E-Newsletters as a Form of Direct Marketing - Term Paper Example

Running Head: E-newsletters E-newsletters of E-newsletters Introduction E-newsletters remain a form of direct marketing which uses email to send commercial or fundraising messages to a target audience. Specifically emails which are sent to enhance the relationship between a merchant and customers are known as e-newsletters. They are also used to encourage customer loyalty and repeat business. They also include attempts by business organizations to acquire new customers. Research estimates that companies in the United States spent at least four hundred million dollars on e-newsletters marketing. There are many advantages to e-newsletter marketing because it allows the distribution of information to a wide range of customers at a minimum cost. Compared with direct mail and printed newsletters, it is cheap. Further returns on investment can be tracked using proper techniques. An e-newsletter arrives in few seconds as compared with direct mail advertisements. It gives business owners the power to directly send their message to their audience. Advantages of e-newsletter Other advantages of e-newsletter are the ease with which it can be tracked using web bugs, bounce messages and click-throughs. Advertisers can send advertisements about their products and services to a huge number of subscribers on a single day. At least half of internet users check their email on a day. Finally another advantage of e-newsletters is that they are paper free which means fewer costs to the environment as opposed to direct mail advertisements. The use of direct mail means that there will be more danger to the environment. Direct mail is also more expensive and takes more time to reach its target audience (Graham 2005, 34). Disadvantages of e-newsletter Many legitimate companies use e-newsletters for communication and marketing with existing and potential clients. However many companies have sent unsolicited mail known as spam in bulk quantities to consumers. Some marketers have tried to establish themselves as legitimate businesses face a battle in which they try to distinguish themselves from spam operations which are considered illegal. The difficulty of distinguishing genuine mail from spam mail marketing provides considerable problems for legitimate businesses. As a result many pressure groups in the United States have called for labeling legitimate e-newsletter campaigns as being unsolicited commercial email. The huge volume of spam also forces some users to mistake legitimate email for spam. As a result many email services now offer spam filters which might even block legitimate email. Many genuine commercial email gets caught in these spam filters (Houck 2004, 29). The United States has passed the Controlling the Assault of Non-Solicited Pornography and Marketing Act which prosecutes unsolicited bulk email as spam. Legitimate companies engaged in e-newsletter marketing must be registered and not violate the spam laws of many countries. However a company can be blacklisted if it is found to be sending unsolicited bulk email to consumers. Sometimes e-newsletters also do not get pass the firewalls and web mail systems of many corporate organizations. Another difficulty is the displaying of creative content which might have problems with certain email reading systems. Many recipients have different preferences for email offers and content. This forces many organizations to carefully research their target audience and create smart e-newsletters (Hisey 1998, 43). Importance of e-newsletter E-newsletters have become an important marketing tool for small and large size companies. Using digital imaging and computer graphics, they can become a cheap way to advertise and launch campaigns. They are also cheap as compared with direct mail. An organization can also save on graphic design, printing and mailing costs. An e-newsletter allows companies to keep the company name in front of the customers. Further they can enhance the brand recognition of any company. Finally they are effective in building a relationship with prospective clients (McCollum 1997, 49). An effective e-newsletter contains useful information for their customers. It also involves the details of new or additional products or services which a company is offering. Research has found that seventy percent of successful e-newsletters are written in a friendly and conversational voice. It should also be professional and error free. Most successful e-newsletters use a combination of graphics and photos to show the products and applications of a company. This helps in creating a professional look for the company. However care must be taken to ensure that heavy graphics and photos do not slow download time. Research has also shown that an e-newsletter should be contained within the email rather than being a part of email attachment. Most people won’t bother to open the attachment. Inserting relevant links inside the e-newsletter helps to provide the reader with useful information. The e-newsletter should be marketed to existing, new and prospective customers. Any kind of relevant media which can help print the e-newsletter also helps as an effective marketing tool. Research conducted of successful companies using e-newsletters for marketing has found that placing a sign-up form on a web site allows new subscribers to receive news about the company’s products and services. Further incentives could be offering bonuses for sign-ups. In order for companies to gain more subscribers they could offer sign-ups using direct mail and trade shows. Electronic magazines are another great way to include links for sign-up forms. Researchers who studied several e-newsletters of various companies concluded that those companies which send their e-newsletters monthly were successful in marketing their products and services. Despite the latest innovations in Wireless Application Protocol and Web offerings, the e-newsletter remains the best medium of choice for marketing and providing information on goods. A study conducted with more than five thousand consumers found out that fifty percent of them use the internet to purchase goods. Another forty six percent use the internet for discounts or savings. At least thirty percent of those who were surveyed said that e-newsletters were the source of product information. Only twelve percent of the consumers use websites run by magazines and newspapers to search for product information. Very few of them search for product information using search engines. This study was conducted in 2006 and provides an insight into the benefits of e-newsletters as effective marketing tools. The survey conducted by Prospectiv, an e-marketing company recommends small and large size organizations to launch creative and innovative e-newsletters to enhance their marketing skills (Micossi 2006, 92). Data from the survey also appears to match research conducted from other sources which show that consumers are interested in using e-newsletters for product information. Deloitte Consulting for instance found that sixty percent of consumers use e-newsletters to read online reviews of various products. ComScore, another e-marketing company found that e-newsletters generate forty seven percent of traffic for websites. Advertising by e-newsletters was also found to increase traffic for branded sites (Noack 1997, 21). One effective strategy for web marketing is to advertise in the e-newsletters of other companies. This can help to generate brand awareness and drive traffic for their websites. Advertising in another company’s e-newsletter is effective because it exposes marketers to audiences. It also helps increase subscriptions for their own newsletter if they are collecting e-mail addresses. E-newsletters are considered to the most trustworthy of interactive advertising techniques. An estimated twenty two percent of people trust an e-newsletter as compared with online banner ads. This proves that e-newsletter advertising provides an important boost for marketing of brands and products. Researchers recommend that targeting the right audience is a key to a successful e-newsletter marketing campaign. Finding out the demographics of a company’s products is essential because they might require different newsletters. It becomes smarter to target a specific audience rather than sending e-newsletters to all kinds of people. The smarter and personalized e-newsletter usually attracts more prospective and new customers for a company’s products or services. An additional advantage is the availability of data from various sources about the demographics of a particular city or country (McCue 1999, 59). A package deal is also another way for effective e-newsletter marketing. This allows the customer to see more places for a company’s advertisement. Placing a banner in print magazine or newspaper can also help in using an e-newsletter for marketing products and services. Another important strategy is to make sure that people can see and recognize the company’s advertisements all over. Including advertisements in newsletters recurrently allows the company to be consistent. Most successful marketing companies also ensure that their e-newsletters can be viewed on mobile devices. The e-newsletter must be viewable and readable on mobile devices. Creativity is an important factor in the success of an e-newsletter. Most people don’t read the entire e-newsletter. Researchers suggest that companies should use few words and logo in the e-newsletter. Tracking the number of people who are opening and reading their e-newsletters is also a crucial element of a successful web marketing strategy. Planning for competition is also an element of a successful e-newsletter campaign. Information about competitors and their advertisement placements is important. A company must compare the potential response rates for newsletters that best match their target audience with newsletter that may not be a perfect match but have less competitive congestion. Research conducted by Nielsen Norman Group, an internet research firm found out that e-newsletter are highly effective way for marketing but due to overflow of inboxes, users are becoming more selective with their information sources. Organizations must therefore pay attention to the usability and fast access of e-newsletters (Poon 2005, 49). Successful e-newsletters Recent research of internet users has found that they use many email accounts for different purposes. Some email accounts are signed up to collect newsletters which are suspicious. Convincing the internet user about the higher priority of a company’s e-newsletter is very important. This can be achieved by using a high quality newsletter subscription interface. Email services like hotmail and yahoo are offering huge storage capabilities for users. This allows them to store more information. This increases the potential long term value of a newsletter. Another way to ensure that e-newsletter is usable is to use minimum technical terminology in the newsletter. Many users have no idea about the technical terms used in e-newsletters (Smith 1999, 161). Email newsletters have been successfully used by corporations like Hewlett Packard to promote their sales and drive consumers to the website. The company launched its e-newsletter services about five years ago and currently has one million subscribers. The company’s Hpshopping division encourages users to sign up for a newsletter on its home page. The newsletter is very well designed and gives the users the exact mirror of the website. Hpshopping has managed to invest significantly in usability testing. It has invited individuals to testing sites. It observed how people read the email newsletter. The company tried adding a search engine link to the newsletter which was not successful. Another feature which was successful was the forward-to-a-friend link. Graphics and overall layout were added to the newsletter which helped increase readability and response (Swatman 1999, 49). E-newsletters can be used to attract new clients and get existing clients to reschedule. A well written e-newsletter can educate potential clients about the benefits of a company’s services. It can help promote referrals and gift certificate sales. It can ensure in client loyalty and strengthen the professional image of a company. It is a unique marketing tool which allows a company to target an audience with relevant educational information. It saves postage costs and allows the company to track results. A study conducted by Standard and Pool, an internet research firm, conducted on financial services companies found that ninety percent of newsletter users read some part of the issue. Newsletter can help create brand awareness and increase customer’s lifetime value. E-newsletters can be emailed to potential clients and existing clients can be encouraged to share their issues with a company. Selected professionals can be targeted using an e-newsletter. They can further used at fairs and public presentations. Research has found that a successful e-newsletter should be sent using a dedicated list of email addresses. An attractive and easy e-newsletter enhances the image of a company. They can be an effective reminder tool for busy professionals. They are good economic tools for the business of any organization. A smart e-newsletter should be short and to the point. Reviewing the cost effectiveness of e-newsletter is very important for a company during its marketing campaign. One way of measuring the success of e-newsletter is to keep some basic business statistics which can help in evaluating the effectiveness of a company’s actions (Srikonda 1999, 92). E-newsletters enjoy an advantage when compared with other advertising and marketing techniques. They are a personal form of advertisement since they sit in the electronic inboxes of clients. This creates a bond between the consumer and the product. Nielson Norman Group, an internet research group predicted a few years ago that spam would defeat legitimate e-newsletters. However they have revised their forecast predicting that e-newsletters are a powerful marketing vehicle which has a good future despite adverse conditions (Plunkett 2000, 95).They argue that e-newsletters must be designed to beat spam. People using email boxes are flooded with information. The greatest benefit of an e-newsletter is that it can save the reader time by pointing out specific and useful content. It can also provide shortcuts for larger amounts of information. Delivering short and streamlined information is the key to a successful e-newsletter (Hofacker 2001, 25). Headlines and subject headers determine if an e-newsletter is going to be read by a user. E-newsletters which have words associated with spam are less successful. A good e-newsletter is designed so that readers can quickly find the information without wandering aimlessly. The company must convince the clients that the e-newsletter will be beneficial for them which mean that they will look forward to reading the e-newsletter. The key is delivering useful information to the clients. Many successful companies have used smart e-newsletters which provide accurate, precise and user friendly information for their potential clients. This has led to an increase in sales of their products and services (Symonds 1999, 19). Saving the time and money of the readers must be kept in mind while forwarding e-newsletter according to research. A reliable delivery schedule gives credibility to an organization. Dynamic e-newsletter is a remarkable and innovative marketing tool which is sent according to the interests of readers. Readers are linked to preference pages where they can select from various topics. Their choices are the driving forces of dynamic e-newsletters. These types of e-newsletters provide an intelligent way to tailor messages according to the requirements of customers. The content of dynamic e-newsletters must be original and compelling. They must be original because many readers will simply refer to the original source if a repackaged e-newsletter is being sent to them (Bayne 2000, 32). The e-newsletter remains the most popular and effective marketing tool despite challenges from direct mail newsletter. Marketing using the internet can be fast and inexpensive. Research has found that newsletters sent to clients by email result in higher reading and maximum retention rates. Smart e-newsletters which do not have content that is associated with spam are more likely to reach the inboxes of email users. Many diverse businesses like car dealerships, beauty salons, medical practices and other business sectors are using e-newsletters as a personalized way of keeping in touch with customers by letting them know about products and services. Many large organizations are also successfully using e-newsletters to promote their goods and services. Many of these companies boast hundreds of thousands of subscribers who receive their e-newsletters (Birch 2000, 25). E-newsletters are an effective way to market products and services. However it is also important to understand the recent trends of successful e-newsletters. The greatest capability of e-newsletter is that they should be as relevant as possible for each recipient. The competition is tough with large numbers of messages reaching the inboxes of subscribers. The most successful e-newsletters have personalized subject lines, articles, product reviews and follow-up emails based on user activity. Companies can personalize the content of their e-newsletters by sending them to different recipients. Successful marketers also send pre-campaign test messages to uncover any delivery problems. They can sport ISP filtering, blacklisting and firewalls. They should test their messages in different email systems like Hotmail or Yahoo. Easily read e-newsletters with blocked images can also work brilliantly for a marketing campaign. Creative use of fonts and colors while relying less on images can help prevent the firewalls from blocking emails (Sterne 2001, 19). Successful e-newsletter campaigns involve special attention during the beginning of a campaign. New subscribers must have organized programs with welcome messages and e-newsletters offering new products and discounts. The permission of websites and customer contact points is very essential for a successful e-newsletter campaign. Research has found that thirty or forty percent of a company’s email list is not active which means that consumers do not open a link inside an e-newsletter. Marketers must try different subject lines and send new formats to their clients. They must update their demographic information and uncover potential trends (Williams 1999, 95). Conclusion E-newsletters remain a form of direct marketing which uses email to send commercial or fundraising messages to a target audience. Specifically emails which are sent to enhance the relationship between a merchant and customers are known as e-newsletters. An effective e-newsletter contains useful information for their customers. It also involves the details of new or additional products or services which a company is offering. Research has found that seventy percent of successful e-newsletters are written in a friendly and conversational voice. E-newsletters are considered to the most trustworthy of interactive advertising techniques. An estimated twenty two percent of people trust an e-newsletter as compared with online banner ads. This proves that e-newsletter advertising provides an important boost for marketing of brands and products. Researchers recommend that targeting the right audience is a key to a successful e-newsletter marketing campaign. With the huge commercial potentials created by the advent of the internet, e-newsletter will remain one of the most popular methods of marketing by companies. Despite increasing challenges from competitors and the use of spam filters which block many legitimate email, e-newsletters will continue to grow and remain a successful marketing strategy for many small and large organizations. Smart e-newsletters must be personalized, contain few technical words, have creative use of fonts and colors, minimize the use of images and target a specific audience. A successful e-newsletter campaign can bring many benefits for organizations to market their products and services. Creativity is an important factor in the success of an e-newsletter. 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