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Building an E-Relationship with Customers

Content provided by IBM-ForwardView eMagazine .

With e-mail now firmly embedded in the corporate and social psyche, marketing opportunities abound for SMBs eager to spread their message through cyberspace. Ensuring that the message is effective, however, requires a finely tuned strategy that hooks the reader and adheres to the law.

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Thanks to e-mail, mornings will never be the same. Before pouring the coffee or reading the newspaper, a growing number of people first reach for the mouse and click on the in-box. The average American has two or three e-mail accounts and logs in at least five times a day, according to one survey by America Online. That translates into unprecedented opportunities for SMBs to use e-mail to attract new customers and build stronger strategic relationships with existing ones.


E-mail to Enhance the Big Picture

While permission-based e-mail marketing is proving to be an effective promotion tool, it should be part of an integrated marketing plan that includes other channels and touch points, such as trade shows and direct mailings. Responsible e-mail advertising complements online and print newsletters, magazines, brochures and briefs, to help your company gain industry credibility, brand recognition and customer loyalty.

When conducted in sync with other promotional efforts, a well-crafted e-mail campaign increases your overall return on investment. For instance, you might consider offering a free downloadable white paper as an incentive to companies interested in communicating with your company. This can help increase traffic to your Web site and draw attention to other special offers.


E-mail Outperforms Snail Mail

The cost of sending an e-mail is between 3 to 10 cents, according to analysts, compared to an average of $2 for sending a piece of direct mail and $3 for making a telemarketing call. And indications are that e-mail is significantly more successful in getting the message across.

In 2005 the number of people who said they were more likely to visit a direct retailer's Web site after receiving an e-mail exceeded those who said they would visit after receiving a catalog in the mail, according to a survey by a leading research group. Other experts point to e-mail response rates averaging 15 percent, compared to 1 percent to 2 percent for direct mail.

However, poorly targeted and irrelevant business e-mails irritate customers and are likely to end up unopened in the trash can. Remember that there is also a cost involved in receiving e-mail-bandwidth, security, and so on. Not only do badly crafted campaigns waste resources and fail to generate sales, but they can compromise your company and brand reputation.


Blast Off to Higher Sales

With IT infrastructure costs on the way down, e-mail can be easily tailored, targeted and tracked for commercial purposes. By providing check boxes on your list subscriber forms that enable customers to indicate their product preferences and demographics, you can create customized mailings to target these groups. Since there is a greater likelihood of a favorable response, this can help increase your return on investment.

On the other hand, bulk e-mail marketing campaigns, called e-mail blasts, offer a fast and inexpensive means of reaching large numbers of customers to communicate important information about products or services they already own and to market new products or services. Blasts work well for generalized communications, such as monthly newsletters or annual clearance sales.


Permission to Send is a Key in the Door

Obtaining customer consent for e-mail marketing is critical to a campaign's success. Permission-based e-mails-those sent to recipients who have subscribed to a list or opted to receive e-mails-have click-through rates that are double those of commercial e-mails, according to leading studies. However, be sure that your lists are current, and if you have not been in contact with a customer for more than a year, best practices advise sending a permission letter with an option to unsubscribe. This reassures your customers that you care about their privacy and ensures the validity of your list.

Also be sure you're adhering to The CAN-SPAM Act, which established strict guidelines for sending commercial e-mail, with criminal penalties for violations. It also differentiates between spam-unsolicited commercial e-mail-and a transactional or relationship message that facilitates an agreed-upon transaction or updates a customer in an existing business relationship

For SMBs considering first steps into e-mail marketing, there are several tools and services available-from companies that provide software and services to create and manage campaigns for you, to companies that provide the resources and knowledge so you can to do it yourself. These tools and services are designed to help SMBs get results quickly and inexpensively.


Best Practices Pay Off

Adhering to best practices is essential for achieving high click-through and conversion rates-and avoiding spam campaigns that result in floods of hate mail, crashing Web sites and internal mail systems. Here are some basic tips for responsible advertising that will help you run a successful campaign and avoid making enemies: 

  • Plan and strategize well in advance. Create a production checklist and formal review and approval process to help minimize errors.

  • Always use permission-based e-mail marketing techniques. There are many ways to grow your list of permission-based e-mail recipients, including customer databases, a form on your Web site, an opt-in box on your shopping cart form, links in print ads and company e-mail signatures, mailings and call center contacts, refer-a-friend programs and pay-per-click programs.

  • Build your lists wisely. Some companies sell e-mail lists of customers who have indicated interest in your kinds of products. These lists can help you target new clients, but it is very important to be aware of the legal implications involved with using such lists, and to use a company that specializes in this type of service. Still, many experts advise against the use of purchased lists. Click-through rates tend to be very low and complaints are often high. Many people forget they had agreed to receive e-mails, or fail to check the right box. Companies run the risk of being labeled spammers and blocked by ISPs.

  • Manage lists efficiently. Send a confirmation e-mail with opt-in confirmation to verify registration, use tools that will automatically check for address errors and include an "update e-mail address" link in each e-mail.

  • Create eye-catching, easy-to-read e-mails. Your e-mail design and layout should reflect your company's brand style and presence, and the text should not be too long or wordy. The subject line and first sentence pack the most punch. A professional design and compelling content will hook the reader and motivate a response.

  • Write an effective, honest subject line. Subject line content is a key focus for ISP and recipient spam filters. The subject line should inform and intrigue but not over promise.

  • Always provide an unsubscribe link. This is not only a legal requirement but also a sound e-mail marketing practice.

  • Don't send too often. Many experts recommend not sending out generalized advertising material more than once a month, unless your customers request otherwise.

  • Log the date, time and IP location of each click through. Measuring and tracking helps you maximize your return on investment, identify trends and other selling opportunities, and develop true customer value management.


Email as a Learning Tool

At the end of the day, email is not just changing our daily routines but it's having a profound effect on the way we communicate. By using email communications as part of your marketing strategy, you also have the opportunity to learn more about your customers-whether the majority of subscribers male or female, consumers or other businesses, college-educated or part of the labor workforce. Furthermore, you gain visibility into what kinds of content customers click to-for instance product updates or new releases-so you can improve customer relationships by catering to these requirements.

Content copyrighted by IBM Corporation.

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