When less equals More

At some point, every marketer has asked this question: “If I send more e-mail, can I expect a greater return?” Conceptually, more e-mail means more eyeballs, more customers clicking links, more hits on your Website and, hopefully, more sales. But in the case of e-mail, more can actually be less — much less — return on your investment.

The three deadly sins of e-mail marketing vs. traditional direct marketing should give a marketer pause when contemplating how much is too much mail. These are: 1) Spam complaints, 2) Mailing bad addresses, and 3) Unsubscribes. The first two can cripple ROI statistics by causing poor deliverability; the third reduces the number of potential customers that see your offers.

As a responsible marketer, you can take steps to avoid these deadly sins. Collectively, these measures are facets of e-mail best practices and can be thought of as an approach to knowing your customers better. Here are some measures you can take to avoid the sins, and some practical tips for learning just how much e-mail is really too much.

What are the origins and implications of the deadly sins? As you continue to happily e-mail your entire opt-in file, daily, weekly or monthly, consider the following sobering findings from Jupiter Research's Consumer Insight Study 2006 and the ESPC's 2007 consumer survey:

• 56% will unsubscribe from e-mails based on non-compelling content
• 40% will unsubscribe from e-mails if they feel you are mailing them too often
• 20% will report e-mail as spam to their Internet service provider (ISP) instead of using the unsubscribe functionality you provide
• 79% will report e-mail as spam to their ISP if they don't recognize the sender

Spam complaints. Recipients often forget ever having signed up for your newsletters and promotional offers. Combine this with consumers' mistrust of the unsubscribe options and use of the report-as-spam button instead, and you can quickly see how spam complaints can add up. Unfortunately, even tiny spam complaint rates can have a deadly impact on your deliverability.

AOL's complaint threshold is 1%. This means that if you send 100,000 e-mails to AOL subscribers and as few as 1,000 click the ‘“report spam” button, AOL may block the remaining 99,000 e-mails — not to mention your future campaigns.

This can represent a substantial loss of brand visibility as well as a dire drop in sales. ISPs protect their subscriber base first and foremost; retaining good mailing habits that minimize spam complaints is a critical step in preserving a viable dialog with your — and the ISP's — mutual customers.

Bad addresses (unknown users). This silent but deadly group can cause your reputation undue harm. With over 30% of consumers changing e-mail addresses each year, bad addresses will always be an issue. But sending e-mail to new, unconfirmed addresses, continuing to mail inactive users and failing to remove bad-address bounces will all compound the problem.

Most top-tier ISPs such as AOL, Comcast, and USA.net monitor the number of bad addresses mailed by a sending IP, and use this key metric in assessing your reputation. Their theory is that responsible mailers remove unknown users from the list and avoid mailing old and uncertain lists — while spammers do not. Bad list hygiene and poor mailing practices will increase unknown user rates as well as the probability that all your e-mails will be blocked by the ISPs.

Inactive subscribers. Every list has inactives — those who do not open, click, or transact. Continually mailing this population can seriously harm your IP reputation and be the difference between a successful campaign — or a blockage or the spam folder.

This group is the most likely to represent the triple whammy of deadly sins with higher unsubscribe rates, higher bad-address rates, and higher spam complaint rates. The repercussions of mailing inactive subscribers can far exceed the incremental income they can provide.

How can I determine how much is too much? Let's take a closer look at each of the e-mail sins to determine if there are harbingers warning when the sin is truly deadly and, more important, how we can avoid them.

Trending the deadly sins and building your company's risk profile. Data is the key to e-mailing smarter, not more. E-mail marketing metrics can be overwhelming — but clear trends appear with a simple but effective method for examining important data points.

Here's one tracking method. From your last campaign, gather your unsubscribe rates, spam complaint rates (obtained via ISP feedback loops), and bad address rates (garnered from your deployment system), and break these out based the age of the customer (“age” being when you acquired or began e-mailing them).

Create a spreadsheet with the segment age going across the top. Break the age down into segments of zero to three months, four to six months, seven to nine months, 10 to 12 months, and more than 12 months.

Once you have completed the spreadsheet, graph this data as illustrated in the chart below. This will give you a visual representation of your risk profile and will clearly illustrate problem areas that require exploration and action.