Personalized Email - More Expensive, More Effective

Everyone is familiar with personalized direct mail, the letter and other components making constant reference to the recipient's name. Now email can be personalized as well.

Email from Dynamics Direct/Los Angeles integrates all the rich media elements with personalization, producing an email product that doesn't just include moving pictures and sound, but the recipient's name in voice and text.

"The primary evolution of email is the improvement in delivery," says Russ Gillam, president and CEO of Dynamics Direct. "With dynamic personalization, you're able to deliver it to the individual based on the database information. You integrate the database elements into the streaming audio and visual file."

Dynamics Direct samples show the recipient's name printed at the top of the email in a salutation. The name is also included in the audio text that is part of the email.

But the personalization goes beyond the recipient's name. "You can tailor offers based on their individual preferences," Gillam notes. "Through data mining and warehousing, you establish the tendencies of the recipient. You can do it across all types of email but we've mastered it with rich media." An email sent by a travel advertiser, for instance, might show recipients their destination of choice, based on past travel habits.

As much as 50 percent of an email can be personalized, Gillam says, but no more because then it would be a completely different ad.

Gillam says personalized email is considerably more expensive than traditional html email, so only the biggest advertisers tend to use it. Clients include AT&T, Sprint, Charles Schwab, eTrade and Earthlink. Advertisers pay a $15,000 fee to set up the email, which also pays for the first 400,000 emails sent. There is a CPM charge of 1/2 cent to four cents based on volume for additional emails.

Clients deliver up to five million emails, Gillam says.

Gillam says personalized email performed well in tests against text and html email. He also says it performed well against direct mail.

Ben Isaacson, executive director of the Association for Interactive Media, part of the Direct Marketing Association, admits that the personalization of email has direct mail beat in some ways. "It offers a level of personalization that's not feasible for direct mail," he says, such as personalized order confirmation letters. Personalized email used for instant customer communication goes beyond what direct mail does, he says.

He's worried that personalized email might not work for business to consumer advertising. "I don't know if it's cost effective to use personalization unless it's a high dollar sell," he says. But Gillam says it is being used by b to c advertisers and the cost is no deterrent. "For the big boys, the cost isn't more than html, you're able to amortize the cost of the content across 1.5 million or more names."

Gillam says business suffered in the immediate aftermath of the terrorist attacks. "Any contracts pending were put on hold," he says. He also notes, "People weren't opening email for a couple of weeks as regularly as we anticipate and response rates were down. But it was a short window of decline, a two to three week phenomenon before click-throughs were back to normal."

It remains to be seen whether they will stay normal in light of the most recent developments.

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