Rosalind Resnick of NetCreations stepped down as the company’s CEO at the end of 2001. Since co-founding the New York-based firm in 1995, Resnick became an outspoken advocate of double opt-in, where people would actively choose to receive e-mail marketing offers by signing up via e-mail or on a Web site and confirming their registration. Now that Resnick has retired from the Internet arena to pursue other business interests, she reflects on the state of the industry.
DIRECT: What is the future of opt-in e-mail?
RESNICK: I’ve been hearing people say opt-in is dead since we pioneered opt-in in 1996. I think the opposite is true. Opt-in has become universal. Almost every message you receive has a way to unsubscribe. I feel that opt-in is here to stay. A couple of years ago, we thought there would be legislation making opt-in mandatory, but the direct marketing industry has done a tremendous job of making opt-in the standard without legislation.
DIRECT: What are your thoughts about MAPS (the Mail Abuse Prevention System)?
RESNICK: When we were first starting PostMaster Direct [NetCreations’ database service] four or five years ago, we were targets of MAPS because we were sending out so much e-mail. I think the last I heard of MAPS was when the Exactis case was settled, when for the first time MAPS didn’t insist that a company [it went after] go to double-opt in. Then, I read that MAPS had the same Internet problems everybody else has had and laid off some people. I’m not dismissing the power that MAPS has, but I think it’s learned to work within the system.
DIRECT: What are the big privacy issues today?
RESNICK: Single opt-in vs. double opt-in was a big issue for awhile. But here we are at NetCreations offering our mailers both. I think it says that single and double opt-in are legitimate and it’s up to the mailers to do what’s best for them.
DIRECT: How will the trend of consolidation among the e-mail companies play out?
RESNICK: In 2001, you saw a lot of e-mail companies that melted down or were acquired. (Among some of the biggest, NetCreations was acquired by Italian yellow pages conglomerate SEAT Pagine Gialle; DoubleClick consumed MessageMedia and FloNetwork; and YesMail bought Netcentives.) I think 2002 is going to be the year of consolidation. By the end of the year, you’re going to see very few companies standing.
DIRECT: Who will make it?
RESNICK: The number-one thing e-mail companies need right now is cash. It will be DoubleClick and companies like NetCreations that are part of a larger network. I think a lot of companies will have to make the decision about whether to choose retention or prospecting.
DIRECT: How will traditional companies position themselves?
RESNICK: Companies in the traditional mail side, Worldata, Direct Media, Edith Roman and The Lake Group, have come on a lot stronger than we in the dot-com world ever anticipated. Two years ago I was predicting their demise. But they enjoy good relationships with major mailers, who want to do business with brokers they trust.
Today, we are going head-to-head with those who started out in the traditional mail space. They have an advantage because they can offer more bulk service solutions and postal along with e-mail. They tend to be privately owned, so they don’t have to support the infrastructure like a big public company.
DIRECT: What is your opinion of cost per acquisition vs. cost per thousand?
RESNICK: I really think that once the dust settles, CPM (cost per thousand) is going to emerge as the long-term business model just as it always has. Mailers have been able to take advantage of CPA (cost per acquisition) in the last year or so. I think CPA won temporarily for a handful of sites. But now the mailers are pulling back and saying we got leads, but they are not turning into paying customers.
When the dam broke in the summer of 2000 and vendors began to go off their rate cards and go off the CPM model, mailers took advantage of this. It will take a long time for them to recover. It’s been a disaster for the industry. I think that when the business-to-consumer (BTC) market recovers and the economy turns around, we may see lower prices for BTC lists, and I think CPM will be the industry standard going forward.
DIRECT: What is the legacy of e-mail in direct marketing?
RESNICK: E-mail has made direct marketing a better, faster and cheaper way for marketers to do business. Catalogs certainly haven’t gone away, but every catalog has a Web site. I think in terms of response rate, the jury is still out. E-mail has been a great way to get leads in the door, but less effective in getting people to make a purchase. It will be a big part of the DM landscape going forward.
DIRECT: What is your legacy?
RESNICK: There were a lot of people who contributed to the birth of e-mail marketing. I like to think of myself as an evangelist, someone who went out early on and said that e-mail marketing could be something big. I remember in 1996 having a conversation with a traditional direct marketer, and he said,
