Three Big E-Newsletter Myths

Let’s put client e-newsletters in perspective: In an era of e-mail saturation, how cost-effective are they, and how should they fit into your overall marketing strategy?

Around the end of the last millennium, marketers were discovering what powerful marketing tools e-mail newsletters could be. The low cost of production and distribution was only one of the draws. Another advantage was e-mail’s interactive nature: recipients could respond to an offer or invitation easily and almost immediately. Still another advantage was that, using HTML-coded messages and newly developed tracking software, you could count how many recipients opened the e-mails, clicked on various links, and forwarded them to friends and colleagues.

"Forward this message to a friend" became the basis for a new, incredibly effective kind of marketing, called viral marketing.

Then came extreme personalization. Programmers figured out how to integrate e-mail (especially e-newsletter) content with mailing-list databases, in order to personalize e-mail messages according to each recipient’s needs and interests. You have a list of 5,000 subscribers? You can publish 5,000 individually customized e-newsletters in an afternoon.

It seemed like a marketer’s dream. E-mail service vendors sprouted up -- they offered bulk e-mailing, database storage, tracking and reporting, and even e-newsletter design services. Some of them sold electronic newsletter templates and licensed content via e-commerce. E-marketing consultants flourished.

Of course, it didn’t take long for everyone to realize the advantages of e-mail marketing campaigns, and soon people’s inboxes were overflowing with e-mail newsletters and e-mail advertisements, solicited and unsolicited. The latter, also known as spam, became such a bane that many people summarily deleted all incoming e-mail that at first glance seemed uninvited.

Then e-mail newsletters and e-marketing didn’t seem so magically wonderful any more. Marketers had to work harder and harder to make their e-mail messages (and subject lines) appealing, useful and meaningful enough to get people to open them, read them, respond to them, and pass them along to others.

Still, three myths about e-newsletters persist, largely due to the hype spawned by e-mail service vendors and e-marketing consultants:

Because they’re so rock-bottom cheap, e-newsletters are among the most cost-effective marketing tools ever.

Yes, e-newsletters are substantially cheaper to publish than printed newsletters. They’re not free, though, especially if you have a large subscriber database that occupies valuable electronic storage space. And delivering bulk e-mail does cost something.

More importantly, you can’t assume that any marketing strategy is cost-effective just because it’s cheap. There are two components to cost-effectiveness: cost and effectiveness. How does the effectiveness of e-newsletters compare with the effectiveness of printed newsletters as marketing tools? How does it compare with other marketing techniques and tactics? The answer depends on the nature of your product or service, and the characteristics of your audience. But e-newsletters are not always effective, relative to printed ones or to other marketing materials.

One major limitation is that certain segments of the population -- even some of the most sophisticated, influential purchasers and decision makers -- don’t get e-mail. For example, if you want to send your newsletter to corporate executives, you won’t reach many of them directly by e-mail, because many of them still don’t have their own individual e-mail address. They have secretaries who receive and screen their e-mail, print some out, and pass them along to the boss. (This condition might change as tech-savvy junior executives and managers work their way up the ranks into the executive suites and prefer to manage their own e-mail accounts.)

A brief digression: If your e-newsletter is extremely informative and useful, rather than self-serving and promotional, you might sneak it past the secretary or other gatekeeper on its way to the executive.

Anyway, your newsletter must be effective to be cost-effective. It may seem easy to produce an e-newsletter, but it’s not easy to produce an effective one. Remember that you are competing with heaps of other e-mail in general and e-newsletters in particular, so yours has to be extremely informative and useful to succeed.

If you have a website, you’re a fool if you don’t use an e-newsletter to promote your site.

If you have a company website, you obviously want people to visit your site -- not necessarily everyone in the world, but certainly your clients, prospects, referral sources, members, investors, volunteers, donors, constituents, etc. If you do a lot of business online, you probably want to be ranked high on the results pages of search engines. (The strategy for getting high search-engine rankings is called search engine optimization.) But not everyone is going to look for your particular service through a search engine. So you have to promote your website in other ways, both online and offline.

An e-newsletter is one way to promote your website. In some cases it may be the best way, but certainly not in every case. You can use an e-newsletter to introduce people to your website, or regularly alert them to new website features. The e-newsletter can contain both hypertext links and embedded links (linked images) that let readers click through to your home page or other "landing page."

Here are some other ways to promote your site:

• Attend conferences, conventions and seminars, where you meet people face-to-face and hand them your business card with your website address on it. Say, "Check out my website, you’ll find the information you need." In fact, face-to-face is often the best way to build relationships with clients, especially when quality and trust, not price, are their primary considerations.

• Put your URL (uniform resource locator, or website address) on your letterhead, e-mail signature, advertisements, and all your promotional literature.

• Give away promotional items, such as pens, cups, note pads, etc., with your URL imprinted on them.

• Participate in online discussion groups, bulletin boards and chats where your clientele "hangs out," and invite people to visit your website.

Whether an e-newsletter is the most effective way, or even one effective way, to attract website visitors depends again on your business and your market. You may want to test an e-newsletter to see how it compares with the effectiveness of those other techniques before you commit to publishing it regularly or on a large scale.

An e-newsletter is a good primary marketing tool -- a way to introduce prospects to your brand, and induce them to buy your product or service. e-Newsletters "put an end to cold-call sales," proclaims one publisher of customized B2B e-newsletters (Hank Stroll, InternetVIZ).

Primary marketing tools must get people’s attention, create a sterling first impression, differentiate your firm from your competitors, and motivate people to take action. Face-to-face marketing often works best, as I suggested above, when selling a professional service or a product whose price is not the main attraction. Broadcast advertising may work best in other cases, such as selling consumer products to a mass market. When selling a specialized or highly technical product or service -- e.g., variable annuities or computerized tablesaws -- a seminar or demonstration might be the best way to introduce yourself to prospects.

A secondary marketing tool reinforces the message and impression conveyed by the primary contact. Once you begin a relationship with a prospect, the secondary marketing tool helps to maintain communication and remind people of your special expertise.

Generally, I believe that newsletters, whether printed or electronic, should be used as secondary marketing tools. Newsletters aren’t the only secondary marketing tools, of course -- there are many others. But they are very effective at maintaining communication between you and your clientele, and reminding them of your superior expertise.

Some consumer product companies have used e-newsletters to keep in touch with their customers and huge masses of potential customers, but these newsletters must use very sophisticated strategies, such as database-driven content (see article on database-driven content) to be effective.

Are e-newsletters an effective way to actually generate a sale or a transaction of some sort? I don’t think so. If you want to sell something, sell it with a sales letter. If you want to impress people and build a relationship, send them an e-newsletter.

Over the past couple of years I’ve read books and articles that tout the selling power of e-newsletters. Again, they tend to be written by e-marketing consultants, not newsletter journalists or editors. When you actually look at what these authors call e-newsletters, they turn out to be substantially sales letters, with little informative content. One so-called e-newsletter consisted entirely of coupons. Call me a purist, but to qualify as a newsletter, I think you have to feature mostly news, analysis, or at least enlightening content. Just because you get people’s permission to send them e-mail on a regular basis doesn’t qualify your material as an e-newsletter, if your content is promotional and self-serving.

I hope this puts e-newsletters in a proper perspective. Yes, they can be very effective marketing tools in many cases. They can also be a gratifying way to maintain relationships with people on whom you depend for your success. In some cases, publishing them can be a lot of fun. Just be sure you have realistic expectations about what they can achieve in this era of e-mail saturation.

David M. Freedman is an award-winning writer, editor and publishing consultant, based in Chicago. He is the founder and director of Newsletter Strategy Session. Website: www.dmfreedman.com.