To some banks and credit unions, todays e-mail environment looks positively radioactive. E-mail hoaxes like phishing (where fake e-mails trick people into divulging personal information) and other scams have had a negative impact on the way consumers view their in-boxes. Hence, many companies feel that e-mail marketing is simply too radioactive to touch. In our opinion, those financial institutions are losing out, while those that treat e-mail marketing as a proactive medium are benefiting. A recent study by eMarketer tells us that consumers still look to e-mail for important information. More than 60 percent rely on e-mail to stay in touch with family and friends. Just as interesting, approximately 45 percent of consumers see e-mail as a vital part of their everyday life and prefer e-mail to phone communication. More important to financial marketers, these consumers also see e-mail as a great way for companies to stay in touch with customers. Thats a pretty clear message that your customers want to hear from you. But just like the last guest at the party, you have to know when to leave or you wont be invited back. There are four key points to remember to make your e-mail program effective (rather than radioactive):
1. Â Create the channel
The majority of financial institutions do not use e-mail as a marketing channel. This is unfortunate given the statistics above, and some of the hard facts and anecdotal evidence weve seen. Consumers dont mind receiving e-mail from their bank or credit union. In fact, many of them appreciate it. When we produce campaigns for financial clients, we see comments that you just would not expect from other types of marketing campaigns. Its not unusual for our clients to get thank you notes and specific positive comments from their e-mail campaigns. This underscores the fact that e-mail is both a personal and interactive medium. The facts show that a significant segment of consumers prefer e-mail and Internet communication. It has become their channel of choice, so why would you ignore their preferences? By creating an e-mail channel, you are acknowledging your customers and members preferences. More importantly, you are creating a valuable bond that can help you cultivate your relationship, and ultimately sell more products and services.
Although there are costs and work involved in setting up an e-mail marketing channel, there are also clear benefits. The eMarketer study also demonstrated that e-mail has the second highest return on investment (ROI) ratio when measuring revenue and cost-per-contact. Its no coincidence that the telephone, which is also a personal, interactive and immediate marketing medium, has the highest productivity. The point is that once you get started, you will find e-mail to be quite cost-effective.
2. Â Be consistent
When you create your e-mail marketing program, make sure you have a plan for what you want to say, how you want to say it and how often you want to send campaigns. There is a dual benefit to this approach. One major benefit is that you can establish what your e-mails are supposed to look and sound like. So, if a phisher or scammer tries to lure your customer or member via e-mail, their chances of success will be much slimmer. The following are some basic suggestions to guide you in your e-mail marketing campaign:
• From the beginning of your program and at every point
possible, be sure to state that no e-mails from you will ever ask
for account information or verification.
• Provide anti-phishing links and information in all e-mail (in a recent e-newsletter we did for a large credit union, the anti-phishing information link was the most popular link clicked).
• Develop one or two message templates to support your campaigns. One might be for your general newsletter, and the other could be for promotional offers and specials. Either way, they should have the same general look and feel as your Web site.
• E-mail regularlyat least four times per year and up to once a month. You can be more frequent with some programs, such as rate alerts or specially targeted groups.
• Promote your e-mail opt-in program. The more your customers and members see that you are making this available, the more subscribers (and opportunities) you will have. You wont get everyone to sign up, but your goal should be at least 25 percent of your households.
3. Â Be professional
Getting through e-mail clutter and gaining access your customers in-box is more challenging than ever. Your e-mail campaigns need to be professionally executed if you want to reap the rewards. Here are some tips to help you get through:
• Stay compliant with CAN-SPAM regulations. This means (at
a minimum) honoring all opt-out requests immediately (you have 10
days by law). Of course, it also means avoiding deceptive e-mail
subject lines and not falsifying sender information, but these
aspects of the law are aimed primarily at spammers and
• Test all formatting, links and versions of your e-newsletter on different e-mail software and services like America Online, Yahoo! and Hotmail. Each has quirks that can transform a nice-looking e-newsletter into computer gibberish.
• Provide both HTML and text versions of your e-mail. HTML is the graphic version of e-mail and some e-mail programs cant (or wont) accept them. By providing alternative text versions, you give customers the option of receiving e-mails in either format.
• Use the same computer and sender name for each campaign. That way, you can ask your recipient to white-list your incoming e-mail. Being on your customers white list enables your e-mail to get through many spam filters.
• You should also make sure your messages contain the same basic header information in each campaign. E-mail headers are to e-mail what an envelope is to postal mail. They identify the sender and let the recipient know what to expect. The sender and from name should not change from campaign to campaign. Also, consider using a consistent subject line like, E-News from MyBank.
In most cases, the best way to ensure professional e-mail campaigns is to have them done by professionals. If you dont have the in-house expertise or resources, dont hesitate to consult with a professional e-mail service provider.
4. Â Be relevant and valuable
This is the most important aspect of effective e-mail marketing. While it is tempting to blast out thousands of e-mails pushing low home equity rates and high CD returns, this is also a sure way to kill your e-mail channel. Think about if you had a neighbor or friend in the auto business who was always trying to sell you something. You would quickly tune that person out and probably go elsewhere to get what you want. You may not even invite him or her to your next party. However, if that same person chatted with you about cars in general and gave you some useful information as a friend, chances you would consider his or her advice. The same applies to the relationship you enjoy with your customer or member.
E-mail enjoys some of the lowest cost-per-contact available, so you dont always have to be selling something. Use your new channel to stay in touch, inform and educate. The selling will take care of itself because, as you cement your relationships and extend your dialogue with customers and prospects, you naturally gain more sales opportunities. Going back to item number one, the key is to create a channel of communication. Once you have it, you have a powerful tool at your disposal that allows you to reach your customers and members almost instantaneously.
Still think e-mail is radioactive? Once again, the statistics suggest a different picture. As the industry continues to clean up its act and root out (and block out) spammers, the numbers for those who are practicing permission-based marketing are showing improvement. Its time for financial marketers to embrace this channel as much as their customers have. E-mail communications are the 21st century version of going to your community banker for information. Today, the Internet has supplanted the banks lobby and teller line as the way to interact with customers. E-mail is a pro-active channel in a relationship spectrum. Dont let the challenges of the medium keep you from using it to your advantage.
Ray Parenteau is president of ClickRSVP, a Hopedale, Mass.-based provider of e-marketing services to financial institutions and lenders. He may be reached at (508) 478-0440 or e-mail[email protected]