Ups and Downs

by Bill McCloskey, Mar 4, 2004, 12:00 AM

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This week I have another free email report for all of you. You'll have to read the article or at least scroll to the bottom to see what it is, but first:

I spoke with Michael Mayor, president and chief operating officer of Netcreations, this week to get his take on the recent events in e-mail, i.e. how his company handled the whole CAN-SPAM issue and what he sees coming down the pike. Netcreations has always positioned themselves as one of the good guys, long before Congress was doing something about the issue. No post office boxes for them: you always get a true street address in their messages. Ah, if only more e-mail companies would think long-term instead of hiding behind UPS storefronts and domain-by-proxy registrations.

Netcreations is one of the leaders in permission-based e-mail marketing so I wanted to know how the company, who has always been above board with double opt-in lists, had weathered CAN-SPAM and what challenges they see ahead.

As might be expected, the first two weeks were chaos. First, there was the process of educating the customer base on the law and how to comply with it. In order to meet that challenge, they actually developed a new software tool - a DNE (Do Not Email) manager - to facilitate compliance for their clients and affiliates: "It was a big mountain to climb, but we climbed it," said Michael. And now things have calmed down: "Everyone understands what it means to be compliant."

The next thing that happened was that unsubscribes went up, as Michael expected they would. "That is actually good news. It means that people are feeling more positive about the e-mails they receive being legitimate and so they feel better about unsubscribing. Previously we manually deleted e-mail addresses of people who had not responded in a while. This actually had the effect of cleaning up our list," he said. And, of course, it raises the response rates now that the deadwood was cleared away and the lists consisted of people who legitimately wanted to be there.

Being able to actually unsubscribe from a list had the effect of making people feel more comfortable about responding to the offers, a lesson that other e-mail list owners, and the advertisers that use them, need to understand.

As far as the future is concerned, according to Michael: "2003 was the year of spam politics. 2004 will be the year of spam technology. Yahoo! and others are building solutions. Everyone is looking at the right variables." However, he doesn't feel that certain technological solutions such as an E-mail Postage plan, put forth by Bill Gates a few weeks ago, is well thought out at this stage.

As far as what is hot right now, NetCreations works in strict verticals which run at different times hot or cold. Hot right now? "IT is coming back and market research is also coming on strong, " he says.

Data from the Insider: So this got me thinking. I decided to run a report from CETS, our e-mail intelligence system, to see if I could notice any trends over the past two months.

Although I had to compensate for the short month in February, it was clear that the volume of email campaigns had increased 13% in February over January.

Specific Market Sectors that showed gains in February, up from the month before included:
Automotive: Manufacturers up a whopping 127% in February
Beverages up 81%
Cosmetics/Toiletries up 70%
Coupons and Promotions up 22%
Dietary Supplement up 116%
E-Commerce: Books, Music, and Movies up 129%
Educational: Study Aids and Educational Products up 127%
Finance: Debt Elimination up 64%
Foods: Confectionery up 75% - (think Valentine's Day)
Household Products/Supplies up 68%
Nutritional Supplements: Cholesterol up 80%
Nutritional Supplements: Male Enhancement up 144%
Pharmaceuticals: E-Commerce up 124%

On the downside we have:
Business Services down 36%
Electronics down 57%
Finance: Credit Reports down 41%
Finance Loans: Auto down 58%
Foods: Frozen down 56%
Home Furnishings/Textiles down 38%
Insurance: Health down 33%
and Telecommunications down 26%

Other categories remained pretty much even or there wasn't enough data to draw any real conclusions.

As far as Michael's observation that IT and market research are taking off, we see the same trend: IT emails up 18% over January and market research up 19%.

And here is the free report offer: If you would like a copy of the full report showing the increase and decrease in email volume for all market sectors we track, please email me at bill@emerging.com. Ask for the E-mail Market Sector Trend Report.

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