ELECTRONIC MARKETING: E-mail takes off

Many are trying e-mail promotions

The payoff may not be enormous yet – if even quantifiable – but e-mail marketing is heating up among consumer print catalogers.

A number of catalogers, including general merchant Spiegel, food marketer Omaha Steaks, multititle mailer Hanover Direct, and kids’ clothing cataloger Children’s Wear Digest, have active e-mail programs they use to promote special offers to customers.

Most catalogers with outbound e-mail marketing programs collect customers’ e-mail addresses through opt-in registration areas on their Websites. Nearly 88% of respondents to the 4th Annual Electronic Marketing survey (see this month’s i.merchant, pg. S8) say they capture e-mail addresses from visitors who register on their sites. And 59% send out e-mails to promote their sites, while more than 47% say they send e-mails to those customers with special product offers.

In addition to what’s become the typical array of special-offer e-mail promotions, $254 million food cataloger Omaha Steaks e-mails “relationship-building promotions, such as recipes,” says marketing manager Mike Robinson. “We’re also sending unique offers to opt-in customers that may not be found on our Website.” Omaha Steaks, which has had an e-mail marketing program in place since 1998, sends e-mails every other week to customers who have opted-in.

Spiegel, which launched its Website back in 1995, kicked its e-mail marketing campaign into high gear in early 1999. Since that time, it has built up an e-mail address database of 300,000, claims vice president of marketing and advertising production Christian Feuer. “Our e-mail program is strictly opt-in,” he says. Like most catalogers that e-mail customers, Spiegel’s promotional e-mails plug new or sale items, or advertise limited-time and specific holiday offers. To gauge success, $587 million Spiegel tracks the number of customers who click from the e-mail to its Website. Then it calculates how many of these recipients place orders online vs. the number of e-mails sent. “Just as we do with our print catalog,” Feuer says, “we calculate gross sales per our investment,” though he won’t elaborate on the company’s response rates.

Richmond, VA-based Children’s Wear Digest sends e-mails announcing new merchandise, special offers, or special “events” on the cataloger’s Website, says president Jim Klaus. The $35 million cataloger “tracks back to see what they’ve bought once they click on a special link on the e-mail,” he says. Children’s Wear Digest has built up an e-mail list of 5,000-7,000 customers.

The cost involved with e-mail “isn’t significant,” Klaus says. “It’s just a small set-up fee and only a few cents per e-mail.” Tracking efforts show that e-mail promotions yield a response of “less than 10%.” But he notes that “we track people who go directly to the site from the e-mail. So if you close the e-mail, then go to the site later and order, we wouldn’t know.”

Eddie Bauer, the $1.7 billion outdoor apparel division of Spiegel, sends out promotional e-mails to customers who have opted-in. As for e-mails that are designed to generate sales, senior manager of I-media marketing Claire Karnofski says the company’s response has been “a little less than 1% – right about the industry average” for e-mail response. She notes that the figure represents customers who open their e-mail, click on the hyperlink to the site, and place orders.

While the response may seem low, Karnofski notes that Eddie Bauer spent “a little less than $200,000” last year on e-mail marketing, which “is not comparable” to the higher costs of Bauer’s print catalog.

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