Why Are B2B E-Mail Rates Dropping?

HARTE-HANKS, a worldwide, direct and targeted marketing company based in San Antonio, TX has some answers…

Average business-to-business e-mail response rates are steadily dropping for some obvious – and some not so obvious -- reasons, reports a new "Building High Response E-Mail" study from the market intelligence team at Harte-Hanks, Inc. (NYSE:HHS). What separates the extraordinary e-mail campaigns from the ordinary? That was the purpose of the recent Harte-Hanks research, which examined 2,626 permission-based e-mail campaigns (more than 17 million messages) to uncover the strategic and creative practices of successful e-mail marketing from 2002 to the end of 2003.

The study primarily focused on business-to-business campaigns in the tele-communications and high-tech markets that were designed by clients and executed by Harte-Hanks from January 2002 to December 2003. Based on this two-year time period, average click-through response rates, broken out by time of year and purpose of campaign, ran as high as 4.7 percent in early 2002, but only as high as 2.1 percent in late 2003 (in both cases, market research recorded the highest rate):

To determine the reasons behind the drop in response, Harte-Hanks conducted a quantitative survey of 438 business and technology managers between September 2003 and January 2004.

"Increased volume has led to increased clutter," said Randy Wussler, vice president of product development, market intelligence, Harte-Hanks. "Our survey revealed that 48 percent say they are receiving too many unsolicited e-mails at home, and 31 percent said they are receiving too many unsolicited e-mails at work."

Permission Helps Drive Acceptance by Recipients

However, there are e-mail messages that these managers do want to read:  74 percent of business and technology manager respondents have opted in to at least one e-mail list during the past 24 months. Of that figure, 14 percent have opted in to 10 or more lists, and 39 percent have opted in to between five lists and nine lists. By category, these "opt-in, permission e-mail lists" break down as follows:

"The not-so-obvious reason behind the drop in response rates is that e-mail appears to be much more a sales tool now than it was two years ago," Wussler said.  "In 2002, 53 percent of the campaigns in the study were sales oriented, but that jumped to 72 percent in 2003."

Additionally, reports of "spam" (in the eyes of the recipient) show that such e-mail received at work is prevalent, though less than that volume received at home.

Best Practices:  Relevancy, Integration Boost Response

Wussler offers two suggestions for e-mail marketers in the business-to-business sector who want to stand out in today's increasingly crowded environment:

More information on the "Building High Response E-Mail" study is available at the Harte-Hanks market intelligence Web site at: http://www.hartehanksmi.com/campaign.aspx?CID=3 [free registration required]

The Web site also contains other free reports and white papers to help technology sales and marketing executives.

E-Newsletter Readers Grow Itchy Trigger Fingers - Internet News

Readers will still read e-newsletters -- but only if they contain specific, timely information, according to a new study on how Web users read and respond to e-mail newsletters. The biggest problem facing e-newsletters, obviously, is the difficulty in delineating between e-newsletters and spam. Experts agree that e-newsletters should focus on rapidly changing information such as stock market tips or weather forecasts -- not on ‘human interest’ stories. The bottom line: "E-mail newsletters must leverage the benefits of new media – instant transmission and narrowcasting. You can have a market that's a tiny segment and be high value for that." (Corante.com 2/27/03) http://www.corante.com/internet/redir/39687.htm.

Unlike the CAN-SPAM Act, the do-not-call list appears to be working. A recent Harris poll shows that 92 percent of people who've signed up for the list say they're receiving fewer calls. 25 percent of respondents say they've received no telemarketing calls since the list went into effect last October. The FCC says that complaints have dropped as well, from 4,341 complaints in October to 1,256 complaints in January. The 10^th Circuit Court of Appeals in Denver has recently upheld the list as constitutional, dismissing claims that the list violates First Amendment rights. (Corante.com 02/19/04) http://www.corante.com/policy/redir/39936.html.

The new guidelines as published in The DMA's Guidelines for Ethical Business Practice, are as follows:

 Definition of e-mail address appending: E-mail address appending is the process of adding a consumer's e-mail address to that consumer's record. The e-mail address is obtained by matching those records from the marketer's database against a third-party database to produce a corresponding e-mail address.

 A marketer should append a consumer's e-mail address to its database only when the consumer gives a marketer permission to add his or her e-mail address to the marketer's database; or

1. There is an established business relationship with that consumer either online or offline; and
2. The data used in the append process are from sources that provided notice and choice regarding the acceptance of receiving third-party e-mail offers and where the consumer did not opt out; and
3. Reasonable efforts are taken to ensure the appending of accurate e-mail addresses to the corresponding consumer records.

 A marketer should not sell, rent, transfer or exchange an appended e-mail address of a consumer unless it first offers notice and choice to the consumer.

 All messages to an e-mail appended address should include a notice and choice to continue to communicate via e-mail.

 Marketers should have in place appropriate record keeping systems to ensure compliance with these guidelines.

Conference Clips:
Net.Marketing: Consumers Still Respond to E-Mail

No matter how much spam they receive, consumers still like e-mail. According to a preliminary study released by the Direct Marketing Association at the Net.Marketing Conference, 19% of adult Americans bought a product or service as a result of a legitimate commercial e-mail in the 12 months prior to November 2003.

These 39 million consumers made an average of 6.5 purchases over that time period. And, they spent $32.5 billion on products and services. Those surveyed spent an average of $126 on their most recent purchase.

Respondents reported an average savings rate of 20% on their most recent purchase.

Consumers are not deterred by unsolicited commercial e-mail, said the study. Of those 6.5 purchases consumers made, 4.6 occurred in response to a solicited commercial e-mail, and 1.9 purchases happened in response to unsolicited commercial e-mail.

While consumers responding to legitimate e-mail spent an average of $114 on their most recent purchase, they spent more--$155 -- in response to their unsolicited e-mail.

A study conducted in the 12 months prior to May 2003 showed that consumers' purchases totaled at least $7 billion in value. But that $7 billion quantified only respondents' most recent purchases, not their total purchases over the 12 months. Of those $1.9 billion was accounted for by purchases in response to an unsolicited e-mail.

The study sampled more than 1,000 American adults. A final study will be released in March. (direct 2/26)