The Growing Effectiveness of Email Marketing and Consumers Attitudes towards Email Marketing - Literature review Example

The growing effectiveness of email Marketing & Consumers attitudes towards email marketing Table of Contents Table of Contents 2 Literature Review 3 Introduction 3 Context and definitions 4 Conceptual Framework 5 Empirical Studies 7 Summary and Gap in Literature 9 Reference List 11 Literature Review Introduction Information technology has initiated towards its widespread development in the early 1990s when the growth intensified at an exponential rate and the world started to get connected via the internet. The aspect of internet and its relationship with the advertiser can encompass a whole host of issues and this paper is directed towards development of a specific and connected issues. The internet is a channel of communication wherein the attitudes of the creators of advertisements that need to be circulated and marketed via the internet is quite different from the attitudes of the recipients of such advertisements. Prior to 2005, the number of individuals who had a global email account was limited to 683 million people and this number swooped up to 1.2 billion in 2005 (Jamalzadeh, Behravan and Masoudi, 2012). Such huge rise and promising future of internet and email use provided the marketers with a tremendous market for targeting their products. Hence, e-mail advertising emerged to be one of the most influential forms of internet marketing. Advertising through the use of internet and via the email is one of the most cost effective measures of marketing that possibly any other media. Advertising using the internet is believed to have one of the highest response rates which was believed to be significant and also had the potential to have a huge propensity for expansion and reach. The statistics of 2013 revealed that a vast majority of email traffic comes from business based emails where over a 100 billion emails are exchanged on a daily basis (Radicati, 2013). Since email remains to dominant the communication space, business emails are expected to rise to about 132 billion email exchanges per day till the year 2017 (Radicati, 2013). On the flip side, it is expected that email traffic of consumers is expected to fall in the coming times. This is majorly because consumers are now shifting from traditional emails to social networking sites and instant messaging services for making their purchase decisions. The rise in number of email accounts cannot be a true representation of the rise in consumer traffic over emails because the trend is gradually changing. Statistical surveys estimate that the present email exchange is about 182 billion emails per day of which 82 billion accounts for consumer emails (Radicati, 2013). This number is expected to go down by 4% over the next 3 years (Radicati, 2013). This shall be replaced by the rise in social network usage for advertisements and also the use of instant messaging services. The chapter looks into the key definitions in the content of email advertising and marketing and builds a conceptual framework that shall form the base of this research. The conceptual framework looks into different parameters that could possibly define the effectiveness and reflect upon the attitudes of consumers when they receive such marketing communications through email messages. The measurements help towards building a model that shall help in ascertaining consumer attitudes and behavioural patterns. The empirical studies explore previous studies that have been conducted within the research topic and the results obtained by such scholarly researches. In summary, the chapter looks into the gap in literature which that paper seeks to address. Context and definitions Attitude of consumers towards an advertisement can be defined as the predisposition of the consumer to respond in a positive of a destructive manner towards a specific advertising stimulus when exposed to such an advertisement. In normal terms, an email is a tool that is designed for the purpose of knowledge sharing but this tool can have a good or a bad impact over the information presented at different points in time. Charging a specific price for the receipt of such information remains to be discretion of the sender of the email while the recipient is the 0one who decides whether or not to pay such a price for receipt of information. Evaluation of such a social contract differs on grounds of difference in the trade-offs as perceived by the consumer and the decisions that are to be made between competing and conflicting interests. The negative externalities in association with the advertisements come up with volumes, frequencies, irrelevant solicitations of email messages, intrusion into personal privacy and lack of control. This paper shall try to make an evaluation into the behaviours of users through the use of positive influential tools like information and entertainment offered by the email communications (Freeman, 2011). The study considers advertisements as a combination of media as well as a promotional message over the internet. Hence the focus of the study is the interactivity of consumers with the mechanisation and the content of the messages. Studies directed towards advertisements often do not make a differentiation between the objectives of the advertisement. This makes it difficult for research to compare and interpret studies (Luo and Donthu, 2001). Advertisements can be considered as directional or meant for the purpose of brand building. While brand building advertisements often try to sell products, directional advertisements are aimed at helping the potential consumers in located information of their interests. Conceptual Framework The study makes an outline of three basic factors that influence and also predicts the attitude of consumers towards the e-mail marketing communication channel where corporations use the direct mail channel for commercial purposes. These are perceived intrusiveness of advertising, Perception of loss of control representing psychological reaction and the third measuring the degree of irritation that is caused by techniques of marketing communications which is direct mailing in this case (Morimoto and Chang, 2006). Perceived intrusiveness of the advertisement is the construct that makes use of influence of advertisements over consumer attitudes. Studies that have been conducted in the past have stated that intrusiveness measure comprises of interference into ones privacy (Teeter and Loving, 2001), media context and task performance or the cognitive process that goes through (Li, Edwards, and Lee 2002). Hence the perceived intrusiveness as measured through an advertisement can be explained to be the degree by which an unwanted marketing communication tries to interfere with the cognitive processes and tasks of individuals and the interference of the media content which might include matters of offence to the reader or the recipient of the emails. On the privacy front, the intrusion into a customer’s privacy through the email marketing communication channel, refers to invasion into the solitude of the being. These also include intervention into the private affairs of the individual (Teeter and Loving 2001). As per Sturges (2002) definition, privacy is the space around a person that that requires to be left alone. Such explanations provide with legal aspects of definitions to privacy yet they are applicable to email advertisement s because they intrude upon the personal space of the individual which includes the mailbox of the personal computer of the individual and the concerned hard drives. It also takes up the time that is devoted towards answering calls from telemarketers or responding in some form to the emails received. Under psychological reactions, unwanted direct marketing of messages for commercial purposes creates the enhancement of a sense of loss of control among the minds of the consumer. This is because the perception is that such emails create a loss of both time and space along with the actual ability of the consumer to enjoy real media content, the purpose of which gets defeated through these email advertisements. The theory postulates that when the individuals get exposed to restrictions or pressures upon themselves which they necessarily want to put away, they tend to react negatively towards such loss of freedom and threat to loss of control by acting in a way that is not the indented purpose of the media content within the advertisements. The perception of loss of control can hence be defined as the degree to which the consumer might feel the loss of personal control over conducting their personal tasks when exposed to such email advertisements (Sheehan and Hoy, 2000). The third factor which is the irritation caused by such direct marketing channel is defined as the impatient, negative and displeasing feeling as experienced by the individual in reaction to the different forms of advertisement stimuli. Different formats of email marketing which include overly dramatized content, contrived content or contrived content and have been executed in queer manners or are presented with high frequency are to be perceived as intrusion into the privacy of the consumer and also a major cause of irritation to them because they deprive the consumer from their sense of freedom and control for pursuing the tasks that they intend to do at that moment (Li, Edwards, and Lee 2002). The characteristics of the advertisements often criticised for causing irritation through wrong targeting of the audience. Misplacing the advertisements and manipulating messages. These also include excessive messages and forcible exposures at different times (Li, Edwards, and Lee, 2002). As the customers of email marketing have started using numerous devices to access their emails, the information access and communication has started impacting increased aspects of their everyday lives. For this, email marketers have been working towards the developments of abilities that shall allow for higher access to relevant information and more timely and optimised messages that are based on whatever these marketers know about their customers. The growth of email marketing is seeing a shift towards better content that provides the client with some interesting reading material. This is supported by use of multiple channels which ensure that email are sent to customers to allow them to make more informed choices and also inspire their loyalty towards the brand. In this context, the content of information also sometimes has an effect on the informative aspect which directs the interest of the consumer towards the positive trend. The aspect of providing informative content of the advertisements has become one of the more critical factors which are now acting towards the development of positive attitudes and also soliciting positive implications through direct email advertising media. Here, the quality of information that is posted on the email or even the direct links that are guiding to company websites through such email messages are of critical importance while measuring the influence of email advertising on consumer mindset and thereby soliciting desired reactions. The information that gets delivered via e-mails also has to encompass qualitative features which include accuracy, usefulness and timeliness to the consumer. Additionally, the user shall also be allowed to have quick access to all the information he might be seeking and those that might hold high relevance to the user. There can be a high possibility that the information sought by the user can get automatically delivered to him. At any point, the content of the email needs to be designed to be in line with the interest of the consumers. They shall be interested in getting messages which shall be relevant for their purpose. Hence, information can be considered to hold immense importance in marketing via the email method where consumers might react positively through the advertisements that provide them with informative incentives. It is therefore not surprising enough to know that informative levels of the advertised information is strongly and critically related to the value of advertisement which is transferred through the traditional media modes. Additionally, entertainment acts as a critical factor for marketing where a concise and a funny message can drive a consumer’s attention more quickly and effectively. These advertisements add value through increasing customer loyalty through provision of prizes, rewards and games. These things keep customers hooked to emails awhile also creating a sense of happy feeling within them. Figure 1: Conceptual framework for studying consumer attitudes in email marketing Empirical Studies Existing literature in the study of advertising shows that there is a general confusion existing between the studies of constructs that assess perceptions of consumers towards advertisements over the web. Some studies refrain from drawing any distinction between the value of an advertisements and the attitude of consumers towards such advertisements (Zhang, 2000). Attitude towards the advertisement is the impact of an advertisement on the belief of the consumer towards the brand, the attitude reflected by the brand within the advertisements and the intention of purchase. Such cognitive decisions are explained through attitudes that consumers hold towards such advertisements. Such attitudes build up an effective response towards the ad and have emerged to be one of the popular measures of study within measurement of online advertising effectiveness (Rararski, 2002). The value of an advertisement is more of subjective valuations and measures the extent to which such advertisements give the consumers what they want. The difference between value and attitude is that a consumer could dislike a particular email message of advertisement but it might be perceived valuable by him or her. The reverse of this example could also hold true and this explains the difference between attitudes and value of consumers towards an advertisement. There are limited studies which have been directed towards specific attention into internet marketing and assessment of user attitudes towards commercial e-mails. Among the popular ones have been Chittenden and Rettie (2003) and Dufrene et al, (2005) which have been looking into psychological variables for estimating user attitudes in the direct mailing scenario. According to the authors mentioned above, direct mailing for commercial purposes have an effect on the attitudes of consumers towards these e-mails and these responses include the probability of noticing the offer made and the degree to which the attractiveness of this offer in increased being measured by the probability of responding. Such a research taken into account an email campaign and consequences of behaviours to such a campaign shall be assessed to measure informative levels, irritation, credibility and entertainment. According to vies presented by Baker and Lutz, (1988), the advertisements circulated might have either type of reactions as well as evaluations. This relates to the feeling of happiness and the credibility of information. The ad function presented within such emails is not directed towards creating a brand value for a particular ad or towards specific features and attributes of the brand or even towards selling specific products. The advertisements are simply there to create a favou5rable attitude of consumers towards the object of the ad and therefore leave behind a positive feeling in the minds of the consumer. In general, attitudes are a general statement that derives positive correlation with responses towards the product being sold. In addition to the informative degrees, entertainment and irritation factors identified within the above theory, the utility of internet for advertising shall also influence the consumer’s attitude towards the email advertisement. As per a recent study conducted by the Association of business Information and Media companies, it was found that email newsletters which were sent by media companies had the least bounce rates and the highest open and click through rates when compared with other variants like Lead Generation or third party emails of subscriber promotion emails (Audience Development Committee, 2012). Here, the newsletter emails had content which comprised of editorial matter and things that people could read through among other contents. Hence, email marketing gets popular only when the reading content is interesting and captures informational content. The emails therefore need to be high on content and entertainments factors in order to grab the reader’s attention and effort towards opening and clicking on those emails. Ducoff’s model (Brackett and Carr, 2001) for determination of web advertising was validated by Brackett and Carr in 2001 when they included credibility and demographics aspects to the original framework and extended their studies. They showed that credibility of the email advertisement was directly correlated with advertisement value and consumer attitudes towards advertisements. The research also made use of demographic variables which included educational attainment, ages and gender to develop an understanding into the impact of such demographic variables on the attitudes of consumers towards email advertisements. In another study conducted by Fernandez and Rosen (2000), it was observed that when the consumers where provided with information and advertisements that match with their interests they tend to provide higher rates of positive responses to such advertisements. Here, proactive responses are faster and highly effective. Summary and Gap in Literature Email marketing has been successful in creating a lot of opportunities in the business and has changed the way in which marketing was to be conducted by business houses. The use of marketing activities using email communications help companies to communicate with their consumers in a direct manner without any time barriers of location demarcations. Email advertising has been instrumental in addressing each consumer with an individualised message of advertising. An understanding of consumer’s attitudes towards email advertising helps in determining the best practices that could be adopted in order to remove the fallacies with email advertising and make them as effective as possible. This shall in turn help the marketers, advertisers and designers to focus of key areas as determined by the research to improve upon the effectiveness of the interactive media. 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