How Does Email Work As A Performance-Based Advertising Channel?

Email marketing has always focused on performance. Early on, marketers began tracking and improving performance in terms of opens, clicks, and -- ultimately -- ROI.

In many ways, standalone email advertising remained a different story. Still, this medium has great potential to fit in with the performance-based media buys many agencies and brands prefer.

Standalone Email Advertising Historically
Traditionally, standalone email advertising meant buying or renting a list. There’s a big difference between these two practices. Briefly, it’s this:

  • Buying: The actual list changes hands.
  • Renting: List owner sends email on behalf of advertisers, exactly like other media buys where publishers serve ads for advertisers.

Most email marketers will say buying (or selling) an email list is a bad idea, and I would definitely agree.

Renting lists, on the other hand, is a practice many online publishers use to monetize their audience. The ads they send can be called sponsored newsletters, email blasts, email advertising, etc., but they work on the principle that the list owner or their agent sends an email consisting solely of an ad for a single brand (preferably with a header that makes it clear who is sending the email).

Typically, these types of ads are sold on a CPM basis. At the end of the campaign, the list owner sends a click and open report. Some publishers offer these “email blasts” as a value-add for advertising in a print publication. They may or may not offer the ability to target on certain demographic information, but often the “blast” goes out to the entire email list with no segmentation.

Email advertising should be so much more than that.

What Email Advertising Can Be
Email ad servers now make it possible for media buyers to buy standalone email advertising on a performance basis, the same way they buy display and search.

Performance-based email buys offer:

  1. Price Clarity – Marketers set their bid based on the action they want to drive (clicks, conversions, etc) and set a budget per campaign or day. They know exactly what they’re buying and the maximum amount they’ll spend.
  2. Granularity – Most online ad serving that allows marketers to target specific individuals relies on cookies. An email address is a unique identifier. So without relying on cookies, marketers can target based on demographic or behavioral data. Because email is highly personal (brand emails sit alongside messages from friends and family), this granularity is critical for tightly targeting messages and adapting contentto individual subscribers.
  3. Insight – Using a third-party ad server means both sides receive clear, accurate information about emails served, opened, clicked, etc. Because the buy is based on performance, it’s easy to compare to other channels and decide where to allocate dollars.


How to Make it Work for Your Brand
To drive long-term results for your brand, make sure that any list owner or ad server you work with incorporates three critical elements into its structure:

1.     Subscriber Respect –Standalone email advertising campaigns should only be sent to subscribers who have given the list owner permission to send third-party offers. Emails should always be sent with an unsubscribe link that’s easy to find.

2.     Relevance –Email advertising must be relevant to the recipient or it won’t be welcome. Subscribers become unsubscribers in a heartbeat (or worse, will report your email as spam). Make sure you can carefully target sends to recipients most likely to be interested.

3.     Continual optimization – Don’t send to all qualified targets at once. Sending in smaller waves lets you use data gathered to continually optimize target and creative. As an added bonus, this enables a regular flow of new leads rather than a one-shot drop.


Have you tried working standalone email advertising into your media plan? Share what you’ve learned in the comments below.

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2 comments about "How Does Email Work As A Performance-Based Advertising Channel?".
  1. Patrick Rogge from Wingman Advertising , July 26, 2012 at 4:53 p.m.
    Who offers/performance based email lists?
  2. Lynn Dalsing from ividence , July 26, 2012 at 5:49 p.m.
    Hi Patrick, thanks for your comment. Eric is out of the office currently, so I wanted to jump in. This is a bit tricky because how companies price and sell email advertising inventory differs, just as it does for display. As to how it works for ividence, we provide a platform that drives performance based on behavioral targeting -- all standalone email ads. Feel free to reach out if you have other questions. You can contact me at ldalsing@ividence.com