• by Larry Dobrow , December 10, 2003

Email marketers hoping to raise their standing among customers might want to take a look at the practices of the financial services industry, new research has revealed. The study, conducted by NOP World Research on behalf of Bigfoot Interactive, found that adult credit card holders with home Internet access who receive communications from financial services companies via email are substantially more satisfied with those companies than those who don't.

Specifically, 78 percent of those who receive emailed communications said they would be likely to recommend their credit card issuer to others, as opposed to 69 percent of all credit card holders. Similarly, 39 percent said they were interested in purchasing additional products from their primary credit card company, versus 29 percent of all credit card holders. They also registered a higher level of satisfaction when asked whether their company respects their privacy (89 percent versus 81 percent) and marketing preferences (85 percent versus 77 percent).

What these numbers mean to Bigfoot Chief Executive Officer Al DiGuido - admittedly not the most disinterested party, given that his firm provides email communication and marketing automation technology - is that companies interested in encouraging dialogue with their customers need to more closely examine what email can do for them. "With email, it's possible to understand what customers need on a person-by-person basis," he explains.

"Communications from banks and credit card companies will reflect really well on those companies if they deliver the right message at the right time." DiGuido pauses for a second, then adds, "I know there's a bit of a 'duh' factor to that, but we're seeing much more refinement of messages going forward."

Clearly, online bill viewing and payment has caught on with consumers, with Jupiter Research projecting that the number of households that view and pay bills electronically is increasing at a compound annual growth rate of around 40 percent. Already, 37 percent of adult credit card holders with Web access receive at least one type of email from their primary issuer, and 25 percent receive service messaging or billing alerts.

The key to successful email communication with financial services customers - which likely holds for retail, automotive, and other categories as well - is providing what DiGuido describes as a "meaningful" experience. Crafting messages from a handful of data (where the customer signed up for a credit card, what type of purchases he or she made), then refining the messages sent to that customer as new information arrives is clearly a good thing.

Sending mortgage pitches to a customer who already has a mortgage is almost always not.

"The technology is there. You can deliver what's appropriate for each person," DiGuido says. When asked if this goal is overly ambitious considering the millions of customers serviced by financial companies, he responds, "Absolutely not. You start with simple profiles, then go from there."

The study was not without its share of surprises, the most striking of which related to email fraud and delivery. It's not surprising that 77 percent of respondents are concerned about fraud; it's very unexpected that 40 percent worry about failing to receive email from financial services companies due to filtering or blocking by ISPs. Forty-seven percent of those who receive email communications from their credit card company, in fact, said they would consider switching ISPs if these communications fail to reach them.

Clearly, this finding piqued the interest of DiGuido, who views it in the context of a larger industry-wide issue. "Everybody says the solution to the problems of false positives [when a legit email is incorrectly identified as spam] and spam will be some combination of legislation and technology, but I think there's just as likely to be a business solution," he explains. "ISPs already charge advertisers for access to their environment - banners, et cetera. So I asked a bunch of our clients whether they'd pay a small fee, a fraction of a penny, to the ISPs to ensure that their legitimate messages went through. It was unanimous that they'd pay it."

"If we're going to cut down on spam and make it so that marketers can use email more efficiently, we need to create a financial barrier," he continues. "This [scheme] would cut down on spam because spammers would have to identify themselves and they'd have to pay, neither of which they're ever going to do. That's your business solution, and it's not alien to the way ISPs work today."

The Bigfoot study on the email practices of the financial services industry is the first in a series of research conducted by the firm. The second installment is scheduled to arrive early in 2004.