No other medium is as effective as e-mail in increasing customer retention and sales, according to a report by Forrester Research Inc., Cambridge, MA.
By 2004, said the study, marketers will send more than 200 billion e-mails. And, they will outsource strategic and technical elements of their e-mail marketing initiatives, creating a $4.8 billion e-mail marketing industry.
The study also found that by 2003 the number of marketing e-mails will equal the volume of direct mail forwarded by the U.S. Postal Service, and by 2004, the average household will receive nine pieces of marketing e-mail per day, said Jim Nail, senior analyst in Media & Entertainment Research at Forrester.”
The high cost of direct mail and the broad-based nature of mass media vehicles such as TV and radio forces marketers to focus on customer acquisition. But the low cost of e-mail means that promoting lower-cost products and communicating with less frequent buyers can be profitable.
Forrester pointed out three areas that marketers must learn to handle more effectively. First, marketers must stop broadcasting to customers and instead begin a dialogue on a one-to-one basis. Second, marketers must offer value in the form of service and ease-of-use instead of simply pushing products. Third, marketers need to measure the depth and breadth of their relationships with customers by the amount of information shared, rather than the traditional measurements of timing, frequency and monetary value of purchases.
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