Email has long been a panacea for marketing. The low costs of sending marketing email messages and the improved targeting of consumers makes this form of communication far better for companies than traditional advertising.
It's good for consumers as well. Instead of the pummeling they receive when watching television and all the other intrusive marketing tactics, they experience an e-world where they have more control over what they see.
Consumers are asked their permission to accept and, if desired, to opt-out of these messages. They get email that informs them about product information and promotions, and they get these messages when and how often they want.
In fact one might argue that companies like Yesmail, Clickaction (CLAC), Digital Impact (DIGI), Flonetwork (FNWK), Exactis (XACT), and Responsys.com help companies become well mannered by using permission-based email marketing techniques. "May I please contact you", the companies now ask, "Thank you and I shall try to be so considerate of your time and needs". They hope this will deepen their relationships with consumers.
This age of gentility may be coming to an end.
New data spells trouble
A recent study by Jupiter Communications (JPTR) predicts that while the average online user now receives about 40 permission based marketing messages per year, by 2005 that number will explode to 1612 - a 40-fold increase!
Forecasting is always a tricky business, as indicated by the very different forecasts for B-to-B commerce in 2003 from IDC ($1.4 Trillion) and the Gartner Group (IT) ($3.9 Trillion). But I think a 40-fold increase, even if somewhat off the mark should strike fear in companies expecting to deepen their relationships with customers using email.
Why is this happening? It's because everyone is getting on the marketing email bandwagon.
Companies envision consumers receiving these messages over their computers and also over cell phones (the Yankee Group estimates 600 million web-enabled phones by 2003), WebTV, and appliances of all sorts.
The more companies join the bandwagon, however, the worse it gets for everyone.
Behind the numbers
Think about consumers and their interactions with dot.coms in two ways: first, how many permission-marketing relationships are they willing to establish, and second, how often do they want to hear from each company about product information, special deals, or just reminders? Two possible but extreme future scenarios can illustrate the magnitude of the problem.
At one extreme, in 2005 an average consumer will enroll in about the same number of permission programs as they do now, but receive about 40 times as many emails from each program. This is a big problem since it suggests a breakdown in the core idea of permission marketing that consumers are getting marketing email when they want and how often they want. Consumers aren't in a buying mood or need reminders that often, do they?
At the other end, assuming the average consumer receives the same number of marketing emails from each program as they do now, they will need to enroll in 40 times as many permission programs! While admittedly an extreme case, this scenario is consistent with the observation that companies are increasingly veering towards the use of permission-based email messages. Even less extreme assumptions will still result in a huge increase in consumers joining email programs.
Why would consumers enroll in so many programs?
The most likely reason is to search out the best deals. The data indeed show that now 68% of consumers want promotions and deals from companies who send them email, so these programs are already tapping into deal-oriented consumers. Unfortunately these consumers are not usually the most loyal or prone to deep relationships.
And when consumers have even more choices among many companies' products via email, deal competition will skyrocket.
Can this be stopped?
Let's be clear. Permission marketing is a good concept. However, since the cost of email is so low and the promise of more effective marketing so high, companies have all the incentives to continue their focus on email marketing.
The force that stops this bandwagon will probably be consumers. They may simply stop opting in to permission based programs. They may also become more negative about email marketing in general. Most assuredly, many will engage in the simplest behavior of all - tune out the marketing based email they receive, just like they tune out so many ads now.
As I said, forecasting is a tricky business. But often the future turns out to look a lot like the past. That means consumers facing a barrage of information and deals. This may be the legacy of email marketing.
