Too often, marketers cling to the same campaign elements and tactics without thoroughly testing e-mail variables to determine what will drive performance higher. In fact a Jupiter Research study I recently concluded on the topic found that overall, about 60 percent of marketers don’t test. Challenged by resource constraints, most of these non-testers simply feel they don’t have the time to regularly test their campaigns.

Yet our research found the marketers who are testing on a regular basis (at least every other mailing) are almost twice as likely to have e-mail conversion rates that exceed industry averages by one to two percent, as compared with marketers who don’t test. Clearly, the effort of testing e-mail variables (e.g. subject lines, content) is offset by better results. Testing is really the only way for a marketer to determine which element drives higher results. It’s critical for optimizing e-mail campaigns. To ease into testing, let’s take a look at some of the rudimentary items to test.

Identify Marketing Goals. While this sounds very basic, I do find on occasion that e-mail becomes a primary promotional tool simply because it’s inexpensive. It is easy to get mired in the monotony of getting the e-mail out and lose sight of specific campaign or mailing goals. Before you can conduct any testing you must first know what the desired outcome is.

Identify Consistent Audience Segments. One of the first elements to test, and an early deliverable that comes out of testing, is audience segmentation. Ensure your e-mail solution can support multiple lists, and customer profiles can be easily divided into segments. Some attributes you’ll want to test related to audience segmentation include demographic data (e.g. income, age, sex); behaviour (e.g. open, click); purchase history (e.g. recency, frequency); acquisition source; attitudes and domain (e.g. AOL, Yahoo!). I’ve discussed using behaviour and attitudinal segmentation in previous columns; take a look at those for more ideas.

Experiment with Message Formats. While HTML is the preferred format for most marketers, anti-spam measures, including image and HTML blocking at many leading ISPs, underscore the importance of testing message format. Look for differences in delivery, open rate, click through rate and conversion. Testing formats on a domain level and obtaining insight into the domain level performance is critical to really understand the impact the message format has on performance.

Tinker with Content. One area likely to have the largest impact on campaign performance is testing different creative elements. Experiment with the subject line, personalized campaign elements, number of products and/or offers presented, and message tone. Research I’ve conducted has found personalization can have a dramatic impact on e-mail conversion rates. Determining if personalization is appropriate for your campaigns can only be achieved through testing.

Test Frequency. In order to determine your optimal mailing frequency or the impact of triggered lifecycle campaigns, test message frequency over time. My column on message frequency offers some ideas on alternate mailing intervals.

While testing is beneficial and all the above items are just some of the variables you can test, it’s very important to adhere to the following basic testing guidelines to measure which element is driving the results.

• Test only one variable at a time. Do this to determine which element is impacting performance test offers and subject lines, but don’t test both at the same time.
• Maintain a control group. To understand how the segments that are being tested behave over time, maintain a control group that doesn’t receive any of the testing treatments.
• Ensure tests occur on the same day. To minimize fluctuations in day-of-week response patterns, ensure all segments receive the tests on the same day of the week. That is, unless you’re testing day of week mailing patterns. If so, constrict the test to that one variable.
• Ensure tests are statically accurate. While the size of mailing test cells depends on your mailing list and testing method (A/B, Nth, etc.), it’s recommended that each test cell can return at least 100 qualified responses. Based on response rates, this may require cells that contain as many as 10,000 to 15,000 names.

Trial and error is a central part of marketing. Hopefully, these suggestions will make your trials a bit more scientific. Good luck — and let me know how it turns out.

By David Daniels

Paid inclusion (PI) has always been a hot potato. It’s not quite SEO (define) and not quite search advertising. No one wants to touch it.? For those new to search engine marketing (SEM), PI (what Yahoo, the only search property still offering it, calls the Overture Site Match Xchange, or OSMX, program) is an automated feed of Web pages directly into a search engine’s search results database. The feed ensures your submitted content is included in the engine’s index. But there’s no guarantee it will appear in a top position when someone searches for keywords present in that content. You pay only when someone clicks on your listing.

Some traditional SEO companies are uncomfortable with PI. In the last few years, the industry has largely accepted Google’s ethics as its own, and Google believes PI is unethical. SEO companies also still question why they should pay for something they’re already getting for free. Because PI purports to remove the need to address site challenges, some in SEO believe it infringes on their value proposition.? Pay-per-click (PPC) vendors don’t like PI, either. They’re uncomfortable not having control over how much traffic they drive and on which keywords. They don’t like having to justify the much higher CPCs (define) of PPC in comparison to PI.

But so many case studies of PI show phenomenal return on investment (ROI) that it must be tested for every SEM campaign before it can be discounted. PI can be substantially less expensive than PPC search advertising.? Our experience shows that PI drives stronger ROI and produces more top-10 rankings and traffic after a Web site has been optimized for natural search. Natural search optimization actually improves PI outcomes. Together, PI and SEO are a drastically underreported killer combination.

But there’s so much misinformation around PI, it’s worth explaining in more detail. Recently, we sampled two groups of clients: one that utilizes PI but doesn’t fully utilize SEO, and on that fully utilizes both PI and SEO. Consider these results:

• Well-optimized sites tend to perform better in PI than do poorly optimized sites.
• Clients utilizing PI but not fully leveraging SEO recommendations saw rankings rise 20 percent over time and traffic increase 3 percent.
• Clients utilizing PI and leveraging SEO recommendations saw a 65 percent rankings increase over time and a 235 percent traffic increase.

SEO with PI gives better results than PI alone.

Some leaders of our PI group have begun noting PI’s effect when a site has been optimized for natural search first. Here are some of their reasons for doing both:

• OSMX highly values link popularity. The popularity of a page on the Web site is “transferred” to the feed, which means a page’s popularity can help the fed item rank higher. An optimized site will have more links with shorter URLs, which can increase link popularity.
• Newly optimized sites can find PI advantageous if Yahoo’s spider has not yet found them.
• Optimized home pages can rank more and broader keywords with PI than without it.

If you currently utilize PI without performing natural SEO, look into optimizing for natural search to really pump up results. Similarly, if your PI-only campaign underperforms, address your site’s natural search challenges to improve your ROI. And if your natural SEO really hits home runs, see if pairing it with PI can be greater than the sum of the parts. Based on our experience, you’ll increase ROI significantly.

By Fredrick Marckini

You’ve been reading about it for at least 10 years. It goes by many names: customer marketing, relationship marketing, one-to-one marketing. Place the customer in the centre, and focus your marketing programs on delivering what the customer wants, when the customer wants it. It all makes sense. It’s how most of us like to be treated when we give a company our business. And when done right, it can affect loyalty and increase share of wallet.

In August, the American Marketing Association (AMA) announced that it, too, recognizes the importance of customer marketing. It updated its definition of marketing with a new emphasis on managing customer relationships. The Peppers & Rogers one-to-one e-mail newsletter didn’t miss the opportunity to congratulate AMA on joining the 21st century (my words) with the first change to its definition of marketing “in almost 20 years.”

I suspect marketing won’t change one bit as a result of AMA updating its definition. Customer marketing not gaining wide adoption is an issue of organizational structure, strategic commitment, and incentives, not a lack of definitions, awareness, or case studies demonstrating why it makes financial sense.

Four years ago, I wrote a book called “The Engaged Customer: The New Rules of Internet Direct Marketing.” It’s about how to build lasting customer relationships using personal, targeted, relevant e-mail driven by customer wants and needs. The book did well. Readers seemed to like it, yet most e-mail marketing programs still leave a lot to be desired.

How can that be? It seems so obvious and easy to do it right with e-mail compared to the “old” offline media. It’s much easier to personalize and deliver timely e-mail messages than traditional print communications. The cost of communicating offline usually dwarfs online equivalents. Yet most e-mail marketing programs still suck.

Having had a chance to work with companies large and small to develop customer-focused e-mail communications and marketing programs, I’ve developed some theories why:

Customer marketing is complicated. Customer-focused marketing programs are complex to implement. They often require technology infrastructure support. They’re complex to operate, too. Disparate parts of an organization must cooperate for a program to be successful. If customer service doesn’t know about a very personalized, relevant customer communication from marketing, the company or brand will fall flat on its face when the customer contacts customer service with a question, only to find no one ever heard about that friendly, personal e-mail she just received.

Complexity requires smart people. You need real leaders to create an effective customer marketing program. As indicated above, the complexity of such a program means it can only be implemented with strong internal stewardship and commitment. Success is predicated on good people willing to lead and to carry the torch. Don’t get me wrong; this is a good thing. Having your best people work on customer marketing and communications programs is a smart investment. My experience is that the leaders who carry the customer marketing torch are often relatively young. The problem isn’t that some of the best people in marketing tend to work on these programs, nor that they’re young. The problem is young, smart people often don’t stick around very long.

Smart, young people move on. Once a customer marketing program is up and running, those who worked on it get recognized. Recognition and success lead to promotions and career changes. The innovators and leaders who make customer marketing programs happen get promoted away from the programs they create. More often than not, that spells the program’s death.

Strategic initiatives require executive buy-in. Customer marketing programs are strategic. They require buy-in and support from the executive ranks. Without such support, they seldom happen. If they do, commonly they don’t survive very long. Many important customer-oriented programs don’t carry the one-to-one label, but instead have names like e-mail marketing, customer data analytics, or Web personalization. Too often, executives view e-mail marketing, data analysis, or Web personalization programs as tactical. In short, they don’t pay attention to them (unless their companies are accused of spamming or privacy violations).

Bit economics are abused. Direct marketing programs are measured on a program-level return-on-investment (ROI) basis. In the offline world of “atoms,” the cost of contact (the atoms, i.e., paper, printing, creative development, postage, etc.) places economic limits on what a marketer can do. In the online world of “bits,” there are fewer economic constraints on contact. Whether you’re blasting 10,000 or a million e-mail messages, the sending cost is low.

Though the opportunity and capabilities of the online medium for targeted, relevant, timely communications is tremendous, it’s much more complex than “blasting.” Blasting to a million customers or carefully segmenting and targeting 100,000 customers with personalized, timed messages may yield the same results, but the latter is more expensive. If you have a strategic, long-term, customer-asset-value view of the world, you’ll want to carefully manage customer communications to optimize long-term returns. Or, you could just blast a million…

Did I mention smart people move on? Once the people who conceived and implemented a sophisticated customer relationship program move on (get promoted or get a new job elsewhere), the new guy may not appreciate why he’s spending so much on e-mail. So he kills or guts the program, starts “blasting,” and gets reasonable results for far less money. At least, for the short term.

Building lasting customer relationships reaps enormous economic benefits. And it’s not easy. Doing it well and reaping those benefits requires a long-term strategic commitment. If you rely on young, smart, ambitious leaders in your organization to light and carry the customer marketing torch, your program will be a blip and then probably fail. Only with strong and lasting commitment from the top and a corporate-wide culture that puts the customer in the centre can the customer marketing vision begin to approach reality.

By Hans-Peter Br�ndmo