Collecting and renting data from membership sites is a strong business, despite privacy, spam and ISP filtering, says Allan Levy, CEO of SilverCarrot, New York. His six membership sites have helped him build a database of 20 million records and triple his revenue in the last year. One reason? He knows how to avoid the spam rap.
DIRECT: In this age of privacy paranoia, why would people visit a membership Web site and fill out an extensive questionnaire about themselves?
LEVY: We're giving them something of value — a recipe a day from recipeforliving.com, a chance to earn points for merchandise on milesource.com, or a prize on prizeplanet.com. We get 150 data points from some members. Filling out the survey is actually optional, but 70% fill it out.
DIRECT: Why do they trust you?
LEVY: It's a pretty extensive membership process. First, they click on a banner or e-mail, then fill out a multiple-question registration form, which asks for lifestyle, demographic and interest information. Finally, they receive an e-mail confirming their membership. (Those who reply to this are placed on a double-opt-in list; those who don't end up on a single-opt-in file.) They are consciously signing up — they don't get on the list by accident.
DIRECT: What's your opt-out rate?
LEVY: Four-tenths of 1 percent per mailing. Plus, we're very, very careful to take people off the list as soon as they opt out — in real time.
DIRECT: Why so careful?
LEVY: Because of the spam problems out there.
DIRECT: What about people who don't open your mail?
LEVY: If someone hasn't opened an e-mail for 30 days, we put them into a less-frequent mailing cycle. If they haven't opened an e-mail for 180 days after that, we pull them off the list. You really don't want to be contacting people who don't want to be contacted.
DIRECT: How much e-mail do you send out a month?
LEVY: Three hundred million messages.
DIRECT: Your e-mail must get snagged in filters quite a bit.
LEVY: We do get caught, but we work it out. Filters and the increase in spam is one reason we instituted the 180-day rule. We figured why have the ISPs pay for the bandwidth on those people when they are not responding? And we struck up a relationship with the top five ISPs in conjunction with our e-mail service provider.
DIRECT: Has your open rate declined?
LEVY: A year and a half ago, we got a 60% open rate. Now it's in the 20% range. That decline told us it's very important to have valuable content. Subject lines need to be as explicit as possible. Instead of “Special Recipe for You,” it will say “Apple Pie Recipe.” Then they have all the information they need and don't have to take the time to open the e-mail unless they want to.
