaging. Triggered transactional messages include dropped basket messages, password reset emails, purchase or order confirmation emails, order status emails, reorder emails, and email receipts. The primary purpose of a transactional email is to convey information regarding the action that triggered it. But, due to their high open rates (51.3% compared to 36.6% for email newsletters), transactional emails are an opportunity to introduce or extend the email relationship with customers or subscribers; to anticipate and answer questions; or to cross-sell or up-sell products or services. Many email newsletter software vendors offer transactional email support, which gives companies the ability to include promotional messages within the body of transactional emails. There are also software vendors that offer specialized transactional email marketing services, which include providing targeted and personalized transactional email messages and running specific marketing campaigns (such as customer referral programs).


Direct emails

Direct email involves sending an email solely to communicate a promotional message (for example, a special offer or a product catalog). Companies usually collect a list of customer or prospect email addresses to send direct promotional messages to, or they rent a list of email addresses from service companies.


Comparison to traditional mail

There are both advantages and disadvantages to using email marketing in comparison to traditional
advertising mail Advertising mail, also known as direct mail (by its senders), junk mail (by its recipients), mailshot or admail (North America), letterbox drop or letterboxing (Australia) is the delivery of advertising material to recipients of postal mail. The d ...
.


Advantages

Email marketing is popular with companies for several reasons: * Email marketing is significantly cheaper and faster than traditional mail, mainly because with email, most of the cost falls on the recipient. * Businesses and organizations who send a high volume of emails can use an ESP (email service provider) to gather information about the behavior of the recipients. The insights provided by consumer response to email marketing help businesses and organizations understand and make use of
consumer behavior Consumer behavior is the study of individuals, groups, or organizations and all the activities associated with the purchase, use and disposal of goods and services. Consumer behaviour consists of how the consumer's emotions, attitudes, and ...
. * Almost half of American Internet users check or send email on a typical day, with emails delivered between 1 am and 5 am local time outperforming those sent at other times in open and click rates.


Disadvantages

* As of mid-2016 email deliverability is still an issue for legitimate marketers. According to the report, legitimate email servers averaged a delivery rate of 73% in the U.S.; six percent were filtered as spam, and 22% were missing. This lags behind other countries: Australia delivers at 90%, Canada at 89%, Britain at 88%, France at 84%, Germany at 80% and Brazil at 79%. * Companies considering the use of an email 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), the European Privacy and Electronic Communications Regulations 2003, or their Internet service provider's
acceptable use policy An acceptable use policy (AUP), acceptable usage policy or fair use policy is a set of rules applied by the owner, creator or administrator of a computer network website, or service. That restricts the ways in which the network, website or system ...
.


Opt-in email advertising

Opt-in email advertising, or
permission marketing Permission marketing is a type of advertising in which the people who are supposed to see the ads can choose whether or not to get them. This marketing type is becoming quite popular in digital marketing these days. Seth Godin first introduced th ...
, is advertising via email whereby the recipient of the advertisement has consented to receive it.Fairhead, N. (2003) "All hail the brave new world of permission marketing via email" (''Media'' 16, August 2003) 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. 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 using autoresponders—known as drip marketing. They can also segment their promotions to specific market segments.


Legal requirements


Australia

The Australian Spam Act 2003 is enforced by the
Australian Communications and Media Authority The Australian Communications and Media Authority (ACMA) is an Australian government statutory authority within the Communications portfolio. ACMA was formed on 1 July 2005 with the merger of the Australian Broadcasting Authority and the Aust ...
, widely known as "ACMA". The act defines the term ''unsolicited electronic messages'', states how unsubscribe functions must work for commercial messages, and gives other key information. Fines range with three fines of AU$110,000 being issued to Virgin Blue Airlines (2011), Tiger Airways Holdings Limited (2012) and Cellar master Wines Pty Limited (2013).


Canada

The "Canada Anti-Spam Law" (CASL) went into effect on July 1, 2014. CASL requires an explicit or implicit opt-in from users, and the maximum fines for noncompliance are
CA$ The Canadian dollar (symbol: $; code: CAD; french: dollar canadien) is the currency of Canada. It is abbreviated with the dollar sign $, there is no standard disambiguating form, but the abbreviation Can$ is often suggested by notable style g ...
1 million for individuals and $10 million for businesses.


European Union and UK

In 2002 the European Union (EU) introduced the Directive on Privacy and Electronic Communications. Article 13 of the Directive prohibits the use of personal 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; this does not apply to business email addresses. The UK gives sole traders and members of unincorporated partnerships the same protection as private individuals. 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 and applies to all organizations that send out marketing by some form of electronic communication. The GDPR in 2018 imposed ''"a number of new requirements on companies that collect, store and process personal data from EU users, which impacts email marketers"'' - in particular, users' right to access information held about them; and the right to have all such information deleted at their request.


United States

The
CAN-SPAM Act of 2003 The Controlling the Assault of Non-Solicited Pornography And Marketing (CAN-SPAM) Act of 2003 is a law passed in 2003 establishing the United States' first national standards for the sending of commercial e-mail. The law requires the Federal Trad ...
was passed by Congress as a direct response to the growing number of complaints over spam emails. Congress determined that the US government was showing an increased interest in the regulation of commercial electronic mail nationally, that those who send commercial emails should not mislead recipients over the source or content of them, and that all recipients of such emails have a right to decline them. The act authorizes a US$16,000 penalty per violation for spamming each individual recipient. However, it does not ban spam emailing outright, but imposes laws on using deceptive marketing methods through headings which are "materially false or misleading". In addition there are conditions which email marketers must meet in terms of their format, their content and labeling. As a result, many commercial email 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 email, services also 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, email service providers (ESPs) began to help customers establish and manage their own email marketing campaigns. The service providers supply email templates and general best practices, as well as methods for handling subscriptions and cancellations automatically. Some ESPs will provide insight and assistance with deliverability issues for major email providers. 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 updated with some new regulations including a no-fee provision for opting out, further definition of "sender", post office or private mail boxes count as a "valid physical postal address" and definition of "person". These new provisions went into effect on July 7, 2008.


See also

* CAUCE – Coalition Against Unsolicited Commercial Email *
Customer engagement Customer engagement is an interaction between an external consumer/customer (either B2C or B2B) and an organization (company or brand) through various online or offline channels. According to Hollebeek, Srivastava and Chen's (2019, p. 166) S-D lo ...
* Suppression list *
Email spam Email spam, also referred to as junk email, spam mail, or simply spam, is unsolicited messages sent in bulk by email (spamming). The name comes from a Monty Python sketch in which the name of the canned pork product Spam is ubiquitous, unavoida ...
- Unsolicited email marketing


References

{{Authority control Advertising by medium Email Digital marketing Market research Marketing techniques Online advertising Spamming