Email Communications

The advent of email has changed the equation. Email communications work well. Their costs are much lower than for direct mail, but so are the response rates.

Email customer communications have become more and more acceptable. American Airlines sends weekly notifications of low-cost fares. Amazon sends emails promoting new books. Lands’ End promotes new clothing. The economics are powerful.

Direct mail is expensive. If it costs you $30.50 to get a response, as shown in Table 6-1, you had better have something profitable to sell to the responders. On the other hand, with emails, the response rates are much lower, but the costs are dramatically lower.

Table 6-1: Cost per Response: Email vs. Direct Mail

	Direct mail	Email
Sent	400,000	400,000
Cost each	$0.61	$0.04
Promotion cost	$244,000	$16,000
Response rate	2.00%	1.00%
Responses	8,000	4,000
Cost per response	$30.50	$4.00

Because email is so inexpensive, it can be abused. The cost of direct mail, on the other hand, is high, and that is good because the expense weeds out frivolous mailers. You know that the junk mail you receive must be profitable, or the company would not be sending it. Even if you are not interested in what is being offered, there must be thousands of other recipients who are interested. The cost of direct mail makes it imperative that marketers design something that will be appealing to at least 2 percent of those to whom it is addressed. On the other hand, since email is so inexpensive, thousands of marketers who could not afford direct mail are cluttering the Internet with billions of unsolicited commercial communications. This poses a difficulty for legitimate marketers. Their message gets lost in the clutter of worthless marketing messages.

Direct mail has a lot of problems that are easily solved with email. It takes a long time, sometimes weeks, to know if your message is working with regular direct mail. Another difficulty with direct mail is that there is no practical method for people who do not want to receive the information to remove their names. The mailer who sent a particular piece rented the names from someone else. He probably does not have a database. Telling the mailer to remove your name is like spitting into the wind. The mailer might keep a database of removals and run it against the next list that he rents, but why should he? He will make no money by doing it, and in direct marketing, profits are everything. People don’t do things that are unprofitable. You can contact the Direct Marketing Association and get your name entered on its do not mail list, but many mailers do not use this list.

A good emailer, on the other hand, makes it very easy for people to remove their names from the list. Most of the good ones have “one-click” removal. If you click one spot at the bottom of the email, your name is automatically removed from the list. Anyone who does this, however, finds it an endless job. Despite constant grooming, my email is clogged each day with at least 20 emails that I have to delete before I get down to the good stuff. This takes me only a couple of minutes a day, however—certainly less time than it takes me to throw out my junk direct mail. Despite its problems, many companies are now using email very effectively to communicate with their customers and fans.